NEW YORK (AP) — Stocks are continuing their rapid recovery Friday as health care and technology companies lead the market toward its sixth gain in a row. Investors were fleeing the market early this month, but a combination of lower prices and rising company profits have them hurrying to buy stocks again.
KEEPING SCORE: The Standard & Poor’s 500 index gained 17 points, or 0.6 percent, at 2,748 as of 1 p.m. Eastern time. The Dow Jones industrial average rose 160 points, or 0.6 percent, to 25,360. The Nasdaq composite picked up 31 points, or 0.4 percent, to 7,288. The Russell 2000 index of smaller company stocks climbed 11 points, or 0.7 percent, to 1,548.
The S&P 500 plunged 10 percent in nine days at the start of February. It’s up 6.5 percent in the last six days. That includes a gain of almost 5 percent this week, which would be its best week since August 2011. At that time the market was also coming back from a big drop following the downgrade of the U.S. government’s credit rating and fears about outsize government debt in Europe.
HOME SWEET HOME: Construction of new homes jumped 9.7 percent in January, according to the Commerce Department. That was the highest level since October 2016, and permits, a sign of future construction, also climbed. For years homebuilders haven’t put up enough homes to meet demand, although that often helped their stocks because the shortage sent prices higher and higher. NVR gained $96.80, or 3.1 percent, to $3,173.80 and Hovnanian Enterprises added 11 cents, or 5.2 percent, to $2.23 while D.R. Horton rose 83 cents to $45.94.
Home improvement retailer Home Depot gained $2.14, or 1.2 percent, to $187.41.
ON TOP AGAIN: Technology and health care companies led stocks higher last year. In a typical market downturn, investors might avoid stocks that have had huge run-ups out of fear they had gotten too expensive. That hasn’t happened this time. Instead, investors are still betting on more strength in the economy and are buying companies that tend to do better in times of faster growth. Since the market hit its low point on Feb. 8, the S&P 500 technology index is up more than 9 percent and the health care index has risen 6 percent.
On Friday Apple climbed $1.33 to $174.32 and chipmaker Applied Materials rose $1.77, or 3.3 percent, to $55.76. Alphabet, Google’s parent company, added $14.80, or 1.4 percent, to $1,106.10. Among health care companies, Johnson & Johnson gained $2.71, or 2.1 percent, to $133.94 and Pfizer picked up 84 cents, or 2.4 percent, to $36.55. AbbVie jumped $3.22, or 2.8 percent, to $118.12.
Now that stocks have stopped plunging, investors are focusing on the strong results companies posted in the fourth quarter.
“Analysts continue to underestimate the pace of global growth,” wrote Credit Suisse analyst Jonathan Golub. “As a result, more companies are beating/hitting expectations than in any quarter in 20 years.”
DEERE ROLLING IN ’DOE’: Farm equipment maker Deere climbed $6.60, or 4 percent, to $173.41 after it raised its profit and sales forecasts for the year.
NOT SATISFIED: Kraft Heinz had a weak quarter as sales of cheeses and cold cuts declined. The maker of Oscar Mayer meats, Jell-O pudding and Velveeta cheese fell $2.63, or 3.6 percent, to $70.08. Campbell Soup said sales of fresh foods declined, while soup sales continued to fall because of a dispute with a customer about how to promote them. Analyst said that customer is Walmart. Campbell shares lost $1.70, or 3.6 percent, to $46.
Coca-Cola fared better as its sales surpassed analyst projections. The stock gained 61 cents, or 1.4 percent, to $45.39.
BAD FIT: VF Corp., the owner of brands such as Vans, North Face and Timberland, reported a solid quarter, but analysts said they expected better after several months of unusually cold winter weather. VF also said it will sell its Nautica apparel brand. With the stock up more than 50 percent over the last year, that wasn’t enough to keep the gains coming. The shares lost $8.34, or 9.9 percent, to $75.60.
BONDS: Bond prices rose. The yield on the 10-year Treasury note fell to 2.86 percent from 2.91 percent.
ENERGY: U.S. crude oil picked up 25 cents to $61.59 a barrel in New York. Brent crude, used to price international oils, added 44 cents to $64.77 a barrel in London.
CURRENCIES: The dollar edged up to 105.99 yen from 106.27 yen. The euro fell to $1.2457 from $1.2506.
OVERSEAS: The CAC 40 of France climbed 1.2 percent after a strong gain a day ago. Germany’s DAX added 0.8 percent while the FTSE 100 in Britain gained 0.9 percent. In Japan, the Nikkei 225 index climbed 1.2 percent. Markets in China and South Korea were closed for lunar new year celebrations.
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AP Markets Writer Marley Jay can be reached at http://twitter.com/MarleyJayAP . His work can be found at https://apnews.com/search/marley%20jayt .
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