Banks Lead Up Market
Business Roundup for Wednesday, January 15
It was a stock market squeaker.
After piercing its all-time high in early trading, then yo-yoing below and above that level several times during the day, the Standard and Poor's 500 index on Wednesday managed to eke out a record at the close, besting the old one by just two-hundredths of a point.
Financial and technology companies had some of the biggest gains. Bank stocks rose after Bank of America reported that its profit surged to $3.44 billion in the fourth quarter. Apple was up nearly 2 percent.
Investors have been worried stocks would stall in the new year after a surge of nearly 30 percent in the S&P 500 last year. The first few trading days in 2014 seemed to confirm their fears. As of the close of trading Monday, the S&P 500 was down 1.6 percent.
But a combination of positive economic reports and strong earnings on Wednesday sent all three major indexes higher.
The S&P 500 gained 9.50 points, or 0.52 percent, to 1,848.38. The last closing high was 1,848.36 on Dec. 31, 2013. With Wednesday's rise, the index is now basically flat for the year. In 2013 the S&P 500 closed at record highs 45 times.
The Dow Jones industrial average closed up 108.08 points, or 0.7 percent, to 16,481.94. It is 94.72 points from its closing high, just one good up day away. The Nasdaq composite rose 31.87 points, or 0.76 percent, to 4,214.88. The tech-heavy index is still 16 percent below its high during the dot-com bubble more than a decade ago.
WASHINGTON (AP) — The Federal Reserve's latest Beige Book survey shows gains in consumer spending and factory output helped keep economic growth healthy in most regions of the country in late November and December. The Fed says nine of its 12 banking districts described growth as moderate. Only two districts -- Boston and Philadelphia -- said growth was modest, while Kansas City said it "held steady."
RALEIGH, N.C. (AP) — President Barack Obama is following through on a year-old promise to set up hubs around the country for high-tech manufacturing. In North Carolina this afternoon, Obama announced that a consortium of 18 businesses and six universities led by North Carolina State University will spearhead the effort. The aim is to better focus on developing next-generation power electronics. He's dedicating $200 million in federal money to get three hubs up and running.
JUNEAU, Alaska (AP) — An Environmental Protection Agency report says large-scale copper and gold mining in Alaska's Bristol Bay region could have devastating effects on the world's largest sockeye salmon fishery and adversely affect Alaska Natives. The report concludes that up to 94 miles of streams could be destroyed by the mine's footprint, including up to 22 miles of streams known to provide salmon spawning and rearing habitat. The EPA says the assessment is intended to inform possible future government actions.
NEW YORK (AP) — Forbes magazine is leaving its New York City headquarters and moving hundreds of employees to New Jersey. Forbes Media says it has secured office space in the Newport area of Jersey City and plans to relocate by the end of this year. The move comes after New Jersey's Economic Development Agency approved a $27.1 million incentive over 10 years for Forbes.
NEW YORK (AP) — Bank of America says its fourth-quarter profit jumped nearly five-fold from a year earlier. The nation's second-largest bank earned $3.44 billion in the October to December period. On a per-share basis, the bank earned 29 cents, beating the 26 cents financial analysts expected. Profits got a big boost because Bank of America was able to significantly reduce the amount of money it holds on its balance sheet to protect itself from bad loans.
WASHINGTON (AP) — Wholesale prices increased in December. The Labor Department says its producer price index rose 0.4 percent from November. That ends three straight months of declines. Rising gasoline prices and energy costs contributed to the rise. Excluding volatile energy and food costs, core prices increased 0.3 percent in December.
BRUSSELS (AP) — The European Commission is taking new steps to get credit flowing again. It's easing rules for small- and medium-sized companies to get state-backed financing. Funding for many European small- and medium-sized companies dried up in the wake of the financial crisis as banks focused on replenishing their coffers and worried about the economic outlook.
FRANKFURT, Germany (AP) — Unemployment and a slow economic recovery continue to make Europe a money-losing market for Ford. The automaker says its sales there fell 2.1 percent last year. However, the company's president for Europe, Middle East and Africa see something positive in the numbers. Stephen Odell says sales to individuals rose 14 percent. Sales to company fleets and car rental companies aren't as profitable as retail sales.
TOKYO (AP) — International stock markets rose today as an upbeat World Bank assessment of the global economic outlook underpinned buying spurred by stronger U.S. retail sales. The dollar rose against the euro and the yen. Benchmark U.S. crude oil rose slightly to remain above $92.50 a barrel.
WASHINGTON (AP) — The Labor Department releases its producer price index for December this morning. Wholesale prices have fallen the three previous months, pushed down by cheaper gasoline and home heating oil costs. This afternoon the Federal Reserve releases its survey of regional business conditions known as the beige book. Some earnings reports are also expected.
UNDATED (AP) — A report by the Global Business Travel Association is predicting an upswing this year. The forecast say U.S. business travel spending is expected to rise 6.6 percent to $289.8 billion this year. A main driver is an anticipated more than 12 percent jump in spending on trips overseas to $36.7 billion as the eurozone recovers.
WASHINGTON (AP) — President Barack Obama intends to nominate Maria Contreras-Sweet, the founder of a Latino-owned community bank in Los Angeles and a former California cabinet secretary, to be head of the Small Business Administration. A White House official says Obama will announce Contreras-Sweet's selection at an event today. The Washington Post first reported the nomination.
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