Stocks extend gains, S&P holding above record close

US stock indices have pushed higher heading into the final hour of trading on Wall Street, as Janet Yellen adds her voice to the chorus citing poor weather as a possible excuse for soft data.

Janet Yellen delivered her delayed testimony in front of the US Senate Banking Committee today. While her prepared text was a repeat of remarks made previously in front of the equivalent House committee, she notably included the observation that weaker economic data than expected seen recently could be caused by unfavourable weather conditions.

While not particularly upbeat, today’s economic data has not been all that bad either. First-time claimants of jobless benefits grew to 348,000 last week, a rise of 14,000. It’s the latest sign of softness in the labour market, but the four-week moving average stays unchanged at 338,250.

The value orders of durable goods (items expected to last three years or more) dropped 1.0% in January. Orders for durable goods can be very changeable month to month because of the expensive nature of these items; for this reason, it can help to look at the data excluding transportation, which is one of the more volatile components. Without transportation, new orders were up 1.1%, suggesting reasonable demand. The more comprehensive factory orders reports (which adds in orders for non-durable goods) is released next Thursday.

With under an hour to the closing bell, the S&P 500 was up 0.43% at 1853.1, on course for a new closing record.

Tomorrow we have a revised estimate for fourth-quarter US GDP and, more importantly, the final reading for February’s index of consumer sentiment from the University of Michigan. Though GDP is the most comprehensive measure of the economy’s progress, we have already had a first estimate for Q4 so, barring a big revision the impact on the market is likely to be muted. Also, GDP is one of the less timely indicators. I will be focussing more on how consumers are feeling this month as a guide to how the economy is faring right now, rather than what was going on last year.

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