Stocks in Review

Sunday, May 3, 2009

U.S. stocks rose last week, completing the biggest monthly advance in nine years as first-quarter earnings beat analysts' estimates at two-thirds of the companies in the Standard & Poor's 500-stock index that released results.

Expedia, Newell Rubbermaid and Manitowoc shares jumped at least 23 percent as each reported earnings that exceeded forecasts. General Motors and Ford gained after Chrysler filed for bankruptcy protection.

The S&P 500 rose 1.3 percent, to 877.52, the highest level since Jan. 9. It gained 9.4 percent in April, its best month since March 2000. The Dow Jones industrial average climbed 136.12, or 1.7 percent, to 8212.41. The Nasdaq composite index rose 1.5 percent, to 1719.20, the highest since Nov. 4 and its eighth straight weekly gain.

"The amount of cost-cutting companies have been able to do allowed earnings to exceed expectations," said Kevin Shacknofsky, a money manager at Alpine Mutual Funds of Purchase, N.Y. "That's helped the market."

Of the 161 companies in the S&P 500 that reported earnings last week, 112 had results that were better than the average estimates of analysts in a Bloomberg survey. Stocks also rose after better-than-expected reports on consumer confidence and manufacturing signaled that the economy is improving.

Yields on Treasury securities climbed before next week's sale of $71 billion of notes and bonds to finance the widening federal budget deficit. The 10-year note's yield increased to 3.15 percent, the highest since Nov. 24, from 2.99 percent.

The Treasury will auction $30 billion of three-month bills and $28 billion of six-month bills on Monday. They yielded 0.15 percent and 0.29 percent, respectively, in when-issued trading. One-month and one-year bills will be sold Tuesday.

-- Bloomberg News

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