Feb. 25 (Bloomberg) — U.S. stocks erased losses, sending the Standard & Poor's 500 Index above its record close, after companies from Macy's Inc. to Home Depot Inc. reported higher- than-estimated earnings.
Home Depot and Macy's rose more than 2 percent. Tesla Motors Inc. climbed 15 percent as Morgan Stanley more than doubled its projected price for the stock. Office Depot Inc. slumped 12 percent after reporting an unexpected loss. Western Union Co. dropped 1.8 percent after disclosing it got subpoenas in November under an investigation into fraud-induced money transfers.
The S&P 500 added 0.2 percent to 1,851.33 at 11:22 a.m. in New York. Earlier, the U.S. equity benchmark fell 0.4 percent. The Dow Jones Industrial Average advanced 30.12 points, or 0.2 percent, to 16,237.26 today. Trading in S&P 500 stocks was 5 percent below the 30-day average during this time of the day.
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"The market has done extremely well in February," Douglas Cote, chief market strategist at ING U.S. Investment Management in New York, in a telephone interview. His firm oversees about $200 billion. "2014 is more of a recognition that we're in a global economic expansion and no longer a recovery."
The S&P 500 climbed to a record 1,858.71 yesterday before slipping back for a 0.6 percent gain and ending below its previous closing high on Jan. 15. The index slumped 5.8 percent from that date through Feb. 3. as investor concern about continued cuts to the Federal Reserve's monthly asset purchases fueled a rout in emerging markets.
Housing, Consumer
Home prices in the U.S. climbed at a slower pace in the year through December, indicating the market is entering a new stage that will help sustain further progress. The S&P/Case- Shiller index of property values in 20 cities rose 13.4 percent from December 2012 after increasing 13.7 percent in the year ended in November, the group said today in New York. It was the first deceleration since June.
A Conference Board report showed a measure of confidence among U.S. consumers fell to 78.1 in February from 79.4 the prior month. The median forecast in a Bloomberg survey of economists called for a reading of 80.
Investors have dismissed worse-than-forecast U.S. economic data over the past two weeks, speculating that severe winter weather explains the weakness in reports such as housing and hiring.
Fed Chair Janet Yellen said this month that the economy has strengthened enough to withstand stimulus cuts, adding that only a notable change to the outlook would prompt the central bank to slow the pace of tapering. Three rounds of stimulus have helped push the S&P 500 173 percent higher from a 12-year low in 2009.
The Chicago Board Options Exchange Volatility Index slipped 2 percent today to 13.94. The gauge of S&P 500 options known as the VIX is up 1.6 percent this year.
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