US close: Stocks start month in the blue despite poor data
Wall Street ended higher despite another spate of weaker than expected economic data, with personal spending and income figures missing expectations and manufacturing activity growing at its slowest rate in a year.
By the end of trading in New York, the Dow Jones Industrial Average had gained 0.86% to 18,289 and the Nasdaq Composite another 0.30% to 5,008, while the S&P 500 rose 0.59% to 2,117.
Indices were extending gains after a solid showing in February, with the S&P 500 in particular rising 5.5% during the month - its best performance since October 2011.
For its part, on Monday the Nasdaq Composite clambered back above the 5,000 point mark for the first time in 15 years.
Personal spending in the US dropped 0.2% in January, better than the 0.3% decline registered in December but lower than the 0.1% dip expected by economists.
The decline came as personal income rose 0.3% in January, matching December but a slightly lower result than the 0.4% increase estimated by economists.
The Institute for Supply Management's (ISM) US manufacturing index declined to 52.9 in February, from 53.5 the month before, slightly below the 53.0 consensus forecast. This was the survey's lowest rate of growth - identified by figures over 50 - since January 2014.
Economist Paul Ashworth from Capital Economics said that while there is "no reason to panic", the ISM data was "muted".
"The unseasonably severe weather got even worse in February, so there is little prospect of a rebound until March (and given how March just started, possibly not until April)," he said.
Weak economic data already baked in?
As far as equity markets are concerned, investors can draw some degree of comfort form the fact that UBS's economic surprise index is at it lowest in over a year. Nevertheless, the analysts consensus is for earnings at S&P 500 companies to drop by 4.9% in the first three months of the year, after rising by 4.6% in the fourth quarter of 2014, according to data compiled by Bloomberg.
Wireless solutions group Aruba Networks declined after strong gains last week as it confirmed that it will be taken over by Hewlett-Packard in a $3bn deal.
NXP Semiconductors jumped after saying it would merge with Freescale Semiconductor in a $11.8bn deal.
From a sector stand-point the largest gainers were seen in: consumer electronics (3.54%), precious metals (2.75%) and recreational services (2.6%).
Shares of Apple advanced on the back of positive comments out of analysts at Morgan Stanley, while shares in Google got a boost out of Bank of America, which upgraded its view on the stock to 'buy'.
Front month West Texas crude futures ended the session 0.69% higher at $49.93 per barrel in NYMEX trading.
The yield on 10-year US Treasuries edged lower by one basis point to 2.07%.
S&P 500 - Risers
GameStop Corp. (GME) $38.67 +4.60%
CBS Corp. (CBS) $61.75 +4.48%
Avon Products Inc. (AVP) $8.86 +4.11%
Harman International Industries Inc. (HAR) $142.39 +3.19%
Starwood Hotels & Resorts Worldwide Inc. (HOT) $82.86 +3.15%
Wyndham Worldwide Corp. (WYN) $94.11 +2.87%
Linear Technology Corp. (LLTC) $49.55 +2.83%
Charles Schwab Corp. (SCHW) $30.17 +2.83%
Carnival Corp. (CCL) $45.19 +2.73%
Tiffany & Co. (TIF) $90.60 +2.70%
S&P 500 - Fallers
Genworth Financial Inc. (GNW) $7.33 -5.42%
Peabody Energy Corp. (BTU) $7.49 -5.19%
Rowan Companies plc (RDC) $20.52 -5.04%
Valero Energy Corp. (VLO) $58.67 -4.90%
Noble Corporation plc (NE) $15.94 -4.21%
Murphy Oil Corp. (MUR) $49.11 -3.50%
Exelon Corp. (EXC) $32.83 -3.21%
Marathon Petroleum Corporation (MPC) $101.78 -3.07%
Eversource Energy (ES) $50.25 -2.88%
Ensco Plc. (ESV) $23.77 -2.86%
Dow Jones I.A - Risers
Visa Inc. (V) $278.29 +2.57%
Intel Corp. (INTC) $34.06 +2.44%
Cisco Systems Inc. (CSCO) $30.19 +2.30%
Boeing Co. (BA) $153.80 +1.96%
Walt Disney Co. (DIS) $105.89 +1.74%
Nike Inc. (NKE) $98.75 +1.68%
Pfizer Inc. (PFE) $34.77 +1.31%
Home Depot Inc. (HD) $116.12 +1.19%
McDonald's Corp. (MCD) $100.00 +1.11%
3M Co. (MMM) $170.50 +1.10%
Dow Jones I.A - Fallers
International Business Machines Corp. (IBM) $160.48 -0.90%
Chevron Corp. (CVX) $105.90 -0.73%
Exxon Mobil Corp. (XOM) $88.04 -0.56%
Coca-Cola Co. (KO) $43.20 -0.23%