U.S. stocks rose for a fifth straight day on Wednesday and the S&P 500 topped 1,200 as stronger-than-expected corporate results and March retail sales bolstered the outlook for profits.
Financial and technology sectors led gains on the broad S&P 500, which broke above 1,200 for the first time since September 2008, the same month when Lehman Brothers collapsed. The Nasdaq composite index advanced more than 1 percent.
Equity prices (were) given a lift from a positive start to the earnings season, said Michael Sheldon, chief market strategist, RDM Financial in Westport, Connecticut.
Data showing retail sales rose more than expected in March buoyed hopes about consumer spending.
The Dow Jones industrial average <.DJI> was up 64.84 points, or 0.59 percent, at 11,084.26. The Standard & Poor's 500 Index <.SPX> was up 9.26 points, or 0.77 percent, at 1,206.56. The Nasdaq Composite Index <.IXIC> was up 29.64 points, or 1.20 percent, at 2,495.63.
The 1,200 level was a technical resistance for the S&P and follows the Dow's finish above 11,000 on Monday. The breach may bring more gains or consolidation for the S&P 500, which is now up 77 percent since hitting its March 2009 low.
Given the substantial rally we've had off the February lows, it wouldn't be surprising to see a brief pullback at any time, Sheldon said.
The day's upbeat earnings news follows a revenue disappointment from Dow component Alcoa
Also this week, earnings are due from Google
Sales at U.S. retailers in March rose 1.6 percent, the Commerce Department reported, beating economists' expectations for a 1.2 percent increase. A separate report showed consumer prices rose 0.1 percent, matching expectations.
The Federal Reserve's Beige Book, an anecdotal description of economic activity, is due at 2 p.m.
If the S&P 500 holds above 1,200, it could next find strong resistance at around 1,228, a 61.8 percent Fibonacci retracement of the October 2007 to March 2009 decline, according to Reuters data.
The Fibonacci number is a widely used technical tool that can help identify the point at which asset prices will reverse.
A note from analysts at Jefferies Equity Derivatives said the gap between implied volatility and realized volatility suggests investors are bracing for a more volatile market. The Volatility index <.VIX>, down 2.1 percent, is at its lowest since July 2007.
(Editing by Kenneth Barry)