NEW YORK -- More encouraging economic news and friendly signals from the Federal Reserve cheered investors Thursday, as the stock market climbed to another record high.
The gains came a day after the Fed made clear that it's in no hurry to raise a key bank lending rate, easing a major concern for the stock market.
The S&P 500 and Dow Jones industrial average closed at all-time highs. The S&P 500 index gained 9.79 points, or 0.5 percent, to 2,011.36. The Dow surged 109.14 points, or 0.6 percent, to 17,265.99. The Nasdaq composite climbed 31.24 points, or 0.7 percent, to 4,593.43.
The S&P Financials sector rose 1.1 percent. Bank profits could rise if short-term rates stay low while the rates they charge on longer-term loans creep higher.
"The question isn't 'Why are we up today?'" said Dan Veru, chief investment officer at Palisade Capital Partners in New York. "It's 'Why aren't we up a lot more?' What you're seeing is the U.S. economy growing at a modest pace, not too hot and not too cold."
Veru said it's an environment that allows the Fed to stick to a policy that coaxes businesses to borrow and spend and could fuel further gains for stocks.
The day began with good news about the economy. Fewer Americans filed first-time claims for unemployment benefits last week, according to the Labor Department. Weekly applications fell to 280,000, well below economists' forecasts. The four-week average, a less-volatile measure, also dropped.
Major markets in Europe headed higher as voters in Scotland decided whether to break from the United Kingdom. Germany's DAX advanced 1.4 percent, and France's CAC 40 gained 0.8 percent. Britain's FTSE 100 added 0.6 percent.
Scotland opened polling stations Thursday for a referendum on whether the country should leave the United Kingdom of Great Britain and Northern Ireland to become an independent state.
On Wednesday in the U.S., the Fed maintained its stance of keeping short-term interest rates near zero for a "considerable time." Investors had speculated that the Fed might hint at an earlier start for rate increases.
Among companies making big moves Thursday, Rite Aid fell 19 percent after it cut its profit forecasts for the full year, laying part of the blame on higher costs for generic drugs. The drugstore chain still expects sales of $26 billion this year. Rite Aid's stock fell $1.23 to $5.41.
ConAgra said its quarterly profits nearly tripled, sending its stock up $1.47, or 5 percent, to $33.48. Sales for the company behind Chef Boyardee canned pasta and Hebrew National hot dogs were flat, but other costs fell.
Alibaba Group was expected to wrap up its mammoth initial public offering Thursday, then make its debut on the New York Stock Exchange today under the symbol "BABA." The Chinese e-commerce company could raise as much as $24 billion in an initial public offering, making it the largest IPO on record in the U.S.
The price of oil fell on expectations of a quick return of Libyan production and continuing signals of lower global demand. Benchmark U.S. crude fell $1.35 to close at $93.07 a barrel in New York. Brent crude, a benchmark for international oils used by many U.S. refineries, fell $1.27 to close at $97.70 in London.
Business on 09/19/2014