By Karen Langley and Caitlin Ostroff

The Dow Jones Industrial Average closed above 34000 for the first time Thursday after strong earnings and upbeat economic data sent stocks climbing.

The S&P 500 also notched a record close, its 22nd of the year. A powerful rally has pushed both indexes up 11% in 2021, and many investors believe the rollout of Covid-19 vaccines and plentiful government spending mean stocks have room to keep rising.

Shares of big tech companies pushed indexes higher as the yield on the 10-year U.S. Treasury note recorded its largest one-day decline since November. Falling yields tend to boost technology stocks, which often trade at high prices partly because of expectations of growth far into the future. Apple shares gained 1.9%, while Microsoft shares rose 1.5%.

The blue-chip index advanced 305.10 points, or 0.9%, to 34035.99, its 20th record close of the year. The S&P 500 added 45.76 points, or 1.1%, to 4170.42. The Nasdaq Composite climbed 180.92 points, or 1.3%, to 14038.76, off 0.4% from its February record.

First-quarter earnings season kicked off in earnest this week, and on Thursday several big banks reported profits that exceeded forecasts. Analysts expect that earnings among companies in the S&P 500 jumped 30% in the first quarter from the same period a year earlier, according to FactSet.

"There's elevated expectations coming into this quarter, but we still think that there's going to be a significant amount of companies beating those estimates," said Chad Oviatt, director of investment management at Huntington Private Bank.

On Thursday investors rewarded shares of several reporting companies. BlackRock shares gained $16.77, or 2.1%, to $817.84 after the asset manager said its quarterly profit rose nearly 50%. UnitedHealth Group shares climbed $14.38, or 3.8%, to $390.01 after the healthcare services company posted a larger profit and stronger revenue on the year in the first quarter.

Shares of Bank of America, by contrast, dropped $1.14, or 2.9%, to $38.74 after the lender reported a jump in expenses.

Money managers also parsed new data that suggest an acceleration in the economic recovery. U.S. retail sales -- a measure of purchases at stores, at restaurants and online -- jumped 9.8% last month. Household incomes have benefited from recent fiscal stimulus measures that saw $1,400 checks hit some Americans' bank accounts.

"Economic data is going to continue to get better and better and better as the economy opens up," said Tom Mantione, managing director at UBS Private Wealth Management.

Fresh data also showed that 576,000 Americans applied for first-time unemployment benefits in the week ended April 10, a decrease from the 769,000 who applied in the week prior. The Federal Reserve has said employment is one of the factors it is watching to determine when to eventually lift interest rates.

Despite the strong economic news, the yield on the benchmark 10-year U.S. Treasury note dropped to 1.531%, from 1.637% on Wednesday, indicating renewed demand for government debt.

"That is putting some pressure on the financial sector...and that is helping some of the growthier stocks do well," said Linda Bakhshian, senior portfolio manager at Federated Hermes. "I think the 10-year is really driving the action today."

Lower rates tend to crimp banks' net interest margins, a measure of lending profitability. The financial and energy groups were the only two of the S&P 500's 11 sectors to decline Thursday.

Among individual stocks, newly listed cryptocurrency exchange Coinbase ticked down $5.53, or 1.7%, to $322.75. Shares rose as high as $429.54 during the stock's trading debut Wednesday and ended the session at $328.28.

Overseas, the Stoxx Europe 600 gauge added 0.5%. The Shanghai Composite Index declined 0.5%, and Hong Kong's Hang Seng Index edged 0.4% lower. South Korea's Kospi added 0.4%.

Write to Karen Langley at karen.langley@wsj.com and Caitlin Ostroff at caitlin.ostroff@wsj.com

(END) Dow Jones Newswires

April 15, 2021 17:26 ET (21:26 GMT)

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