Stocks gain, pushing S&P 500 to five-year high

Published on NewsOK Modified: January 10, 2013 at 3:47 pm •  Published: January 10, 2013
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"The third-quarter earnings season top-line revenue growth pulled back," said Krosby. "That's of concern because, when all is said and done, markets are supposed to be a reflection of company earnings."

Supervalu Inc. rose 43 cents, or 14.1 percent, to $3.47 after announcing that it had reached a $3.3 billion deal to sell five of its biggest grocery chains — Albertsons, Acme, Jewel-Osco, Shaw's and Star Market — to an investor group led by the private equity firm Cerberus Capital Management.

The S&P 500 is already up 3.2 percent so far this year after lawmakers reached a last-minute compromise to stop the U.S. from going over the "fiscal cliff," a reference to sharp tax increases and across-the-board government spending cuts that could have pushed the economy back into recession.

Yet while the budget deal avoided many of the tax increases, it only put off the so-called sequestration, or spending cuts, that were part of the fiscal cliff threat.

Ben Schwarz, chief market strategist at Light Speed Financial, said stocks are unlikely to make substantial gains until lawmakers deal comprehensively with the government spending issue.

"Everybody gave each other high fives, running up and down in Washington because they did the fiscal cliff, but the big deal is about to come and smack them upside their head, all the real issues that they didn't want to deal with," Schwarz said. "Most people are now thinking, better to be safe than sorry."

The yield on the 10-year Treasury note rose 4 basis points to 1.90 percent. The yield on the note, which rises as bonds fall, has jumped 30 basis points in the past month.

Other stocks making big moves:

— Urban Outfitters rose $1.89, or 4.6 percent, to $42.64 after the company said that it had record sales for the two months ending in December.

— Jewelry retailer Tiffany & Co. sank $2.86, or 4.5 percent, to $60.40 after reporting that its sales increased at a slower pace than previously expected during the critical holiday shopping season. The company said its full-year earnings would come in at the low end of its prior forecast.

— Herbalife, a nutritional supplements maker, fell 71 cents, or 1.8 percent, to $39.24 after the company made a presentation to investors to counter claims made by hedge fund manager William Ackman that the business is a pyramid scheme.