Stocks climb on forecasts from Best Buy, Qualcomm
Stocks resumed their climb Thursday after upbeat forecasts from Best Buy and Qualcomm boosted expectations for the economy.
The advance came a day after a drop in the market interrupted a string of gains. The Dow Jones industrial average has risen in 10 of the past 12 days. It rose about 110 points in afternoon trading. Broader indexes also moved higher.
Stronger earnings and a higher forecast from retailer Best Buy and a better-than-expected outlook from wireless chip maker Qualcomm raised hopes that consumer spending will increase. Higher sales of flat-panel TVs, laptop computers and smart phones are welcome signs for investors because consumer spending is the biggest driver of the economy.
The advance in stocks also came on growing hope that officials would hammer out a deal to help Greece with its debt problems at a two-day meeting of European Union leaders. Investors have been concerned for months that problems in Greece and other debt-strapped countries in Europe would spread and spoil a global economic rebound.
Burt White, chief investment officer for LPL Financial in Boston, said growing confidence in the economy is deserved but that stocks have been rising too quickly in the past two months on light trading volume. That signals that relatively few traders have been generating the gains.
“This market is easier to move because a few buyers are doing it unopposed,” White said. “This comet that’s kind of shooting higher is slowly every day beginning to kind of lose some momentum.”
In early afternoon trading, the Dow rose 109.66, or 1 percent, to 10,945.81. The Standard & Poor’s 500 index rose 12.08, or 1 percent, to 1,179.80, while the
Stocks have been climbing with little interruption since early February. The move higher has been largely due to economic reports showing slow but steady improvements in the economy.
A retreat Wednesday in stocks came after a credit rating agency lowered its rating on the debt of Portugal. That raised concerns that the country would default on its borrowings and trigger a wave of losses for investors.
Bond prices were little changed a day after a steep drop. Treasury prices tumbled Wednesday after a second straight bond auction drew weak demand. The government sold $32 billion in seven-year notes Thursday to tepid demand.
The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.89 percent from 3.86 percent late Wednesday.
The dollar fell against most other major currencies. On Wednesday, the dollar hit its highest level against the euro in 10 months.
Crude oil rose 44 cents to $81.05 per barrel in the New York Mercantile Exchange. Gold rose.
Among stocks, Best Buy rose $2.20, or 5.3 percent, to $43.38, while Qualcomm rose $2.45, or 6.1 percent, to $42.64.
Three stocks rose for every one that fell on the
The Russell 2000 index of smaller companies rose 9.28, or 1.4 percent, to 692.96.