Stock prices posted solid gains for the second session in a row Tuesday following positive economic reports.
The Dow Jones industrial average gained 88.97 points to 16,336.19. The Nasdaq composite index was up 53.36 points, or 1.25 percent, to 4,333.31, and the Standard & Poor’s 500 index rose 13.42 points to 1,872.25 as housing data bolstered confidence in the economy and Vladimir Putin said Russia isn’t seeking to split Ukraine.
A government report showed the cost of living rose by just 0.1 percent in February despite a big jump in food prices. Over the past 12 months, the consumer price index rose by just 1.4 percent. Another report showed a weather-related drop in new home construction activity in February but also saw a large increase in building permits, a sign of future activity.
Gold fell $13.90 to $1,359 an ounce while oil was up $1.62 to $99.70 a barrel.
Microsoft Corp. (Nasdaq: MSFT) rallied to the highest since 2000 as the company plans to debut a version of Office for Apple Inc.’s (Nasdaq: AAPL) iPad.
Hewlett-Packard Co. (NYSE: HPQ) added 3.7 percent after Barclays Plc lifted its rating on the computer maker.
Nasdaq OMX Group Inc. fell 3.1 percent as New York’s attorney general started an investigation into whether stock exchanges provide high-frequency traders with improper advantages.
GameStop Corp. (NYSE: GME) dropped 3.4 percent after Wal-Mart Stores Inc. (NYSE: WMT) said it will start selling pre-owned video games later this year.
Less than 5.9 billion shares changed hands on U.S. exchanges, 12 percent below the three-month average.
A Commerce Department report showed housing starts were little changed in February after declining less than previously estimated a month earlier, indicating the homebuilding industry is stabilizing after bad winter weather curbed construction.
Permits filed for future projects increased 7.7 percent to a 1.02 million pace in February, the most since October.
The Federal Open Market Committee will announce a $10 billion cut to monthly bond purchases Wednesday, according to the median of responses in a Bloomberg survey. The central bank will continue to slow the program at that pace at every meeting before ending it at the Oct. 28 and 29 gathering, the survey showed.
Fed Chairwoman Janet Yellen said last month that the U.S. economy was strong enough to withstand measured reductions to the central bank’s monthly bond purchases. Three rounds of Fed stimulus have helped push the S&P 500 up 177 percent from a 12-year low, as U.S. equities enter the sixth year of a bull market that started March 9, 2009.
Equity futures jumped this morning after Putin said Russia won’t attempt to further split up Ukraine. Crimea voted on Sunday to leave Ukraine and become part of Russia. The regional parliament called the plebiscite after Ukrainian President Viktor Yanukovych fled the country after protests against his rule.
“We don’t want to split up Ukraine, we don’t need that,” the Russian president said in a speech to parliament. “Don’t believe those who scare you with Russia, who yell that Crimea will be followed by other regions.”
U.S. and European leaders condemned Putin’s push to annex the region and promised further sanctions as early as this week. Ukraine’s government said the conflict has entered a military phase as clashes in Crimea intensified, killing at least one Ukrainian serviceman.
Investors have added $352.1 million to U.S. equity exchange-traded funds in the past five days and $463.4 million to bond ETFs, data compiled by Bloomberg show.
Microsoft jumped 3.9 percent to $39.55, the highest since July 2000. CEO Satya Nadella will begin unveiling his vision for the company when he debuts a version of Office for the iPad and offers some features of the application for free at an event next week, said people with knowledge of the announcement.
Hewlett-Packard added 3.7 percent to $30.56, closing at the highest level since August 2011. Barclays said HP’s servers may gain market share from International Business Machines Corp. (NYSE: IBM) and Lenovo Group Ltd. (OCTMKTS: LNVGY)
General Motors Co. (NYSE: GM) climbed 1.6 percent to $35.17. CEO Mary Barra promoted 40-year engineering executive Jeff Boyer to a new global vehicle safety position, as scrutiny intensifies on a flaw linked to 12 deaths.
An S&P index of homebuilders rose 1.5 percent, with all 11 members advancing. D.R. Horton Inc. (NYSE: DHI) added 1.8 percent to $22.45 and Lennar Corp. (NYSE: LEN) gained 1.4 percent to $40.60.
GameStop plunged 3.4 percent to $38.39. Wal-Mart announced that customers can trade in video games for credit that can be used on any kind of merchandise. The world’s largest retailer will also sell pre-owned video games later this year.
— Bloomberg contributed to this report.