Dow hits another record, driven by commodities
NEW YORK – The Dow Jones industrial average closed at another record high, driven by a surge in materials companies.
The Dow gained almost 60 points to 14,673 Tuesday, an increase of 0.4 percent. The Dow most recently set a record a week ago. It's up 12 percent this year.
The Standard & Poor's 500 rose five points, or 0.4 percent, to close at 1,568. That's less than two points from the record high the index reached last week.
The Nasdaq rose 15, or 0.5 percent, to 3,237.
Materials stocks led the gains following a surge in prices for commodities like copper. Cliffs Natural Resources jumped 9 percent.
Three stocks rose for every two that fell on the New York Stock Exchange. Trading volume was relatively light at 3.2 billion shares.
The prices of metals like copper, gold and silver have rebounded this week after slumping for the first three months of the year on waning demand. Oil is also rising following a sharp decline last week.
"You're seeing some pretty decent action in the overall market, with today's leadership coming from the basic materials sector," said Robert Pavlik, chief market strategist at Banyan Partners. "It's an area of the market that does represent some value because it's underperformed."
Material companies were the biggest gainers of the 10 industry groups in the S&P 500, rising 1.2 percent. Energy companies posted the second best return, advancing 1 percent.
The stock of First Solar Inc. soared after the solar panel maker issued a better-than-expected outlook for 2013 and solid predictions for the following two years, helped by continued growth in shipments. The stock price rose nearly $13, or 46 percent, to $39.52.
The stock market has mostly moved sideways since the middle of March. The Dow has alternated between small gains and losses, after starting the year on a tear. Signs of slowing growth and concerns about the outlook for Europe had checked investors' confidence.
Alcoa, traditionally the first company in the Dow to report results, was little changed after the company posted its earnings late Monday. The aluminum producer's earnings beat Wall Street's expectations but the company was still weighed down by depressed aluminum prices, which offset strong demand from auto and plane makers.
Online auto retailer CarMax, home goods retailer Bed Bath & Beyond and banks Wells Fargo and JPMorgan Chase are among companies that will report earnings later this week.
Investors will be looking to see whether companies are feeling an impact from government spending cuts that kicked in recently, said Jim Russell, investment director at U.S. Bank. They will also want to know what impact there will be from the ongoing debt crisis in Europe.
"The market is looking for companies to fill in those blanks," said Russell.
J.C. Penney Co. plunged 12 percent following its ouster of CEO Ron Johnson after only 17 months on the job. J.C. Penney announced late Monday that it had rehired Johnson's predecessor, Mike Ullman, who was CEO of the department store operator for seven years until November 2011.
Analysts and investors are questioning whether Ullman has what it takes to turn around the retailer's fortunes after sales plummeted under Johnson's reign.
While stocks are struggling to extend their gains from the start of the year, bonds have rallied.
The yield on the 10-year Treasury note was unchanged at 1.75 percent. But the benchmark rate has fallen from a high of 2.06 percent reached March 11 as demand for low-risk assets increases.