U.S. Stocks Gain Before Manufacturing Data

By Rita Nazareth - Feb 1, 2012 9:31 PM GMT+0700

U.S. stocks rose, snapping a four-day decline for the Standard & Poor’s 500 Index, as a report may show that American manufacturing joined a global pick up after factory indexes from China to Germany and the U.K. expanded.

The S&P 500 added 0.6 percent to 1,320.49 at 9:31 a.m. New York time. The index lost 1 percent over the past four sessions.

“The news on the economy is better,” David Sowerby, a Bloomfield Hills, Michigan-based portfolio manager at Loomis Sayles & Co., which oversees $150 billion, said in a telephone interview. “The uncertainty in Europe has diminished. While corporate profits have been less robust, they are still growing. That’s what’s moving stock prices higher.”

The S&P 500 rose 4.4 percent for the best January since it gained 6.1 percent in 1997, according to data compiled by Bloomberg. Earnings (SPX) beat projections at 66 percent of the 207 companies in the S&P 500 that reported quarterly results since Jan. 9, according to data compiled by Bloomberg. Profits probably grew 4.6 percent in the fourth quarter, according to a Bloomberg survey of analysts. The projection has fallen from 6.2 percent at the end of last year.

Equity futures joined a global rally after Chinese manufacturing indexes rose and a U.K. manufacturing gauge jumped to an eight-month high. The Institute for Supply Management’s factory index rose to 54.5, the highest since June, from 53.1 in December, according to the median estimate of 81 economists surveyed by Bloomberg News. A spokesman said Greece expects to complete talks on a private sector debt swap and a second international financing deal for the country in the next days.

To contact the reporter on this story: Rita Nazareth in New York at rnazareth@bloomberg.net

To contact the editor responsible for this story: Nick Baker at nbaker7@bloomberg.net