U.S. stocks jumped Friday, sending benchmark indexes to records, as an unexpected boost in stimulus from the Bank of Japan spurred optimism in the global economy.
Energy companies led gains, with Exxon Mobil Corp. and Chevron Corp. each rising 2.4 percent. LinkedIn Corp. soared 13 percent after third-quarter sales exceeded estimates. GoPro Inc. jumped 13 percent after its prediction for fourth-quarter profit surpassed analysts’ projections. Starbucks Corp. fell 2.3 percent after posting disappointing quarterly revenue.
The Standard & Poor’s 500 Index advanced 1.2 percent to 2,018.05, topping its previous all-time closing high of 2,011.36 on Sept. 18. The Dow Jones Industrial Average rallied 195.1 points, or 1.1 percent, to 17,390.52, also an all-time high. The Nasdaq Composite Index surged 1.4 percent to the highest since March 2000.
“The BOJ move is the icing on the cake,” said Patrick Moonen, who helps oversee $241 billion as a senior strategist at ING Investment Management. “Fundamentals are still good. Corporate earnings are better than expected, U.S. macro data came in strong and even the data in the euro zone show signs of stabilization.”
U.S. equities joined a global rally as Japan’s Government Pension Investment Fund said it will put half its holdings in local and foreign stocks, double previous levels, and invest in alternative assets. The Bank of Japan raised its annual target for monetary expansion to 80 trillion yen ($724 billion) from as much as 70 trillion yen.
Better-than-forecast corporate earnings and optimism in the economy helped the S&P 500 rebound after a 7.4 percent dip from Sept. 18 to Oct. 15. The gauge advanced 2.3 percent in October, extending its gain this year to 9.2 percent.
The Russell 2000 Index rallied 6.5 percent in October for its best month since July 2013. The Dow gained 2 percent in the month and the Nasdaq Composite Index jumped 3.1 percent.
“When we have some positive headlines out there, the market only focuses on that aspect,” Jonathan Corpina, senior managing partner at Meridian Equity Partners who works on the floor of the New York Stock Exchange, said by phone. “Since we’ve bounced off those lows 7, 8, 9 percentage points ago, the market seems to be determined to hit new highs.”