U.S. stocks advanced, after equities fell yesterday for the first time in three days, as Tiffany (TIF) & Co. rallied and investors speculated the economy is strong enough to weather further stimulus cuts by the Federal Reserve.
Tiffany gained 8.4 percent to lead an advance among retailers as quarterly profit beat estimates. Netflix Inc. rose 2.3 percent after saying it will expand its online-video service in Europe. Benchmark indexes pared gains as the Russell 2000 Index of smaller companies reversed an earlier 0.9 percent gain.
The Standard & Poor’s 500 Index (SPX) added 0.5 percent to 1,881.17 at 12:17 p.m. in New York. The equity benchmark is about 0.9 percent away from a record reached on May 13. The Dow Jones Industrial Average climbed 116.59 points, or 0.7 percent, to 16,490.9. Trading in S&P 500 companies was 22 percent below the 30-day average for this time of day.
“The equity markets are moving higher today based off of the expectation of stronger economic growth,” Chad Morganlander, a fund manager at Stifel Nicolaus & Co., which oversees $160 billion, said by phone from Florham Park, New Jersey. “Economic growth as well as earnings will begin to accelerate in the warmer months which will increase investors’ risk appetites.”
The Fed releases minutes from its April 29-30 meeting at 2 p.m. in Washington. Policy makers said last month the economy is showing signs of picking up and the job market is improving. The central bank pared its monthly asset buying to $45 billion in April, its fourth straight $10 billion cut, and said further reductions in measured steps are likely.