Stocks rise on manufacturing boost

A better outlook for global manufacturing has pushed the US stock market to an all-time high.

FILE - This April 22, 2010, file photo, shows a Wall Street sign in front of the New York Stock Exchange. Global stock markets mostly inched higher Monday, June 30, 2014, as investors prepared for a busy week of economic news that will give new clues about the strength of the global recovery. Wall Street was set for a tepid session. (AP Photo/Mark Lennihan, File)
FILE - This April 22, 2010, file photo, shows a Wall Street sign in front of the New York Stock Exchange. Global stock markets mostly inched higher Monday, June 30, 2014, as investors prepared for a busy week of economic news that will give new clues about the strength of the global recovery. Wall Street was set for a tepid session. (AP Photo/Mark Lennihan, File)

The Dow Jones industrial average climbed within two points of 17,000 for the first time after separate surveys showed that manufacturing expanded in China and the US, the world's two biggest economies.

In China, manufacturing grew in June for the first time in six months and in the US the sector notched its 13th straight month of growth.

General Motors rose the most in almost a month. The car maker reported that its US sales increased 1% in June despite a record-setting string of safety recalls. Netflix jumped after analysts at Goldman Sachs raised their outlook on the stock, predicting the company would benefit from its international expansion.

"The economic news, by and large, isn't bad here," said Phil Orlando, chief equity strategist at Federated Investors. "Maybe investors are starting to think that this thing is going to grind higher."

The Standard & Poor's 500 index rose 13.09 points, or 0.7%, to 1,973.32. The Dow gained 129.47 points, or 0.8%, to 16,956.07. The index climbed as high as 16,998.70 in early afternoon trading before falling back slightly. Both indexes closed at all-time highs.

The Nasdaq composite rose 50.47, or 1.1%, to 4,458.65.

Stocks climbed from the open after HSBC said its Chinese purchasing managers index rose to 50.7 in June from 49.4 a month earlier. Numbers above 50 signal growth. The market added to its gains after another survey showed that US manufacturing kept growing.

The gains were broad. Nine of the 10 industry sectors that make up the S&P 500 rose. Utilities were the only sector to fall.

Health care stocks had the biggest advance with gains led by Regeneron. The company rose 19.53 dollars, or 7%, to 301.94 dollars after French drug maker Sanofi said in a regulatory filing that it had raised its stake in Regeneron.

The S&P 500 index has gained 6.8% this year, after jumping almost 30% in 2013. While stocks are no longer cheap, they are still a compelling investment compared with bonds or cash because interest rates are close to zero, said Joe Tanious, a global market strategist at JPMorgan Funds.

"In the long run market prices are dictated by the fundamentals," said Mr Tanious. "And the underlying fundamentals suggest that markets can move higher from here."

Government bonds prices fell. The yield on the 10-year Treasury note climbed to 2.56% from 2.53% late yesterday. Bond prices have risen this year, pushing interest rates lower, even as the Federal Reserve has reduced its economic stimulus and the economy has improved.