Stocks rose Friday, extending the biggest first-quarter advance since 1998 for the S&P 500, as stronger-than-forecast growth in consumer sentiment and spending bolstered optimism in the economy.
The S&P 500 rose 5.19, or 0.37%, closing at 1,408.47; the Dow Jones industrial average closed up 66.22, or 0.5%, at 13,212.04; and the Nasdaq composite was down 3.79, or 0.12%, to close at 3,091.57. All numbers are preliminary.
Government data on Friday showed U.S. consumer spending increased 0.8% in February, the most in seven months. Separately, the Thomson Reuters/University of Michigan final index of consumer sentiment for March rose to 76.2. Economists projected a reading of 74.5.
The S&P 500 has risen 3.2% in March, rallying for a fourth straight month. The Dow has added 2% since the end of February, poised for a sixth month of gains. Both are headed for the longest stretches of monthly rallies since 2009.
More than $3.6 trillion was restored to U.S. equity values since the S&P 500 reached last year’s low in October amid better-than-estimated economic data. The index climbed 28% from Oct. 3 through Thursday. The rally sent the S&P 500 to about 14.5 times reported earnings, the highest valuation since July while below the average since 1954 of 16.4.
“The best of 2012 is probably behind us,” Alan Brown, chief investment officer at Schroders, said in a telephone interview from London. His firm oversees $291 billion. “We’ve had a very substantial rally. I’m not sure where the fresh round of good news comes from that we haven’t already discounted in today’s prices. I’m rather more cautious at the present time.”