US stocks closed out a buoyant month with a fresh record for the S&P 500, as bullish sentiment dominated trade despite mediocre economic data and rising tensions over the Ukraine.
The S&P 500 was the week’s star, notching consecutive records on Thursday and Friday to finish the week up 23.2 points, or 1.26 percent, at 1,859.45. The Dow Jones Industrial Average also gained this week, rising 218.41 points (1.36 percent) to close at 16,321.71, while the tech-rich NASDAQ Composite Index tacked on 44.71 (1.05 percent) to end on 4,308.12.
Last month, the Dow jumped 3.97 percent — its biggest monthly gain since January last year —while the S&P 500 rose 4.31 percent and the NASDAQ powered up 4.98 percent.
Investor enthusiasm returned last month after the Dow fell 5.3 percent in January.
“The US is the place to be in terms of stocks,” Wells Fargo Advisors senior equity strategist Scott Wren said.
Wren this week bumped his year-end forecast for the S&P 500 up on expectations of “modest,” but “dependable” growth in the US.
The week’s gains underscored the strong appetite for stocks even as tensions rose over turmoil in the Ukraine, Meeschaert Capital Markets president Gregori Volokhine said from New York.
Volokhine described the situation as potentially “explosive geopolitically” because of the possibility that the US could take “economic action” against Russia over the crisis-hit country.
Investors also shrugged off another round of mostly disappointing economic data that included a big reduction in the US Department of Commerce’s estimate for fourth-quarter economic growth from 3.2 to 2.4 percent.
However, analysts said investors view GDP data and other weak indicators as resulting partly from extremely cold weather that has depressed economic activity recently.
US Federal Reserve Chair Janet Yellen took this stance, telling a US Senate panel that “unseasonably cold weather has played some role” in many of the lackluster economic statistics released over the past four to six weeks.
Analysts said Yellen’s testimony confirmed that while the Fed continues to scale back its stimulus program, it has no intention of raising interest rates anytime soon.
Yellen “restated that the Fed is very likely to keep interest rates at a very low level for the foreseeable future,” Hugh Johnson Advisors chairman Hugh Johnson said..
Major corporate news this week included earnings reports from leading retailers Best Buy Co Inc, Macy’s Co and Home Depot Inc, all of which rallied following the releases.
One of the most anticipated reports came from Target Corp, which in December last year disclosed that credit card data for about 40 million of its customers had been stolen by hackers in one of the biggest data breaches in history.
Target said its fourth-quarter earnings fell 45.9 percent last year because of lower consumer traffic after it disclosed the breach. It also warned that its full-year earnings for this year could be hit by costs from the data breach.
Nevertheless, Target shares rallied after the report because of relief that it was not worse.
Shares of another problem-plagued retailer, JC Penney, also soared after the firm projected that it would see “mid-single-digit” growth in same-store sales this year.
Ripples from several high-profile shareholder activist battles also garnered headlines. Billionaire Carl Icahn engaged in an escalating war of words with eBay Inc, while Dan Loeb announced plans for a proxy battle to win three board seats at Sotheby’s and PepsiCo again rejected calls from activist Nelson Peltz to spin off its North American beverage business.
With most corporate earnings complete, next week’s calendar will be dominated by economic reports.
The schedule includes data on the US trade balance and construction spending and culminates with the monthly jobs report for last month on Friday.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
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FUTURE PLANS: Although the electric vehicle market is getting more competitive, Hon Hai would stick to its goal of seizing a 5 percent share globally, Young Liu said Hon Hai Precision Industry Co (鴻海精密), a major iPhone assembler and supplier of artificial intelligence (AI) servers powered by Nvidia Corp’s chips, yesterday said it has introduced a rotating chief executive structure as part of the company’s efforts to cultivate future leaders and to enhance corporate governance. The 50-year-old contract electronics maker reported sizable revenue of NT$6.16 trillion (US$189.67 billion) last year. Hon Hai, also known as Foxconn Technology Group (富士康科技集團), has been under the control of one man almost since its inception. A rotating CEO system is a rarity among Taiwanese businesses. Hon Hai has given leaders of the company’s six