CORRECT: US Stocks End At Multiyear Highs On US Manufacturing Report

Date : 04/02/2012 @ 7:28PM
Source : Dow Jones News
Stock : Hartford Financial Services Grp. (The) (HIG)
Quote : 55.42  0.13 (0.24%) @ 12:08PM

CORRECT: US Stocks End At Multiyear Highs On US Manufacturing Report

Hartford (NYSE:HIG)
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NEW YORK (Dow Jones)--Stocks rose to multiyear highs on the first session of the new quarter after a solid reading on domestic manufacturing.

Major indexes started near the flat line but drifted higher as a result of the report on March manufacturing activity. The Dow Jones Industrial Average climbed 52.45 points, or 0.40%, to 13264.49, its highest close since December 2007.

On Friday, the Dow rose 66 points to close out the best first-quarter point gain--994.48 points--in its history, and the best first-quarter percentage performance--8.1%--since 1998.

The Standard & Poor's 500-stock index gained 10.57 points, or 0.75%, to 1419.04, its highest finish since May 2008. The Nasdaq Composite rose 28.13 points, or 0.91%, to 3119.70.

"After a massive run, what's better than putting a cherry on top?" said Barry James, president of James Investment Research. "When you've got the market running higher, it likes to keep going higher until something really takes place. From an economic standpoint, there are enough positive markers for people to say that's OK right now."

All 10 sectors of the S&P 500 advanced, paced by the materials and technology sectors. Oil-and-gas company Denbury Resources rose, while coal producer Alpha Natural Resources increased.

Beauty-products seller Avon Products led the index higher, climbing 17% after receiving a $10 billion buyout offer from Coty, a closely held fragrance company. Avon rejected the bid, saying it was opportunistic and substantially undervalued the company.

The U.S. manufacturing sector's expansion continued in March and employment perked up, according to data released by the Institute for Supply Management. "The ISM number is a positive sign for the market but still pretty much flat," said Joe Bell, senior equity analyst at Schaeffer's Investment Research. "It's probably going to be a slow week, with a lot of eyes on the unemployment results on Friday."

But spending on construction projects in the U.S. fell for the second straight month in February, showing the sector is struggling to build on momentum late last year. The drop was the biggest since July and fell short of economists' average forecast for an increase.

In Europe, the Stoxx Europe 600 index gained 1.5%, with the U.S. manufacturing data providing a boost. The U.K.'s FTSE 100 index rose 1.9% and Germany's DAX index advanced 1.5%.

Asian bourses were mixed following a reading of Chinese manufacturing activity. The government's survey showed a strong expansion in activity in March, but that was in contrast to readings of contraction shown by an HSBC survey over a week ago. Hong Kong's Hang Seng Index slipped 0.2% while Japan's Nikkei Stock Average tacked on 0.3%.

Crude-oil prices rose 2.1%, to settle at $105.23 a barrel, while gold prices rose 0.5% to settle at $1,677.50 a troy ounce. The dollar gained ground against the euro but slipped against the yen. The yield on the 10-year Treasury note fell to 2.196%.

In other corporate news, Groupon slumped 17% after the online coupon provider revised lower previously reported fourth-quarter earnings and revenue as a result of an increase to its refund reserve accrual. In addition, Groupon said its independent auditor included a statement of a material weakness in its internal controls in its annual 10-K filing with the Securities and Exchange Commission.

Keryx Biopharmaceuticals plunged 65% after the company said a Phase III trial to evaluate its treatment for colorectal cancer didn't meet the primary endpoint. Keryx is the licensee partner of Canada's Aeterna Zentaris, which also tumbled.

Theravance climbed 19% as it entered into a deal in which GlaxoSmithKline would increase its ownership in Theravance by 10 million shares. Following the purchase, Glaxo would own 25.81 million, or about 26.8% of outstanding Theravance shares.

Hartford Financial Services Group rose 4.1% after agreeing to pay $2.43 billion to buy back securities it sold to Allianz in the depths of the financial crisis. The agreement allows Hartford to replace $1.75 billion it owes to Allianz with new debt at a lower cost.

Express Scripts added 2.4% after closing its $29.1 billion acquisition of peer Medco Health Solutions. The deal followed a Federal Trade Commission decision that the combination of the two largest pharmacy-benefits management companies in the U.S. wouldn't change the competitive landscape in the sector.

Wireless broadband network services provider Towerstream jumped 9.9% after disclosing a Wi-Fi agreement with a national wireless carrier.

Abercrombie & Fitch climbed 4.1% after Brean Murray analysts raised their rating on the teen clothing-retailer's stock to "buy," saying the "worst appears over" for the company.

Regional carrier Pinnacle Airlines tumbled 49% after filing for Chapter 11 bankruptcy protection. The Memphis, Tenn.-based carrier is seeking to restructure its agreements with Delta Air Lines and cut ties with United Airlines and US Airways Group.

-By Matt Jarzemsky, Dow Jones Newswires; 212-416-2240;

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