Rebound continues
S&P and Nasdaq back at early May levels
NEW YORK – It was a day of milestones for the stock market.
Stronger corporate earnings reports and expectations that central banks will act to support the economy powered the Standard & Poor’s 500 index past 1,400 for the first time in three months. The index rose 7.12 points to close at 1,401.35 on Tuesday. Energy stocks increased the most of the 10 industry groups tracked by the index.
The Nasdaq composite index marked a milestone of its own: the first close above 3,000 since early May. The Nasdaq rose 25.95 points to 3,015.86.
The S&P hasn’t closed above 1,400 since May 2, and the Nasdaq hasn’t closed above 3,000 since May 3.
“There’s been a bunch of positive earnings numbers,” said Stephen Carl, head of equity trading at The Williams Capital Group.
The Dow Jones industrial average rose 51.09 points to 13,168.60.
Energy companies rose broadly after Chesapeake Energy reported that its income doubled in the second quarter. Revenue from oil, natural gas and natural gas liquids rose. Chesapeake’s stock soared $1.67 to $19.37, lifting other energy stocks with it – Cabot Oil & Gas jumped $2.09 to $42.88 and Occidental Petroleum rose $2.48 to $90.74.
Chesapeake was the latest major U.S. company to turn in a stronger earnings report. Of the 430 companies in the S&P 500 that have reported earnings through Tuesday, 65 percent beat Wall Street’s expectations, according to S&P Capital IQ. More than 43 percent have reported double-digit growth.
On Tuesday, accessories maker Fossil reported that its second-quarter net income climbed 12 percent thanks to growing demand in Asia and strong watch sales. The performance topped analysts’ estimates, and the stock popped $21.98, or 31.5 percent, to $91.77, the biggest gain in the S&P 500 index.
Recent comments by Federal Reserve chairman Ben Bernanke that the slow economic recovery has hurt many Americans has kept hope alive that the Fed will take more steps to kick-start the economy at its next meeting in September.