U.S. Stocks Rise in S&P 500's Best Week Since March

Wall Street managed a fourth day of gains as the strong earnings season outweighed a surprisingly weak reading on first-quarter economic growth.


Online retailer Amazon climbed 15.7 percent to $226.85 and contributed half of Nasdaq's gain for the day. An S&P retail index rose 3.5 percent and hit an all-time high. Shares of Expedia, the Web-based travel provider, surged 23.5 percent to close at $40.31, after hitting a new high at $43 on record volume.

Growth in S&P 500 earnings rose to 7.2 percent this week from 3.2 percent at the start of the month, according to Thomson Reuters data. About 73 percent of the companies that have reported so far have beaten expectations.


"So far the numbers have been pretty good, and we're happy about that, but I think we have to wait to where we're done with the earnings season to really make judgments," said David James, senior vice president of James Investment Research in Alpha, Ohio.


"Going forward, the big key for people especially looking at tech is what happens with the dollar. I think the dollar will probably be stronger than people expect on a relative basis. Historically that usually means tech is the sector that gets hit the hardest."


The Dow Jones industrial average was up 23.69 points, or 0.18 percent, at 13,228.31. The Standard & Poor's 500 Index was up 3.38 points, or 0.24 percent, at 1,403.36. The Nasdaq Composite Index was up 18.59 points, or 0.61 percent, at 3,069.20.


Gauges for phone stocks, consumer discretionary and technology companies advanced the most among 10 groups in the S&P 500, jumping at least 2.4 percent. An index tracking homebuilders surged 10 percent to the highest level since 2008 amid better-than-estimated housing data and PulteGroup Inc. (PHM)’s narrower loss. Apple rallied 5.2 percent after profit almost doubled while Amazon.com surged 19 percent.

The S&P 500 rose 1.8 percent to 1,403.36 for the biggest weekly advance since March 16. The Dow Jones Industrial Average gained 199.05 points, or 1.5 percent, to 13,228.31.
Earnings “look really strong, but that is definitely a management of expectations by companies,” Gary Flam, who helps oversee $6.7 billion for Bel Air Investment Advisors LLC in Los Angeles, said in a telephone interview. “If economic data weakens, QE3 or some type of response from the Fed can be expected. That’s also giving investors some confidence,” he said, referring to a third round of stimulus measures known as quantitative easing.
The Fed on April 25 upgraded its estimates for growth and unemployment this year while repeating its view that borrowing costs are likely to remain “exceptionally low” at least through late 2014. Signed contracts to buy U.S. homes increased more than forecast in March, a sign that the housing market may be reaching bottom after a six-year price slump.