(Photo: AP)
US stocks moved higher in afternoon trading Tuesday as the market extended a winning streak well into a second week.
Consumer product makers, health care and technology companies notched some of the biggest gains.
Several chipmakers rose sharply. Advanced Micro Devices jumped 6.8 percent, and Nvidia climbed 4.4 percent. L Brands added 2.4 percent, Amazon rose 2 percent and Cigna gained 3.6 percent.
Utility and real estate companies lagged the market, a sign that investors are confident and feel the market has more room to grow. Traders tend to favor high-dividend, slow-growth stocks like those when they’re fearful of market turbulence.
The broader market broke out of a short slump last week and has been gaining since then. It marks a turnaround from a terrifying drop in December, and now every major US index is up more than 11 percent for the year.
A major focal point of the week for investors is the outcome of the Federal Reserve’s meeting on Wednesday. The central bank has signaled that it will be “patient” in raising interest rates.
KEEPING SCORE: The Dow Jones Industrial Average rose 99 points, or 0.4 percent, to 26,013 as of 1:28 p.m. Eastern Time. The S&P 500 index gained 0.4 percent and the Nasdaq composite climbed 0.5 percent.
Major indexes in Europe headed higher.
ANALYST’S TAKE: Investors seem reassured that the Fed will continue to hold off on raising rates, giving them more confidence push the market higher.
“Typically, markets tend to be flat in front of the Fed, usually we’re in a wait-and-see mode,” said Kate Warne, investment strategist at Edward Jones.
She said signs of a modest economic slowdown, such as a weak factory orders report on Tuesday, may help keep the Fed patient and on hold for a longer amount of time.
“It’s a slightly bad-news-is-good-news situation,” she said.
There has also been an absence of sharp bad news surprises, she said, which is giving investors confidence that there is less volatility than previously feared.
CRAFTY MOVEMENT: Michaels jumped 13 percent as investors rewarded a better-than-expected fourth quarter and overlooked a weak forecast. The arts and crafts retailer has been reassessing its operations, moving to expand its children’s offerings and shuttering its Pat Catan craft stores.
The company also changed leadership earlier this month, with CEO Chuck Rubin stepping down and longtime retail executive Mark Cosby taking over as interim CEO.
BROKEN LACE: DSW fell 13.4 percent after the footwear retailer surprised investors with a loss during the fourth quarter. The company swung to a loss of 7 cents per share, while Wall Street anticipated 4 cents per share in profit. Expenses jumped during the quarter and DSW had to deal with a hefty charge.
ROUGH ROAD AHEAD: Covenant Transportation Group slid 8.4 percent after the company warned investors that it could post weak first-quarter earnings because of softer demand.