Housing, job data push S&P to five-year high; Intel down late

NEW YORK Fri Jan 18, 2013 5:25am IST

1 of 4. Traders work on the floor of the New York Stock Exchange, January 16, 2013.

Credit: Reuters/Brendan McDermid

Stocks

   

NEW YORK (Reuters) - Stronger-than-expected data on housing starts and jobless claims lit a fire under stocks on Thursday, pushing the S&P 500 to a five-year high and its third day of gains.

A pair of economic reports lifted investors' sentiment. The number of Americans filing new claims for unemployment benefits fell to a five-year low last week and housing starts jumped last month to the highest since June 2008.

Strength in the housing and labor markets is key to sustained growth and higher corporate profits, helping to bring out buyers even on a day when earnings reports were mixed.

Gains were tempered by weakness in the financial sector, with Bank of America (BAC.N) down 4.2 percent to $11.28 and Citigroup (C.N) off 2.9 percent to $41.24 after their results.

In other negative earnings news, shares of chipmaker Intel (INTC.O) fell 5.2 percent to $21.49 in extended-hours trading after the company forecast quarterly revenue that fell short of analysts' expectations. Intel had ended the regular session up 2.6 percent at $22.68.

The S&P 500 ended at its highest since December 2007 and now sits just 5.6 percent from its all-time closing high of 1,565.15.

"Having consolidated really for the last two weeks, the fact that we broke out, I think that that is sucking in quite a bit of money," said James Dailey, portfolio manager of TEAM Asset Strategy Fund in Harrisburg, Pennsylvania.

The Dow Jones industrial average .DJI was up 84.79 points, or 0.63 percent, at 13,596.02. The Standard & Poor's 500 Index .SPX was up 8.31 points, or 0.56 percent, at 1,480.94. The Nasdaq Composite Index .IXIC was up 18.46 points, or 0.59 percent, at 3,136.00.

Better-than-expected earnings and revenue reported by online marketplace eBay (EBAY.O) late Wednesday helped the stock gain 2.7 percent to $54.33.

In the housing sector, PulteGroup Inc (PHM.N) shares gained 4.9 percent to $20.29 and Toll Brothers Inc (TOL.N) advanced 3.1 percent to $35.99. The PHLX housing sector index .HGX climbed 2.4 percent, reaching its highest close since August 2007.

Semiconductor shares .SOX rose 2 percent to the highest close in eight months.

Financials were the only S&P 500 sector to register a slight decline for the day.

Bank of America's fourth-quarter profit fell as it took more charges to clean up mortgage-related problems. Citigroup posted $2.32 billion of charges for layoffs and lawsuits.

Energy shares led gains on the Dow as U.S. crude oil prices jumped more than 1 percent. Shares of Exxon Mobil (XOM.N) were up 0.8 percent at $90.20 while shares of Chevron (CVX.N) were up 0.7 percent at $114.75.

S&P 500 earnings are expected to have risen 2.3 percent in the fourth quarter, Thomson Reuters data showed. Expectations for the quarter have fallen considerably since October when a 9.9 percent gain was estimated.

Volume was roughly 6.5 billion shares traded on the New York Stock Exchange, the Nasdaq and the NYSE MKT, compared with the 2012 average daily closing volume of about 6.45 billion.

Advancers outpaced decliners on the NYSE by about 22 to 7 and on the Nasdaq by about 2 to 1.

(Additional reporting by Chuck Mikolajczak; Editing by Kenneth Barry and Nick Zieminski)

Photo

After wave of QE, onus shifts to leaders to boost economy

DAVOS, Switzerland - Central banks have done their best to rescue the world economy by printing money and politicians must now act fast to enact structural reforms and pro-investment policies to boost growth, central bankers said on Saturday.

Barack Obama in India

Reuters Showcase

Coal Mining

Coal Mining

India to open coal to commercial mining firms soon, minister says  Full Article 

RBI Loan Rules

RBI Loan Rules

RBI relaxes overseas loan recast rules   Full Article 

E-commerce Firms

E-commerce Firms

Amazon, e-commerce rivals fuel commercial property boom in India  Full Article 

Growth Forecasts

Growth Forecasts

Indian economic growth forecasts pegged back, despite rate cuts: Reuters Poll.  Full Article 

Uber is Back

Uber is Back

Uber back in Delhi; govt says must await approval.  Full Article 

Markets at Record

Markets at Record

Sensex rises to record after ECB stimulus programme.  Full Article 

Pharma Sector

Pharma Sector

Ipca Labs hit by FDA ban on plant for standard violations.  Full Article | Related Story 

Forex Reserves

Forex Reserves

India FX reserves at record high as RBI fortifies defences  Full Article 

QE for Euro Zone

QE for Euro Zone

ECB launches 1 trillion euro rescue plan to revive euro economy.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage