Dow Jones closes at highest level of year, nears record
NEW YORK -- The Dow rose to its highest close of the year Tuesday, ending 146 points from a record. Stocks gained after impressive results from two big consumer brands.
The Dow Jones industrial average closed up 47.46 to 14,018.70, putting it within 1 percent of the record close of 14,164.53 set in October 2007. The Standard & Poor's 500 gained 2.42 points to 1,519.43, also close to its record.
In a quiet day of trade, stocks were driven higher by beauty products maker Avon and luxury clothing and accessories company Michael Kors, whose results impressed investors. Consumer spending accounts for 70 percent of economic activity in the U.S.
Financial and home building stocks also lifted stocks, led by Bank of America and Masco Corp, which notched some of the day's biggest gains.
The Dow has surged at the start of the year, logging its best January in almost two decades, after lawmakers reached a last-minute deal to avoid the "fiscal cliff" of sweeping tax increases and spending cuts. Investors are also becoming more optimistic that the housing market is recovering and that hiring is picking up.
The 30-member Dow has now closed above 14,000 twice this month. Before February, the index had closed above that level just nine times in its history. The first time was in July 2007; the rest were in October of that year.
Avon's stock price jumped $3.51, or 20 percent, to $20.79 after the company posted a fourth-quarter loss that wasn't as bad as analysts expected. The company also hopes to save $400 million by slashing costs. Michael Kors rose $5, or 9 percent, to $62 after reporting earnings that beat analysts' predictions.
About 70 percent of companies in the S&P 500 have reported earnings for the fourth quarter. Analysts are projecting that earnings will rise 6.4 percent for the period, an improvement from the 2.4 percent growth reported in the third quarter, according to S&P Capital IQ.
The Dow has now advanced 7 percent this year, and the S&P 500 is up 6.6 percent.