S&P 500 surges on housing starts, jobless claims
NEW YORK — The Standard and Poor's 500 index climbed to another five-year high as strong reports on housing starts and unemployment claims made investors more optimistic about the economy.
The S&P 500 gained 8.31 points to close at 1,480.94, its highest level since December 2007. The Dow Jones industrial average also rose, climbing to a five-year high during the day, before falling back to finish 84.79 points higher at 13,596.02. The Nasdaq composite climbed 18.46 points to 3,136.
Builders started work on homes in December at the fastest pace since the summer of 2008, the Commerce Department said on Thursday. Homebuilder stocks rose broadly on the report.
The S&P 500's homebuilding index climbed 3.8 percent, its biggest gain in almost a month. PulteGroup led the advance with a jump of $1.03, or 5.3 percent, to $20.37.
The number of Americans seeking unemployment benefits fell to a five-year low last week, the Labor Department reported, the latest sign that the job market is healing. Weekly unemployment benefit applications fell 37,000 to 335,000, a bigger decline than economists had forecast, according to financial data provider FactSet.
The reports helped offset disappointment over the fourth-quarter earnings reports of two of the nation's biggest banks, Citigroup and Bank of America, said JJ Kinahan, chief derivatives strategist at TD Ameritrade.
“The financial stocks are having a tough time impressing the Street with anything,” Kinahan said. “The traditional banks are getting squeezed on margins, and the expectations for a lot of those companies had already been set low.”
Citigroup fell $1.24, or 2.9 percent, to $41.24 after its income fell well short of Wall Street's expectations. The bank's legal expenses rose, and it released less money from its loan-loss reserves.
Bank of America dropped 50 cents, or 4.2 percent, to $11.28 after its earnings declined. The bank is continuing to work on clearing up old problems at its mortgage unit. The bank made $367 million in the last three months of 2012 after paying preferred dividends, down sharply from $1.6 billion in the same period a year ago.
Kim Caughey Forrest, a senior analyst at Fort Pitt Capital Group, said it was too early to conclude that the housing market had turned the corner. She noted that a large “shadow inventory” of houses that still need to be foreclosed on may weigh on house prices in the coming months.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Pittsburgh region’s unemployment rate stays steady
- Dominion Resources CEO Farrell made $17.3M in 2014
- GNC will expand its testing of supplements in settlement with NY
- Farmers fund research on gluten-free wheat
- Nonprofit Concordia Lutheran Ministries adjusts to marketplace realities
- Stocks gain on encouraging signs in spending and home sales
- Dollar rally tugs stock market lower; homebuilders gain on strong new-home sales
- Consumer spending inches up in February as income soars
- Highmark delays payment to UPMC over in-network issue
- Heinz merging with Kraft in mega-deal; headquarters to stay in Pittsburgh
- One secret Facebook doesn’t want you to know