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 Stocks climbed to all-time highs for the third straight day as
investors assessed the prospect for further economic stimulus from the Federal
Reserve. Agilent Technologies, which makes scientific instruments, was the biggest gainer
in the Standard & Poor's 500 index after reporting earnings that exceeded
analysts' expectations. Exxon Mobil rose after billionaire Warren Buffett's
company disclosed late Thursday that it had taken a stake in the oil company. The S&P 500 has advanced for six straight weeks, part of an impressive rise this
year. The index is up 26.1 percent so far. If it ends 2013 with a gain that big,
it would be the best performance in a decade. Several factors have been driving the market higher this year. The Federal
Reserve has kept up its extraordinary efforts to stimulate the economy. And
while the U.S. economy's recovery has been plodding, it has been strong enough
to enable corporations to keep increasing their profits.
 "It's bland, it's vanilla, but it's sweet," said John Manley, chief equity
strategist at Wells Fargo Fund Management. Despite the surge, stock prices remain reasonable compared with earnings, Manley
said. Stock valuations are "not cheap, but they're not prohibitive," he said. The ratio of stock prices to forecast earnings for S&P 500 companies is
currently 15, according to data from FactSet. That's slightly below the average
ratio of 16.2 over the last 15 years and far below the peak of 25 recorded in
the late 1990s and early 2000s. The S&P 500 added 7.56 points, or 0.4 percent, to 1,798.18. All 10 of the
industry groups in the S&P 500 rose. The Dow Jones industrial average gained 85.48 points, or 0.5 percent, to
15,961.70. The Nasdaq composite rose 13.23 points, or 0.3 percent, to 3,985.97. Agilent jumped $4.39, or 8.7 percent, to $54.93. Exxon Mobil, a member of the
Dow, rose $2.05, or 2.2 percent, to $95.27.
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Investors may be getting more comfortable with the prospect of the Fed cutting
back on its stimulus as long as the economy is also improving, said Jim Dunigan,
a managing executive at PNC Wealth Management. The stock market's biggest
setbacks this year have come when investors worried that Fed policy makers were
close to paring their $85 billion per month in bond purchases, which are
intended to keep interest rates low.
"The path of least resistance (for stocks) seems to be higher right
now," Dunigan said. In government bond trading, the yield on the 10-year note rose to
2.71 percent from 2.70 percent from Thursday. Oil was flat at $93.71
a barrel. Gold rose $1.10 to $1,287.40 an ounce. Among
other stocks making big moves:
[Associated
Press; STEVE ROTHWELL, AP Markets Writer]
Contact Steve Rothwell
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