Tuesday, March 25 15:31:32
U.S. stocks rose today as many of the market's biggest trading favorites regained their momentum and a strong read on consumer confidence boosted optimism about economic conditions.
Consumer confidence rose more than expected in March, climbing to its highest level since January 2008. The report was the latest in a string of positive reads on the economy that supported theories that softness early this year was related to bad weather and not weakening fundamentals.
Investors continued to watch global issues cautiously. On Monday, major indexes fell on concerns that the crisis in Ukraine could escalate, pushing traders to take profits in such high-flying sectors as biotech and Internet shares. Those names rebounded on Tuesday, with some of Monday's biggest decliners topping the list of advancing S&P 500 names.
Biotech shares snapped a four-day losing streak to rise 1.7 percent. Alexion Pharma rose 2.4 percent to $153.29, while Regeneron Pharma was up 2 percent at $312.41. Among Internet names, which have also been hit by accusations that they are overpriced, Facebook Inc added 2.1 percent to $64.97.
The rebound in some so-called "momentum" names was an indication that while concerns persist about geopolitical tensions in Ukraine and slowing growth in China, investors are not so bearish on equities as to sell them wholesale. The CBOE Volatility Index, a gauge of investor anxiety, fell 5.6 percent and remains at historically low levels.
"Investors become momentarily concerned about valuation, but that pullback was healthy, and we could see modest gains from here just because equities remain the most attractive place to be," said Kristina Hooper, head of portfolio strategies at Allianz Global Investors in New York, which has $475 billion in assets under management.
"Biotechs continue to look attractive since they offer a higher level of growth, and in face they look more attractive than they did because valuations improved in the selloff."
McCormick and Co and Walgreen Co were the S and P 500's two biggest gainers after reporting quarterly results. Both posted sales increases, but Walgreen said a slowdown in the introduction of higher-profit generic medicines cut into its gross profit margin.
McCormick rose 5.7 percent to $71.43 while Walgreen added 4.5 percent to $67.24.
The Dow Jones industrial average was up 94.93 points, or 0.58 percent, at 16,371.62. The Standard and Poor's 500 Index was up 9.83 points, or 0.53 percent, at 1,867.27. The Nasdaq Composite Index was up 31.33 points, or 0.74 percent, at 4,257.71.