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The blue chips posted triple-digit gains in afternoon trading as strong data on the housing market and easing tensions about the eurozone political situation trumped ExxonMobil’s earnings miss.
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As of 2:45 p.m. ET, the Dow Jones Industrial Average climbed 122 points, or 0.94%, to 13213, the S&P 500 rose 9.6 points, or 0.69%, to 1400 and the Nasdaq Composite gained 23.5 points, or 0.77%, to 3052.
The Nasdaq posted its best performance of the year on Wednesday, rallying 2.3%, on the back of strong earnings from technology titan Apple.
Traders were paying close attention to two important economic reports on the day.
Pending home sales, which are a forward-looking indicator, jumped 4.1% in March from the month prior, according to the National Association of Realtors. The index is also up 12.8% from the same month in 2011.
New claims for unemployment benefits fell to 388,000 last week from an upwardly revised 389,000 the week prior, the Labor Department reported. Economists were expecting a drop to 375,000 from an initially reported 386,000. The four-week moving average, which helps smooth out volatility, rose to 381,750 -- the highest level seen since January 7.
The weekly read has been rising slowly recently, raising concerns over the strength of the jobs market. However, the report from the Labor Department can be volatile, and is often subject to substantial revisions.
Indeed, analysts at Nomura wrote in a note to clients that "the rise should not be taken as a sign that there is fundamental weakening in the labor market." In their view, the upward momentum is likely the result of "imperfect" seasonal adjustments.
On the European front, Dutch Finance Minister Jan Kees de Jager said that a budget proposal, which garnered support from the majority parliament, would reduce the country's budget deficit sufficiently to keep it in-line with a eurozone fiscal pact, according to a report by Reuters. There were worries among analysts that a disagreement over the budget might put the country in breach of the agreement and knock the currency bloc back to the drawing board on a key measures aimed to reducing sovereign debt across the board. At the time it was rolled out, many analysts saw it as a key factor in pushing the European Central Bank to take moves to support the bloc's financial sector and debt market.
Several major companies posted earnings on the day.
ExxonMobil (NYSE:XOM) revealed a first-quarter profit of $2.00 a share, weaker than the $2.09 analysts expected. The biggest U.S. oil company’s revenue came in at $124.05 billion, also shy of the $124.76 billion forecast.
United Parcel Service (NYSE:UPS) posted first-quarter earnings of $1.00 a share on sales of $13.1 billion, missing estimates of $1.02 a share on $13.26 billion. The world’s biggest package delivery company also reaffirmed its full-year profit outlook of $4.75 to $5 a share.
Commodities were broadly higher. Oil traded in New York rose 43 cents, or 0.41%, to $104.55 a barrel. Wholesale New York Harbor gained 0.87% to $3.18 a gallon.
In metals, gold jumped $16.50, or 1%, to $1,659 a troy ounce.
European blue chips slipped 0.01%, the English FTSE 100 gained 0.52% to 5749 and the German DAX rose 0.53% to 6740.
In Asia, the Japanese Nikkei 225 rose 0.01% to 9562 and the Chinese Hang Seng climbed 0.79% to 20810.