By Kate Gibson, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks climbed Thursday, with the
Dow industrials bouncing back after their largest hit in four
weeks, as another report cast a positive light on the U.S. housing
market.
Stock indexes retained gains after the National Association of
Realtors reported pending sales of homes rose 0.3% in April.
Other reports Thursday had the U.S. economy growing less than
expected last quarter and jobless claims rising more than estimated
last week.
"The housing market continues to look good, and GDP growth is
slow and steady, which is actually a good environment for stocks,"
said Randy Frederick, managing director of active trading and
derivatives at the Schwab Center for Financial Research.
Since start of the bull market, now in its fourth year, "You
kept hearing you can't have an economic recovery until you had
participation by the housing market. It started in the middle of
last year, in the June-July time frame. So now, almost a year
later, it's pretty clear that has happened," said Frederick.
The Dow Jones Industrial Average (DJI) rose 83.43 points to
15,386.23, with 23 of its 30 components advancing.
Bank of America Corp. (BAC) led blue-chip gains.
Dow member Alcoa Inc. (AA) fell 0.1% after Moody's Investors
Service reduced its rating on the aluminum manufacturer's debt to
one notch below investment grade.
With one trading session remaining in May, the S&P 500 index
(SPX) is up 4% month-to-date, positioning for it for a seventh
consecutive monthly gain, which would be its longest monthly win
streak since one ending in September 2009.
On Thursday afternoon, the S&P 500 index added 11.75 points
to 1,660.11, with financials leading sector gains and
telecommunications losing the most ground among its 10 major
industry groups.
"Those pundits that had you reaching for yield for the last few
months in the utilities, REITS (real estate investment trusts) and
telephone sectors are all hiding under a rock now," Elliot Spar,
market strategist at Stifel, Nicolaus & Co., wrote in afternoon
commentary.
"In the last few days many defensive names have come under
pressure as money flowed out of them into cyclicals," said Spar,
adding that part of the catalyst for the flow was the 10-year
Treasury yield remaining over 2%.
A clear break of support at 2% "could be the catalyst for some
profit-taking in the cyclical and financials that have attracted
money," he concluded.
On Thursday, Treasury prices fell, with the 10-year yield
(10_YEAR) lately at 2.122%.
The Nasdaq Composite (RIXF) climbed 35.52 points to
3,503.91.
For every stock on the decline, nearly two gained on the New
York Stock Exchange, where 422 million shares traded as of 3:05
p.m. Eastern.
Composite volume exceeded 2.5 billion.
A volatile Japanese market remained in the headlines. The
Japanese yen (USDJPY) fell against the U.S. dollar (DXY) and Japan
equity index futures bounced higher after Reuters reported a
proposed change in Japan's public pension fund's strategy would
likely bolster equity markets while denting the nation's currency.
U.S. stock-index futures also gained after that report.
Gold futures gained $20.20 to end at a more-than-two-week high
of $1,412 an ounce on the Comex division of the New York Mercantile
Exchange. And, crude-oil futures (CLN3) reversed course to settle
up 48 cents att $93.61 a barrel on the New York Mercantile
Exchange.
Noteworthy movers on Thursday included Clearwire Corp. (CLWR),
up 26%, after Dish Network Corp. (DISH) upped its offer for the
company, upping the ante in a bidding competition with Sprint
Nextel Corp. (US-S)
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