S&P 500 rides Microsoft, Amazon to record close north of 4,000

REUTERS -The S&P 500 surged on Thursday to its first-ever close above the 4,000 mark, lifted by gains in Microsoft, Amazon and Alphabet, as well as optimism about a recovering U.S. economy.

Microsoft, Amazon, Alphabet and Nvidia jumped 1per cent or more, with those and other growth stocks showing signs of awakening after lagging in recent weeks behind so-called value stocks expected to outperform as the economy recovers from the coronavirus pandemic.

Data showed the number of Americans filing new claims for unemployment benefits rose unexpectedly last week. However, other data showed a measure of manufacturing activity soared to its strongest level in more than 37 years in March, with employment at factories the highest since February 2018.

Unofficially, the Dow Jones Industrial Average rose 0.53per cent to end at 33,155.85 points, while the S&P 500 gained 1.19per cent to 4,020.07. The Nasdaq Composite climbed 1.76per cent to 13,480.28.

With its latest record, the S&P 500 was up about 7per cent in 2021, and it has gained 80per cent from its low in March 2020.

"We’re still bullish for this year, and we think that with stimulus, with the Fed committed to being dovish, with the economy reopening due to more of the U.S. getting vaccinated, overall you're going see corporate earnings do pretty well," said King Lip, chief investment strategist at Baker Avenue Asset Management in San Francisco.

The Nasdaq remained about 5per cent below its Feb. 12 record high close, still smarting after higher U.S. bond yields hurt technology stocks.

Most S&P sectors rose, with technology, communication services and energy gaining more than 1per cent.

Micron Technology Inc jumped after the chipmaker forecast fiscal third-quarter revenue above Wall Street estimates due to higher demand for memory chips, thanks to 5G smartphones and artificial intelligence software.

U.S.-listed shares of rival Taiwan Semiconductor rose after it said it will invest US$100 billion over three years to meet rising chip demand.

U.S. stock markets will close on Good Friday for the holiday.

The CBOE volatility index slipped below 18 points for the first time in 14 months, a level last seen before the coronavirus-driven global financial market meltdown in March 2020.

Johnson & Johnson fell after the drugmaker said it had found a problem with a batch of the drug substance for its COVID-19 vaccine being produced by Emergent Biosolutions, whose shares tumbled.

(Additional reporting by Devik Jain and Medha singh in Bengaluru; Editing by Arun Koyyur and David Gregorio)