Economic data boost S&P 500, U.S. stocks.
U.S. stocks continued higher on Wednesday after government data showed a surprise surge in manufacturing activity in January, raising optimism that the economic recovery was still on track.
All of Wall Street’s major indices reported gains, with the large-cap S&P 500 Index (NYSEARCA:SPY) climbing 0.8% to 2,810.99. That was its highest level since November. All 11 primary sectors finished higher, led by health care. Financials and information technology stocks also performed strongly.
The technology-focused Nasdaq Composite Index (NYSEARCA:QQQ) closed up 0.7% at 7,643.41.
The Dow Jones Industrial Average (NYSEARCA:DIA) rose more than 200 points before giving back some of its gains in afternoon trading. The blue-chip index closed up 148.43 points, or 0.6%, at 25,703.09.
A measure of implied volatility known as the CBOE VIX (NYSEARCA:VXX) reached a session low of 13.25, where it was on track for new yearly lows. The so-called “fear index” settled down 1.4% at 13.58.
In economic data, U.S. durable goods orders rose unexpectedly last month, a sign that manufacturing demand was improving. Orders for manufactured goods meant to last three years or more rose 0.4%, the Department of Commerce reported Wednesday. Analysts had expected a decline of 0.5%.
Nondefense capital goods orders excluding aircraft, a key proxy for business investment plans, jumped 0.8%.
Separately, construction spending rose 1.3% in January, more than offsetting the 0.8% drop the previous month. Analysts had called for a monthly gain of 0.4%.
The Final Word: Strong data provide investors with comforting reassurance that the U.S. economy was still on track. It remains to be seen whether stocks can extend their winning streak toward new record highs ahead of Q1 earnings season.