U.S. stocks rose, extending the Dow Jones Industrial Average’s record high, as a private jobs report showed companies took on more workers than estimated and the Federal Reserve said the economy is growing.
Bank of America Corp. jumped 3% to pace gains among financial shares. VeriFone Systems Inc. rose 9.1% as the maker of credit-card terminals reported earnings that beat its forecasts. Sohu.com Inc., owner of China’s second-largest online video website, slid 9.7% after saying it’s not in talks to take the company private or delist its stock. Staples Inc. fell 6.7% after forecasting profit that was less than analysts estimated.
The Standard & Poor’s 500 Index increased 0.3% to 1,544.59 at 2:50 p.m. in New York. The Dow rose 63.65 points, or 0.5%, to 14,317.42. Trading in S&P 500 companies was in- line with the 30-day average at this time of day.
“The market’s responding to some degree to fundamentals,” Stephen Wood, who helps manage about $163 billion as New York- based chief market strategist for North America at Russell Investments, said by telephone. “The economy is growing, albeit at a frustrating pace,” he said. “We’re seeing housing begin to contribute rather significantly to the economy.”
The Dow advanced to a record yesterday for the first time since 2007, erasing losses from the financial crisis as the bull market enters its fifth year. The S&P 500 is about 1.5% below its record high. The benchmark index has surged 128% from a 12-year low in 2009 as companies reported better- than-estimated earnings and the Federal Reserve embarked on three rounds of bond purchases to stimulate the economy.
Companies added 198,000 workers in February, according to a private report based on payrolls. The increase in employment followed a revised 215,000 gain the prior month, figures from the ADP Research Institute showed today. The median forecast of 41 economists surveyed by Bloomberg called for an advance of 170,000.
A Labor Department report this week may show private payrolls rose by 170,000 last month, according to the Bloomberg survey median. Orders to U.S. factories fell in January, weighed down by a slump in demand for military hardware and commercial aircraft, the Commerce Department reported.
Fed Chairman Ben S. Bernanke described the job market as “generally weak” in testimony to a Senate committee on Feb. 26. The U.S. economy expanded at a modest to moderate pace across most of the country amid rising consumer demand for homes and autos, the Fed said in its Beige Book report, a summary and analysis of economic conditions in 12 U.S. districts.