S&P 500 Ends Trading With A Record High

S&P 500 Ends Trading With A Record High

Advances in financial shares provided the momentum for the S&P 500 (INDEXSP:.INX) as it closed at a record high. This follows the settlement between the Bank of America (NYSE:BAC) and MBIA (NYSE:MBI).

Shares of MBIA and the Bank of America went up following the announcement of the latter that it will settle claims with the former. MBIA and Bank of America shares went up by 45.4 percent and 5.2 percent respectively. This also resulted to a 1 percent increase in the financial sector of the S&P, which was given an additional push by the increase in Apple (NASDAQ:AAPL) shares.

The increases at the S&P 500 followed a solid run at the beginning of the year. Interest rates were also kept low by positive monetary policies, which have helped keep the market up. The S&P 500 has increased by 13.4 percent since the year started.

Barclays was among the leaders of the market followed by Apple, which have increased by 2.4 percent as it contributed to the increase at the Nasdaq (INDEXNASDAQ:.IXIC) and S&P.

Even as the S&P and the Nasdaq increased, the Dow Jones Industrial Index (INDEXDJX:.DJI) went down slightly by 0.03 percent. The S&P 500 increased by 0.19 percent as it closed at 1,617.50. The Nasdaq went up by 0.42 percent at 3,392.97.

Despite concerns on the global growth outlook due to weak economic data from China and the euro zone, gains were encouraged by the US payrolls report that was stronger than what was anticipated.

A statement from Warren Buffet last Monday indicated that bonds were not good investments when interest rates are low. Although stocks are priced reasonably, he is staying away from some sectors that are unpredictable in the long run.

However, a number of analysts are not optimistic of the strength of the rally. Platinum Partners president Uri Landesman indicated that most of the good news that have emerged in the market may not be substantiated and it may not allow bad news to come out.

Around 68.5 percent of companies have surpassed earnings estimates although estimates for the second quarter may be going in the opposite direction. Among the shares that declined included Tyson Foods Inc (NYSE:TSN), Johnson & Johnson (NYSE:JNJ), and General Motors (NYSE:GM). On the other hand, Humana, Inc (NYSE:HUM) saw its shares increasing by 2.1 percent.

As the S&P 500 reached a record high, decliners were outpaced by decliners at the Nasdaq and the NYSE.

Posted by James Fried on Wednesday May 08 2013, 3:07 AM EST. Ref: Reuters. Link. All trademarks acknowledged. Filed under Finance. Comments and Trackbacks closed. Follow responses: RSS 2.0