Wall Street boosted by return to banks, tech 14 May 2009

NEW YORK: Stocks rose on May 14 as investors returned to financial and technology shares on bets the recent rally could have more room to grow after a brief pullback, according to Reuters.
Volume, however, was light, a possible indication of a lack of broad conviction. Technology gains were led by big-cap tech and semiconductor companies after five straight days of losses for the PHLX Semiconductor index. Apple Inc was among the top boosts on Nasdaq, rising 2.9 percent to US$122.95, while the PHLX index climbed 3.2 percent.
The surge in U.S. markets over the past two months has made investors who missed the rally anxious to get back into stocks, analysts said.
"We've had a bit of a correction over the last couple days and people may be going in there and adding a bit, which makes the gains sustainable," said Kurt Brunner, portfolio manager at Swarthmore Group in Philadelphia, Pennsylvania.
Defensive stocks such as consumer staples and healthcare also gave a lift, underscoring some of the lingering worry about the economy following a report that showed a jump in weekly jobless claims.
Coca-Cola Co was among the Dow's biggest lifts, up 2.9 percent at US$44.90, and Merck & Co Inc added 1.5 percent to US$26.05.
The Dow Jones industrial average added 46.43 points, or 0.56 percent, to 8,331.32. The Standard & Poor's 500 Index gained 9.15 points, or 1.04 percent, to 893.07. The Nasdaq Composite Index climbed 25.02 points, or 1.50 percent, to 1,689.21.
The gains in financials and technology were striking, coming shortly after some analysts said the very same sectors would likely lead the market lower, having underpinned its run-up since March.
Shares of semiconductor companies got a lift after Bank of America-Merrill Lynch raised its rating and price target on shares of Novellus Systems citing cost cutting and attractive valuations. Novellus, which provides equipment to the semiconductor industry, rose 7.1 percent to US$16.88.
Financial shares gained, including JPMorgan & Chase & Co, up 4.4 percent to US$35.54, and Bank of America Corp, up 2.7 percent to US$11.31. Bank stocks have been a large part of the recent rally as investors bet that the sector had seen the worst of the credit crisis.
The S&P 500 is up 32 percent from the bear market low on March 9, but is down nearly 4 percent for the week as investors reassessed the economic outlook.
Data showed the number of U.S. workers filing new claims for jobless benefits rose more than expected in the latest week, pushed up by plant shutdowns related to Chrysler's bankruptcy.
The report came on the heels of Wednesday's figures showing consumers were still reluctant to spend and reviving worries over the length of the recession after optimism that the downturn was showing signs of abating.
United Technologies Corp was among the Dow's top boosts, up 1.8 percent at US$51.51. The world's largest maker of elevators and air conditioners said order rates had stabilized and it was starting to see early signs of recovery in China. - Reuters