Dow Average extends record high as job data, Fed boost optimism

‘Big Driver’

“The big driver clearly is Fed policy,” Barry Knapp, the New York-based head of U.S. equity strategy at Barclays Plc, said by telephone. “There’s likely to be a growth-related correction at the end of the first quarter or the beginning of the second. We don’t have to worry too much about the Fed withdrawing stimulus early. Our problem is the impact of fiscal contraction, sluggish growth and investors being overly enthusiastic about the implications of the housing market.”

Raw-material, financial and health-care companies had the largest gains among 10 groups in the S&P 500, while telephone and utility stocks fell the most. Bank of America rallied 3% to $11.90. Alcoa Inc., the largest U.S. aluminum producer, added 2.6% to $8.57.

VeriFone gained 9.1% to $21. First-quarter profit was 51 cents a share on an adjusted basis, more than the company’s Feb. 20 projection of 47 cents to 50 cents. The stock has plunged 29% this year.

Best Buy Co. increased 3.2% to $18.99. Jefferies Group Inc. raised its recommendation on the retailer to buy from hold, with analysts led by Daniel Binder saying management will cut costs and bring new processes, discipline and measurement to the business.

First Solar

First Solar Inc. helped lead gains in the S&P 500, jumping 4.8% to $26.30. The biggest maker of thin-film solar panels was raised to market perform from underperform by Raymond James.

TripAdvisor Inc. rallied 2.4% to $48.81. Deutsche Bank AG analyst Lloyd Walmsley raised his price estimate for the online travel-recommendation service to $52 a share from $50, saying he was more confident that revenue growth will accelerate this year and next after a presentation by the chief financial officer at a Deutsche Bank conference.

MGIC Investment Corp. climbed 5.2% to $5.62. The third-largest U.S. private mortgage insurer began selling 135 million common shares and $350 million in convertible senior notes due in 2020, saying it may use the funds to bolster its unprofitable unit that backs home loans.

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