NEW YORK REPORT
US stocks edged higher yesterday, led by the financial sector as economic data pointed to a sustained if slow recovery from the recession, taking the Dow and the S&P 500 to nine-month highs.
The Nasdaq achieved its highest close since early October.
US consumers spent more in June, though partly because of rising gasoline prices, and contracts to buy used houses rose more than expected. But income suffered its biggest drop in four-and-a-half years, underscoring fears over growing unemployment.
The S&P financial index rose 2.1 per cent as the housing data was a positive for the sector, while the Dow Jones Home Construction index gained 2.5 per cent.
“The one thing that’s driving this market more than anything is the fear that as an investor, you’re missing out on something big,” said Angel Mata, managing director of listed equity trading at Stifel Nicolaus Capital Markets.
The Dow Jones industrial average gained 33.63 points, or 0.36 per cent, to close at 9,320.19. The Standard & Poor’s 500 Index rose 3.02 points, or 0.30 per cent, to 1,005.65. The Nasdaq Composite Index edged up 2.70 points, or 0.13 per cent, to end at 2,011.31.
Shares of Dow component Caterpillar, a heavy equipment maker, jumped 6.1 per cent to $47.89 after the company’s CEO gave an upbeat earnings presentation and said that in future recessions, the company would be able to report annual earnings well above this year’s forecast.