S&P 500 eyes best winning streak in eight years
By Edward Krudy | January 26, 2013 1:21 AM EST
Stock futures climbed on Friday and the S&P 500 was poised for an eighth day of gains, its longest winning streak in eight years, buoyed by rosy earnings from Procter & Gamble amid a backdrop of sturdy corporate results.
The equity market was also boosted by agreement in Washington to extend the government's borrowing power through mid-May, encouraging signs of recovery in the global economy, solid corporate earnings, and seasonal inflows into stocks.
Those factors helped the S&P 500 rally for a seventh day on Thursday to a five-year peak. Still, the index struggled to climb convincingly above 1,500, a level it surpassed briefly Thursday for the first time since December 2007.
"We are seeing a very broad-based rally and the ingredients are still in place" for gains to continue, said Steve Goldman, principal at Goldman Management in Short Hills, New Jersey. "This is the lift-off phase and it's still significant."
Procter & Gamble
S&P 500 futures rose 3.6 point and were above fair value, a formula that evaluates pricing by taking into account interest rates, dividends and time to expiration on the contract. Dow Jones industrial average futures rose 32 points and Nasdaq 100 futures rose 9.75 points.
If the S&P 500 rises for an eighth day, it will be its longest winning streak since late 2004, when it enjoyed a nine-day run.
Pointing to a rotation out of bonds, U.S. 30-year Treasury bonds traded more than a point lower in price on Friday, with yields touching session highs at 3.10 percent.
"You have had more confidence from fund managers to provide more allocations to equity markets," which looked more attractive than bonds or cash, said Rick Meckler, president of investment firm LibertyView Capital Management.
Recent company earnings have been encouraging. Thomson Reuters data through early Thursday showed that of the 133 S&P 500 companies that have reported earnings so far, 66.9 percent exceeded expectations, more than the 65 percent average over the past four quarters.
Apple stepped up audits of working conditions at major suppliers last year, discovering multiple cases of underage workers, discrimination and wage problems. The shares, which fell 12 percent Thursday after disappointing earnings, edged up 0.5 percent to $452.90.
German business morale improved for a third consecutive month in January to its highest in more than half a year, providing further evidence that growth in Europe's largest economy was gathering speed after contracting late last year.
Echoing a more positive tone in Europe, ECB President Mario Draghi said on Friday he expects the euro zone economy to recover later this year, and that financial market improvements had not yet trickled into the general economy.
(Editing by Bernadette Baum)
Most Popular Slideshows
- Gennady Golovkin Next Fight Options: Canelo Alvarez, Miguel Cotto Or Julio Cesar Chavez Jr.
- NFL MNF: Pittsburgh Steelers 30, Houston Texans 23 [PHOTOS]
- 2014 MLB World Series Game 1: San Francisco Giants 7, Kansas City Royals 1 [PHOTOS]
- 2014 MLB World Series - Game 2: Kansas City Royals 7, San Francisco Giants 2 [PHOTOS]
Join the Conversation
- The Pirate Bay Blockade: Cost Of Blocking Websites Like TPB Is Ridiculously High
- Virginia Woman Who Posted Naked Image Of Ex-BF’s New Partner 1st Person Charged Under Revenge Porn Law
- No Mercy: ISIS, Father Stones to Death Daughter for Alleged Adultery
- iOS 8 Jailbreak Release Date is Doomed as Team Evad3rs Opts Out, Pangu Hits Snag – Report
- Google Nexus 6 vs. iPhone 5S: 4 Important Things to Consider Before Switching to Android Lollipop
- Israel Loses A Friend in UN Security Council As New Zealand Replaces Australia
- Swedish Military Spots ‘Russian Submarine’ Off Stockholm Coast, An Alarming ‘Security Game Changer’