S&P 500 Reaches New High, Led By Tech
NEW YORK (CBS/AP) -- Technology companies led the Standard & Poor's 500 index to an all-time closing high Monday.
The stock market has recovered all the ground it lost over the previous two weeks, when worries over slower economic growth, falling commodity prices and disappointing quarterly earnings battered financial markets.
The S&P 500 index rose 11.37 points to close at 1,593.61. The 0.7 percent increase nudged the index above its previous closing high of 1,593.36, reached on April 11.
"The market has had a terrific run," said Philip Orlando, chief equity strategist at Federated Investors, noting that the S&P 500 is up 12 percent since the start of 2013. "At the beginning of the year, I thought we were going to 1,660 (for the whole year). We're only about 5 percent from that."
The Dow Jones industrial average rose 106.20 points to 14,818.75, up 0.7 percent. Microsoft and IBM were among the Dow's best performers, rising more than 2 percent each.
The Nasdaq composite rose 27.76 points to 3,307.02, an increase of 0.9 percent. Apple, the biggest stock in the index, surged 3 percent, or $12.92, to $430.12.
Tech's popularity Monday was a change from earlier this month, when it lagged the rest of the market. Concerns about weak business spending and slower overseas sales have cast a shadow over big tech firms, said Marty Leclerc, the managing partner of Barrack Yard Advisors, an investment firm in Bryn Mawr, Pa.
Revenue misses from IBM and other big tech companies have highlighted the industry's vulnerability to the world economy. But Leclerc thinks tech companies with steady revenue and plenty of cash look appealing over the long term.
Information technology stocks rose the most of the 10 industry groups in the S&P 500 on Monday, up 1.6 percent. It's the only group that remains lower over the past year, down 2 percent, versus the S&P 500's gain of 14 percent.
Federated's Orlando thinks tech stocks could continue to rally as investors shift money from companies that pay big dividends and have rallied recently -- utilities, healthcare and consumer staples. "They've been buying these companies, but four months into this year they've gotten expensive," Orlando said.
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