
NEW YORK (Reuters) - Stocks rallied to fresh highs on Tuesday as
investors picked up large-cap companies' shares on the expectation that
central bank stimulus will help propel the rally further.
Gains were broad, but growth sectors outperformed their
peers with bank stocks leading the way. Bank of America (BAC.N), up 2.8
percent at $13.34, was the Dow's biggest percentage gainer, while
Citigroup Inc (C.N) rose 2.4 percent to $50.09.
Wall Street has rallied without a significant
correction since the start of the year, pushing major indexes to
all-time records and
sending the S&P 500 up almost 16 percent for
2013 so far.
The ascent has been driven in large part by the Federal
Reserve's easy monetary policy, designed to stimulate the economy,
though investors' focus has turned to when the Fed may start to rein in
its bond-purchase program.
"The developed economies of the world are all easing
aggressively, the money is looking for a home, and it's ending up in the
stock markets," said Bucky Hellwig, senior vice president at BB&T
Wealth Management in Birmingham, Alabama.
For now, investors are betting that the central bank
will be careful not to remove its support too soon in order to not
disrupt the economic recovery it is trying to foster, Hellwig said.
So far, declines in the market have been met with buying and investors are trying to gauge how long that can last.
"People are indeed trying to participate in the rally,
but at the same time, they're trying to be cautious," said Brad
McMillan, chief investment officer of Commonwealth Financial, based in
Waltham, Massachusetts.
The S&P 500 financial sector index (.SPSY) rose 1.7
percent, while the S&P transports group index (.SPLRCTRN) gained
1.4 pct.
The Dow Jones industrial average (.DJI) gained 123.57
points, or
0.82 percent, to close at a record 15,215.25. The Standard
& Poor's 500 Index (.SPX) rose 16.57 points, or 1.01 percent, to end
at a record 1,650.34. The Nasdaq Composite Index (.IXIC) climbed 23.82
points, or 0.69 percent, to 3,462.61, its highest close since November
2000.
During the session, the Dow hit an all-time intraday
high of 15,219.55, while the S&P 500 climbed to an all-time intraday
high of 1,651.10.
The Nasdaq touched a fresh 52-week high of 3,468.67.
The market had traded sideways for the past three
sessions, showing a gain of just 0.07 percent as the winding down of the
quarterly earnings season and a light economic calendar have left
investors without a strong catalyst for further gains.
The Dow's gains were limited by weakness in Intel Corp
(INTC.O), down 1 percent at $23.84, and UnitedHealth Group (UNH.N), off
1.1 percent at $61.73.
U.S.-listed shares of Sony Corp (SNE.N) jumped 9.9
percent to $20.76 after billionaire hedge fund investor Daniel Loeb
called on the company to spin off its lucrative entertainment arm.
Nokia Corp (NOK.N)
unveiled a new version of its Lumia smartphone line, but U.S.-listed
shares fell 5.2 percent to $3.64. Research company Gartner said Nokia
lost 5 percentage points of market share in the first quarter, falling
to 14.8 percent.
Solar power companies' shares fell after Trina Solar
Ltd (TSL.N) estimated lower panel shipments than a previous outlook and
said its results would be hurt by a foreign currency exchange loss. The
stock fell 8.8 percent to $5.41, while Yingli Green Energy (YGE.N) slid
6.3 percent to $2.36.
Most corporate
earnings have been better than expected this quarter. With 90 percent of
the S&P 500 companies having reported results so far, 67.2 percent
have topped earnings expectations, according to Thomson Reuters data,
which is even with the average over the past four quarters. However,
only 46.9 percent have beaten revenue expectations, below the 52 percent
average over the past four quarters.
Volume was roughly 6.2 billion shares on the New York
Stock Exchange, the Nasdaq and the NYSE MKT, just below the average
daily closing volume of about 6.4 billion this year.
Advancers outnumbered decliners on the NYSE by a ratio
of about 2 to 1, while on the Nasdaq, more than two stocks rose for
every one that fell.