Wall St up as US economy gathers pace

Trader Thomas Ferrigno, left, works on the floor of the New York Stock Exchange. File photo / AP

Wall Street advanced in late afternoon trading as better-than-expected services sector data outweighed concern about the escalating crisis in Ukraine.

With about an hour of trading left in the day in New York, the Dow Jones Industrial Average rose 0.16 per cent, while the Standard & Poor's 500 Index gained 0.09 per cent, and the Nasdaq Composite Index added 0.15 per cent.

Gains in shares of Boeing and Visa, up 1.7 per cent and 1.3 per cent respectively, led the Dow higher. JPMorgan slumped 2.7 per cent after warning late on Friday that it expects bond and equity trading revenue to drop in the second quarter.

There was good news on the economic front, already lifted by a recent string of data showing that the world's largest economy is emerging stronger than anticipated from a harsh winter. The Institute for Supply Management said its services sector index climbed more than expected to 55.2 in April, up from 53.1 in March.

"It's more confirmation the economy is strengthening and we are headed for stronger growth," Peter Cardillo, chief market economist at Rockwell Global Capital in New York, told Reuters.

The services data comes on the heels of Friday's better-than-expected April jobs report. Trade data is due on Tuesday in Washington.

In corporate news, shares of Pfizer fell, last down 2.7 per cent, as revenue disappointed at a time the company is pursuing a takeover of the UK's AstraZeneca which, if successful, would rank as one of the biggest deals ever.

Shares of Target also dropped, last down 3.2 per cent, after the company said Gregg Steinhafel would step down, effective immediately, from his role as CEO. CFO John Mulligan has been appointed interim president and CEO until a replacement has been found. Target is trying to recover from a data breach scandal in 2013.

In Europe, the Stoxx 600 Index ended with a decline of 0.3 per cent from the previous close, as did Germany's DAX. France's CAC 40 eked out a 0.1 per cent gain. Trading in London was closed today for the May Day holiday.

The European Commission tweaked its growth outlook for the euro region, saying it now is forecasting economic expansion at 1.7 per cent in 2015, compared with an earlier 1.8 per cent forecast. Inflation will remain stubborn at 0.8 per cent in 2014 and 1.2 per cent in 2015, below the European Central Bank's target of 2 per cent.

The intensifying conflict in eastern Ukraine weighed on equity markets on both sides of the Atlantic, while adding to the appeal of bullion. Gold futures for June delivery gained 0.5 per cent to settle at US$1,309.30 in New York.

"The rising tension in Ukraine is adding to investors' reduced risk appetite," Kai Fachinger, a money manager at RobecoSAM in Zurich, told Bloomberg News.