Trader Gregory Rowe, left, works on the floor of the New York Stock Exchange. File photo / AP
Trader Gregory Rowe, left, works on the floor of the New York Stock Exchange. File photo / AP
Equities advanced overnight, pushing the Standard & Poor's 500 Index to a record high, as the latest manufacturing data showed that the US economic recovery remained on track.
The Institute for Supply Management's index increased to 53.7 in March from 53.2 a month earlier, a sign that the effects ofthe harsher-than-usual American winter are beginning to wear off. Of the 18 manufacturing industries, 14 reported growth in March, according to the report.
"There's a whiff of spring in the economic data, which means we're starting the second quarter with signs that the economy is maintaining the kind of reasonable growth that will continue to support the market," Jim McDonald, chief investment strategist at Chicago-based Northern Trust Global Investments, told Reuters.
Separately, Markit's US manufacturing PMI fell to 55.5 in March, down from 57.1 in February.
"The fall in the composite Manufacturing PMI masks the ongoing resilience of output, new orders and employment growth, all of which continued to rise at historically strong rates in March," Chris Williamson, chief economist at Markit, said in a statement. "That's because the PMI also includes a measure of supplier delivery times, which dragged the PMI down but only because deliveries were quicker as a result of improved weather."
"The survey indicates that factory output growth has picked up again after the weather-related disruptions seen at the start of the year, presenting policymakers with an encouraging picture of a healthy goods-producing sector that is generating jobs at the rate of 15-20,000 per month," Williamson said.
In afternoon trading in New York, the Dow Jones Industrial Average rose 0.29 per cent, the Standard & Poor's 500 Index gained 0.33 per cent, while the Nasdaq Composite Index climbed 0.99 per cent. Earlier in the session, the S&P 500 rose as high as a record 1,884.60.
Gains shares of Cisco and Boeing, last up 2.1 per cent and 1.6 per cent respectively, propelled the Dow higher.
In Europe, the Stoxx 600 Index ended the day with a 0.6 per cent advance from the previous close. Germany's DAX increased 0.5 per cent, while both the UK's FTSE 100 and France's CAC 40 added 0.8 per cent.
Markit's euro-zone manufacturing PMI slipped to 53.0 in March from 53.2 February, unchanged from the initial estimate.
"Despite having cooled slightly in March, the euro area manufacturing sector continues to enjoy its best spell of growth since early-2011," Williamson said in a statement. "The goods-producing sector is on course to provide a meaningful boost to the overall economy in the first three months of the year."
Separate data showed the unemployment rate in the euro zone held at 11.9 per cent in February, unchanged after a revision for the previous month.
China's PMI as measured by HSBC and Markit Economics slid to 48 in March, the lowest reading since July, from 48.5 in February. A separate PMI edged higher to 50.3, up from 50.2 the previous month, according to Chinese government data.
The reports underpinned expectations the government might increase its stimulus efforts to help boost the pace of growth in the world's second-largest economy.
