Los Angeles Times

Stocks climb on strength of quarterly earnings data

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Healthcare and energy companies helped push stocks higher Monday, as Wall Street kicked off the first trading day in May with more gains after a fourmonth winning streak.

The Standard & Poor’s 500 index rose 0.3%. Industrial and financial stocks also helped lift the market. Falling technology and communicat­ion stocks, and companies that rely on consumer spending, kept the market’s gains in check. Treasury yields were mixed.

Investors welcomed new economic data indicating the economy is strengthen­ing. They also continued to focus on the latest batch of corporate earnings reports, which have been mostly encouragin­g and have helped fuel optimism about a solid economic recovery this year.

The S&P 500 rose 11.49 points to 4,192.66. The benchmark index’s latest gains follow a 5.2% surge in April, its best month since November 2020, when President Biden was elected. It logged a gain of about 28% from November through April.

The Dow Jones industrial average added 238.38 points, or 0.7%, to 34,113.23. The techheavy Nasdaq shed an early gain and lost 67.56 points, or 0.5%, to 13,895.12.

Smaller companies, which have outgained the broader market this year, also had a good showing. The Russell 2000 index picked up 11 points, or 0.5%, to 2,277.45.

Stocks have been grinding higher on expectatio­ns of an economic recovery and strong company profits this year as large-scale coronaviru­s vaccinatio­n programs help people return to jobs and normality after more than a year of restrictio­ns. Massive support from the U.S. government and the Federal Reserve, and increasing­ly positive economic data, have also helped put investors in a buying mood, keeping stock indexes near their all-time highs.

This will be another busy week for earnings reports, with Merck, Pepsi, ColgatePal­molive and CVS among the companies reporting their latest quarterly results. Investors will also get April’s jobs report Friday.

Among the biggest gainers Monday were oilfield services company Baker Hughes, which vaulted 8%, clothing retailer Gap Inc., which jumped 7.2%, and flooring manufactur­er Mohawk Industries, which climbed 7.5%.

Shares of Verizon Communicat­ions added 0.2% after the company announced it would sell off the remnants of Yahoo and AOL into a new company backed by private equity firm Apollo Global Management. Verizon bought Yahoo and AOL’s media assets about six years ago to compete with Google and Facebook, but the effort never panned out and Verizon returned its focus to its traditiona­l wireless cell operations.

Warren Buffett’s Berkshire Hathaway rose 1.5% after the billionair­e investor named his successor after years of speculatio­n. Greg Abel, who runs Berkshire Hathaway’s noninsuran­ce business, will step into the chief executive role when Buffett retires.

On the economic front, a report on U.S. manufactur­ing activity in April came in below economists’ expectatio­ns but still was strong for the month. The Institute for Supply Management’s manufactur­ing index came in at 60.7 for April, compared with the 65.0 reading that was expected. That figure is still well above the 50-point mark that indicates expanding manufactur­ing activity.

A report on U.S. constructi­on spending showed similar results, making gains but still falling short of economists’ forecasts. Spending on constructi­on projects rose just 0.2% in March, the Commerce Department said Monday, significan­tly less than the 1.7% jump economists had expected.

The yield on the 10-year U.S. Treasury note slipped to 1.60% from 1.65% late Friday.

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