U.S. Stocks Extend Gain After Fed Cuts Lending Rate

U.S. stocks extended gains after the Federal Reserve cut its benchmark interest rate for the seventh time since September to spur economic growth.
TradingEconomics.com, Bloomberg 4/30/2008 11:48:18 AM

All 10 industry groups in the Standard & Poor's 500 Index climbed, capping its best monthly advance since 2003, as the central bank reduced the target for overnight lending by 0.25 percentage point and said the easings should help promote growth. General Motors Corp. rallied the most in three years as the largest automaker reported a narrower loss than analysts estimated. Procter & Gamble Co., the biggest consumer-products company, had its steepest advance since February 2007 as higher overseas sales boosted profit.

The S&P 500 added 11.02 points, or 0.8 percent, to 1,401.96 at 2:32 p.m. in New York. The Dow Jones Industrial Average climbed 148.91 to 12,980.85. The Nasdaq Composite Index increased 17.93 to 2,444.03. Almost two stocks rose for each that fell on the New York Stock Exchange.

Stocks rose earlier when better-than-forecast gross domestic product assuaged concern that the housing slump will drag the country into a recession.

The S&P 500 has climbed 6 percent this month as results from Google Inc., Intel Corp., Boeing Co. and American Express Co. eased concern profits will deteriorate. Earnings have topped estimates at 69 percent of the companies in the index that have posted first-quarter results so far, compared with 66 percent in the entire period last year, data compiled by Bloomberg show.

GM gained the most in the Dow average and S&P 500, rising $2.46, or 12 percent, to $23.66. The automaker said its first- quarter loss excluding some costs was 62 cents a share, narrower than the $1.52-a-share forecast by analysts. GM had an $812 million pretax loss in North America, its largest region, while boosting profits in each of its other three regions.

Procter & Gamble rose $2.24, or 3.4 percent, to $68.14. Third-quarter profit increased 7.9 percent. Consumers in China, India and Latin America bought more shampoo and makeup as their standards of living improved, offsetting a drop in U.S. demand. The company raised prices to help meet higher commodity costs.

U.S. Stocks Extend Gain After Fed Cuts Lending Rate