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Strong data pushes US stocks to new highs

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US stocks have resumed their upward push with both the Dow and S&P 500 closing at new all-time highs following favourable US economic reports.

The Dow Jones Industrial Average on Friday jumped 121.18 (0.80 per cent) to 15,354.40.

The broad-based S&P 500 rose 15.65 (0.95 per cent) to 1,666.12, while the tech-rich Nasdaq Composite Index added 33.72 (0.97 per cent) to 3,498.96.

Friday’s gains came on the heels of an 83.7 reading on the University of Michigan index of consumer sentiment, the highest number since 2007. Also, the Conference Board’s index of leading US economic indicators jumped by 0.6 per cent in April.

The consumer data “sparked the uptrend today”, said Andrew Fitzpatrick, director of investment at Hinsdale Associates. “It seems that consumers are feeling better and that could lead to some higher economic growth.”

Financial stocks were among the biggest winners, including JPMorgan Chase (+2.6 per cent), Goldman Sachs (+2.4 per cent) and Wells Fargo (+1.6 per cent).

Among industrial blue chips, Boeing gained 2.4 per cent and General Motors 3.2 per cent.

Oil refiner Tesoro Corp shot up 7.0 per cent after winning US antitrust approval to acquire BP’s Carson, California refinery for about $US1.2 billion ($A1.23 billion).

Defence and aerospace company Northrop Grumman rose 4.0 per cent after announcing a $US4 billion share repurchase plan that will retire 25 per cent of the company’s outstanding shares.

Department-store chain JC Penney sank 4.2 per cent after reporting that first-quarter net losses more than doubled from a year ago, to $US348 million.

The retailer recently rehired former chief executive Myron Ullman to try to lure back customers after a failed makeover attempt.

Industrial heavyweight Caterpillar picked up 1.0 per cent after announcing an agreement to cut $US135 million from the price of its acquisition of a Chinese mining equipment firm ERA Mining Machinery following allegations ERA inflated its financial results.

Bond prices fell. The yield on the 10-year US Treasury rose to 1.95 per cent from 1.87 per cent late on Thursday, while the 30-year increased to 3.17 per cent from 3.09 per cent. Bond prices move inversely to yields.