NASDAQ achieves a 13-year high

Reuters, NEW YORK

Thu, Nov 28, 2013 - Page 15

The NASDAQ composite index closed above 4,000 on Tuesday for the first time since 2000, while the Dow and S&P ended barely changed.

Retailers and homebuilders were among the best performing sectors, responding to stronger-than-expected earnings and robust housing market data.

Big-cap technology stocks helped the NASDAQ the most on Friday to finish above 4,000 for the first time since the dot-com bubble burst in 2000 and sent the tech-heavy index hurtling.

Tiffany & Co jumped 7 percent to US$88.02 and was the S&P 500’s top performer after the luxury retailer’s third-quarter sales topped expectations. The S&P retail index advanced 0.9 percent.

“The wealth effect because the stock market has gone up has definitely helped the upper-end folks,” Hodges Capital Management’s Gary Bradshaw said in Dallas, Texas.

Moreover, Bradshaw said gasoline prices were giving a potential boost to broad-based holiday spending. Wal-Mart Stores Inc shares rose 0.3 percent to close at an all-time high of US$80.86 a day after the retailer named a new chief executive.

Jos A Bank Clothiers Inc surged 11.2 percent to US$56.29 after Men’s Wearhouse offered to buy the company for US$55 per share in cash, a 9 percent premium to its Monday close. Men’s Wearhouse jumped 7.5 percent to US$50.60.

On the NASDAQ, Apple Inc gained 1.8 percent to US$533.40, Google Inc rose 1.2 percent to US$1,058.41 and Amazon.com Inc shares ended up 1.3 percent to US$381.37.

The Dow Jones industrial average ended up 0.26 point to 16,072.80. The Standard & Poor’s 500 Index gained 0.27 point, or 0.01 percent, to 1,802.75. The NASDAQ Composite Index rose 23.18 points, or 0.58 percent, to 4,017.75.

The S&P 500 has risen nearly 27 percent this year, primarily bolstered by expectations the Federal Reserve’s stimulus will continue at least until the end of the year.

The Walt Disney Co led the Dow in percentage gain, with shares rising 2.1 percent to US$71.18. The company announced better-than-expected earnings earlier in the month.

Goldman Sachs Group Inc says the S&P 500 Index will probably fall 10 percent in the next 12 months before rebounding to end the year at 1,900.

The 1,900 forecast implies about a 5 percent advance from today’s level. The 25 months since the S&P 500’s last 10 percent drop is the longest stretch without such a decline since 2007, according to S&P.

“It will be less smooth sailing,” said the bank’s chief US equity strategist, David Kostin, on Bloomberg Television’s Market Makers program.

“The likelihood is we will have something that will prompt a reduction — a retreat in the market, but overall the market should be improving, and that’s because the US economy will be getting better,” Kostin said.

Kostin predicts the S&P 500 will reach 2,100 by the end of 2015 and 2,200 by the end of 2016.

Economists surveyed by Bloomberg forecast US economic growth will accelerate to 2.6 percent next year and 3 percent in 2015, compared with a 1.7 percent expansion this year.

Additonal reporting by Bloomberg