U.S. stocks rose on Thursday, with the S&P 500 at fresh 2-1/2 month highs as technology sector earnings continued to shine despite weak economic data.
A strong full-year outlook from IBM, bullish earnings from eBay and Qualcomm’s expectations for a “strong December quarter” boosted technology shares.
The market briefly pared gains in early trading after data showed manufacturing in the U.S. mid-Atlantic region shrank for a third month and home resales were lower than forecast. Separate data showed more Americans applied for unemployment insurance than expected in the latest week.
“It is baked into stock prices that growth is going to be slow for a little while,” said Giri Cherukuri, head trader at OakBrook Investments in Lisle, Illinois.
“People are focusing on individual stocks after earnings and trying to figure out (through) outlooks how weak the economy really is,” he said.
Record high prices in Treasuries have kept yield-seekers focused on stocks despite a softening economy. A vigilant Federal Reserve is also credited for helping equities hold amid poor economic data. Previous Fed actions to bolster the economy have triggered rallies in equity and commodity markets.
The Dow Jones industrial average rose 29.90 points, or 0.23 per cent, to 12,938.60. The S&P 500 Index gained 3.66 points, or 0.27 per cent, to 1,376.44. The Nasdaq Composite added 23.70 points, or 0.81 per cent, to 2,966.30. The S&P/TSX rose 61.63 points to 11,640.78.
IBM shares jumped 3.5 per cent to $194.89 a day after it raised its full-year profit forecast.
Qualcomm cut its revenue and earnings forecast for the current quarter but investors took heart as it said sales would improve for a strong last quarter of 2012, sending its shares up 3.8 per cent to $58.19.
EBay shares jumped 8.3 per cent to $43.82 after it posted stronger-than-expected quarterly revenue and earnings as more consumers shopped on its online marketplaces and used its PayPal payment service.
U.S.-traded shares of Mellanox Technologies touched their life high after the chipmaker’s profit beat analysts’ expectations. Mellanox, up about 40 per cent at $92.61, was the biggest boost to the PHLX semiconductor index.
Walgreen shares soared 10.6 per cent to $34.26 and Express Scripts Holding added 1.8 per cent to $58.73 after the companies said they struck a pharmacy network agreement that settles a long-running dispute.
Walgreen competitor CVS Caremark fell 4.6 per cent to $46.19.
Morgan Stanley fell 4.2 per cent to $13.40 as quarterly revenue declined due to a slowdown in trading and dealmaking volumes.
Nokia reported a smaller loss than expected and ended the quarter with more cash than investors had expected. U.S.-listed shares of the company climbed 7.5 per cent to $1.86.
Google shares rose 2.1 per cent to $593.19. The company reports its earnings after the closing bell.Report Typo/Error