U.S. stocks rose, following five-year highs for the benchmark indexes last week, after better-than-forecast earnings from companies including Travelers Cos. and Freeport-McMoRan Copper & Gold Inc.
The Standard & Poor’s 500 Index rose 0.4% to 1,492.38 at 4 p.m. in New York.
“This country is on the verge of an explosion of greatness,” David Tepper, the hedge-fund manager who runs the $15 billion Appaloosa Management LP, said today in an interview with Stephanie Ruhle on Bloomberg Television’s “Market Makers.” “The key is to be long equities this year.”
The S&P 500 surged to the highest level since December 2007 last week as companies including General Electric Co. and Goldman Sachs Group Inc. reported better-than-estimated earnings. Some 73% of the 74 companies in the benchmark index that have released results so far exceeded projections, according to data compiled by Bloomberg. Analysts on average forecast growth of 3.8% in fourth-quarter profit, the data show.
Johnson & Johnson and Google Inc. are among 17 companies in the S&P 500 that are reporting quarterly earnings today.
Sales of U.S. existing homes unexpectedly fell 1% to a 4.94 million annual rate last month, figures from the National Association of Realtors showed today in Washington. The median forecast of 79 economists surveyed by Bloomberg called for sales to increase to a 5.1 million rate. The reading was still the second-highest since November 2009.
In Asia, the Bank of Japan made its strongest commitment yet to end two decades of stagnation, shifting to Federal Reserve-style open-ended asset purchases. The BOJ pledged to buy about 13 trillion yen ($145 billion) in assets a month from January 2014 and doubled its inflation target without setting a deadline.
Tepper said he’s bullish on U.S. stocks as the economy is set to grow by as much as 3% this year. He said investors should own stocks because they’re historically inexpensive, U.S. companies have little debt, interest rates are low, credit is fully valued and the major risks to the global economy, such as a debt crisis in Europe, have diminished.
“Whatever happens in the near-term, there is nothing to suggest the path of least resistance is not higher over the intermediate and longer-term,” Jeffrey Saut, who helps oversee about $350 billion as chief investment strategist at Raymond James & Associates in St. Petersburg, Florida, wrote in a note to clients today. “Therefore, I would accumulate favored stocks, as well as the indices, on any ensuing pullbacks.”
International investors are the most bullish on stocks in at least 3-1/2 years, with close to two-thirds planning to raise their holdings of equities during the next six months, according to a Bloomberg survey.