By Amy Caren Daniel
(Reuters) - U.S. stocks rose in a broad rally on Thursday, boosted by Apple and other FAANG shares as well as the Federal Reserve's confidence in the strength of the economy.
Ten of the 11 major S&P sectors were higher, with Wall Street getting the biggest boost from the technology index's 0.82 percent jump.
Leading gains in the technology sector and the three major indexes was Apple, which rose 2.5 percent after JPMorgan rated the stock "overweight", citing the iPhone maker's quicker-than-expected move to a services business.
The top gainer among sectors was the recently revamped communications services group, which rose 1.32 percent. It houses three of the five FAANG stocks – Netflix, Google-parent Alphabet and Facebook - all of which were higher.
The fifth member, Amazon.com, rose 1.9 percent after Stifel talked up the company's retail, advertising and cloud businesses and slapped a Street-high price target on the stock.
"FAANG's are strong today in part because they have pulled back recently which is presenting an attractive entry point," said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management in Minneapolis, Minnesota.
"Fundamentally, earnings are rising, inflation appears non-problematic and interest rates are still relatively low and that presents a favorable backdrop for equities to trend higher."
The Fed raised rates for the third time this year on Wednesday and kept its monetary policy outlook largely the same, noting the U.S. economy is having a "particularly bright moment."
Commerce Department data showed economic growth accelerated in the second quarter at its fastest pace in nearly four years, as previously estimated.
For the third quarter, however, growth estimates were tempered by a drop in new orders for key U.S.-made capital goods last month, though they still remained at lofty levels as other data showed rising investment in wholesale and retail inventories.
At 13:17 a.m. EDT the Dow Jones Industrial Average was up 138.01 points, or 0.52 percent, at 26,523.29, the S&P 500 was up 17.86 points, or 0.61 percent, at 2,923.83 and the Nasdaq Composite was up 75.82 points, or 0.95 percent, at 8,066.19.
The materials index fell 0.73 percent and was the only S&P sector in the red.
Among stocks, Accenture fell 1.5 percent after its full-year profit fell short of analysts' estimates.
A disappointing fourth-quarter forecast sent Carnival Corp tumbling 5.2 percent and also pulled fellow cruise operators Norwegian Cruise Line and Royal Caribbean lower.
Conagra dropped 6.7 percent after its quarterly revenue missed analysts' estimates. Other food companies also fell, with Kellogg, JM Smucker and Campbell Soup shedding about 2 percent.
Advancing issues outnumbered decliners by a 1.74-to-1 ratio on the NYSE and a 1.40-to-1 ratio on the Nasdaq.
The S&P index recorded 16 new 52-week highs and nine new lows, while the Nasdaq recorded 49 new highs and 48 new lows.
(Reporting by Amy Caren Daniel in Bengaluru; Editing by Anil D'Silva)
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Updated Date: Sep 28, 2018 00:05 AM