Stocks rally lifts S&P 500 above 2,000 on economic strength

NEW YORK – U.S. stocks rose, sending the Standard & Poor’s 500 Index above 2,000, after a report showed the biggest-ever jump in durable-goods orders and an unexpected consumer confidence increase.

Amazon.com Inc. added 2.5 percent after the company said it’s buying video-game service Twitch Interactive Inc. in one of its biggest-ever acquisitions. Best Buy Co. dropped 6.5 percent after posting a same-store sales decline that was steeper than analysts had projected. Tim Hortons Inc. jumped 8.5 percent after Burger King Worldwide Inc. agreed to acquire the coffee-and-doughnuts chain in a $11.4 billion cash-and-share deal.

The S&P 500 rose 0.2 percent to 2,002.08 at 1:29 p.m. in New York. The index touched an intraday record of 2,005.04. The Dow Jones Industrial Average added 55.61 points, or 0.3 percent, to 17,132.48 Tuesday. The Nasdaq Composite Index increased 0.3 percent for a fourth day of gains. Trading in S&P 500 stocks was 29 percent below the 30-day average.

“There’s not a lot of direction in the market so far,” Richard Sichel, chief investment officer at Philadelphia Trust Co., which oversees $2 billion, said in a phone interview. “The 2,000 number got a lot of attention, but let’s get back to basics and see how the economy is doing.”

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Data Tuesday showed orders for U.S. durable goods jumped 23 percent in July as bookings surged for commercial aircraft. An air show in the United Kingdom helped drive a 318 percent jump in plane orders, the most since January 2011. A 0.5 percent drop in orders for non-military capital goods excluding aircraft last month followed a June increase of 5.4 percent.

Confidence grows

The Conference Board’s consumer confidence index rose to 92.4 in August, the highest level since October 2007, from a revised 90.3 a month earlier, the private research group said.

The S&P 500 has advanced for the past three weeks and more than $1 trillion has been added to the value of American equities since a two-month low on Aug. 7 amid speculation central banks will continue to keep interest rates near zero even as the economy strengthens.

“I am still bullish on the U.S. market, but I do expect the S&P 500 to consolidate and slip back to 1,950-80 range, as it’s due for a rest once it climbs to 2,000,” said Manish Singh, who helps manage $2 billion at Crossbreed Capital in London. “Any dip will be a shallow one. The central-bank and data narrative is still supportive of risk.”

Tim Hortons

Eight of the 10 main groups in the S&P 500 advanced today. Energy shares led gains with a 0.9 percent rally as West Texas Intermediate oil rose from a seven-month low. Exxon Mobil Corp. added 1.2 percent to lead the Dow higher.

The Nasdaq Biotech Index climbed 1.1 percent to the highest on record, rebounding from a 21 percent decline from February through April amid concern that earnings don’t justify their share prices.

U.S. shares of Canada’s Tim Hortons added 8.5 percent to $81.05, after rallying 19 percent yesterday. Burger King slid 3.8 percent to $31.16, reversing an earlier 2.5 percent gain. The hamburger chain Monday surged 20 percent yesterday after saying it is in talks with Tim Hortons. Burger King will move its headquarters to Canada, enabling the second-largest U.S. burger chain relocate to a lower-tax country.

Premier Inc. rose 5.1 percent to $31.91 after forecasting full-year adjusted earnings of $1.39 to $1.44 a share, exceeding the average analyst estimate of $1.38. The purchasing network owned by health care providers also agreed to buy software company Aperek Inc. for $48.5 million.

Amazon, DSW

Amazon.com added 2.5 percent to $342.25 after the company said said it’s paying $970 million in cash for Twitch, the online gathering place for gamers. The acquisition gives the Web retailer a forum of more than 55 million monthly active users, where people discuss games or watch others as they play.

DSW Inc., a shoe retailer, jumped 8.6 percent to $30.81 after reporting higher-than-estimated profit.

Best Buy lost 6.5 percent to $29.90 after the world’s largest electronics chain said second-quarter comparable sales fell 2.7 percent. That was steeper than the 2.2 percent drop forecast by analysts on average. Same-store sales will decline by a “low single-digit” percentage rate in the third and fourth quarter, the company said.

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