Home Breaking News Stock market climbs after economic data, with banks in lead

Stock market climbs after economic data, with banks in lead


U.S. stocks rose on Thursday, with the advance gaining momentum throughout the session as financial shares rallied in response to a positive read on economic growth.

The Dow Jones Industrial Average

DJIA, +0.31%

 rose 88 points, or 0.4%, to 20,747. The S&P 500 index

SPX, +0.26%

 added 9 points, or 0.4%, to 2,370. The Nasdaq Composite Index

COMP, +0.15%

 climbed 18 points, or 0.3%, at 5,915. All three saw a lackluster start to trading, posting small moves on the day, but strengthened throughout the morning.

Earlier, the government said the U.S. economy, as measured by gross domestic product, expanded at a 2.1% annualized pace in the fourth quarter, slightly faster than the previously reported 1.9% rate. Separately, first-time jobless claims fell by 3,000 to 258,000 in the latest week, near their lowest level in decades.

“This is a market that looks like it may be gaining some traction as we go into the end of the month. The upward revision to GDP suggests economic momentum, and that’s providing some lift,” said Alan Gayle, director of asset allocation and senior investment strategist at RidgeWorth Investments.

The data helped support financial stocks, which are closely correlated to the pace of economic growth and were the biggest gainers in S&P 500 on the day, up 1%. Regional banks in particular enjoyed sharp moves higher, highlighted by a 2.4% gain for Zions Bancorp

ZION, +2.37%

 while Regions Financial

RF, +2.38%

 was up 2.1%. The SPDR S&P Regional Banking ETF

KRE, +2.69%

 popped 2.4%.

With the day’s move, the S&P 500 moved into positive territory for March, up 0.3%. The Dow remains down 0.3% for the month.

Recent gains have been slight, and of the past seven sessions for the S&P 500, not including Thursday, only one has ended with a move greater than 0.2% in either direction. This rangebound trading may be a sign that recent upward momentum on Wall Street may be stalling, even as major indexes continue to trade near records.

Daily moves have flattened ever since a Republican health-care bill was pulled from the House floor on Friday after the White House and Republican leaders were unable to overcome resistance within their own party. The failure raised questions about the Trump administration’s ability to pass its economic agenda, which had been seen as market friendly.

“If Congress gets bogged down with its tax and spending plans, as it is often plagued to do, that could leave the market quite vulnerable,” Gayle said. “We need to see some tangible progress in the second quarter, otherwise confidence will erode.”

Read: Here’s what would happen during a government shutdown

Fed speakers: Cleveland Fed President Loretta Mester forecast GDP growth above 2% in 2017, and sees a “sustained return” to 2% inflation “over the next year or so.” Mester also expects the Fed to raise interest rates again this year, but didn’t say how many times might be likely. Currently, market participants anticipate three or four hikes in total over 2017.

Airlines speed up recovery of lost luggage

Big airlines will soon allow travelers to electronically tell carriers where to deliver their lost luggage.

Stock movers: Cenovus Energy Inc.

CVE, -11.86%

 fell 11% after ConocoPhillips

COP, +9.13%

 said it would sell the majority its Canadian oil-sands assets to the oil company. ConocoPhillips shares were up 9%.

Lululemon Athletica Inc.

LULU, -22.96%

 shares fell more than 22%, with several analysts cutting price-targets on the retailer, which forecast lower profit and sales in the first quarter and missed fourth-quarter earnings expectations.

Apple Inc.

AAPL, -0.15%

 was slightly higher, but the largest U.S. company closed at a record for the second straight day on Wednesday. That was also its sixth record thus far in March.

Read: Tesla now lets you doodle in your car

Other markets: European stocks

SXXP, +0.51%

 were tilting higher, with Germany’s DAX

DAX, +0.44%

on track for its highest close since April 2015. In Asia

ADOW, +0.01%

equities saw broad losses, with the Nikkei 225 index

NIK, -0.80%

 closing 0.8% lower.

Gold prices

GCJ7, -0.41%

 fell 0.4%, while oil prices

CLK7, +1.72%

 rose 0.6%.

The euro

EURUSD, -0.3715%

 extended its decline against the dollar, after a Reuters report that European Central Bank policy makers want to tamp down expectations for their policy announcement in April.

See: Euro bulls just got a wake-up call from the ECB

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