(By Balachander) U.S. stocks closed higher as better-than-expected readings on manufacturing and consumer confidence offset worries about the federal spending cuts taking effect today.
The S&P 500 Index rose 0.23 percent to end at 1,518.22. The Dow Jones gained 0.25 percent to finish at 14,090.04. The Nasdaq Composite Index advanced 0.30 percent to close at 3,169.74.
On the domestic data front, the Institute for Supply Management's manufacturing PMI rose to 54.2 in February, the highest reading since June 2011, from 53.1 in January. Expectations were for a reading of 52.5. A reading above 50 indicates expansion.
The University of Michigan's final estimate of a consumer sentiment survey came in at 77.6 - a 3-month high - from a reading of 73.8 in January.
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January personal spending rose 0.2 percent, while income dropped 3.6 percent, a data from the Bureau of Economic Analysis showed. Economists expected income to drop 2.2 percent and spending to inch 0.2 percent higher.
Washington lawmakers' were unable to reach an agreement to avoid the sweeping set of spending cuts - known as sequestration - set to go into effect beginning Friday.
Hot Stocks Of The Day: AAPL, BBY, CRM, GRPN, GPS, IEP, PANW, DECK, MDR, MENT
Apple Inc. (NASDAQ: AAPL) fell 2.47 percent and reached a 52-week low of $431.88. Activist investor David Einhorn dropped his lawsuit against the iPhone maker over issuance of preferred shares. Credit Suisse reportedly reduced its iPhone shipments forecast by 11 percent for 2013.
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Best Buy Co. Inc. (NYSE: BBY) added 4.57 percent after the consumer-electronics giant posted better-than-expected quarterly results. The company is said to have talks with founder Richard Schulze who had proposed acquiring the company.
salesforce.com Inc. (NYSE: CRM) jumped 7.55 percent after the provider of enterprise cloud computing services raised full-year forecast following better-than-expected quarterly results.
Gap Inc. (NYSE: GPS) added 2.89 percent after the company posted a 61 percent jump in quarterly earnings on strong sales across its segments and the specialty apparel retailer approved plan to raise dividend.
Groupon Inc. (NASDAQ: GRPN) surged 12.58 percent after the daily deal website said it is replacing Andrew Mason as its Chief Executive. The leadership change comes a day after Groupon posted a quarterly loss and gave a downbeat revenue forecast.
Icahn Enterprises L.P. (NASDAQ: IEP) plunged 16 percent after the investment vehicle of activist investor Carl Icahn priced an offering of roughly 3.18 million shares of depositary units at $63.00 each, a discount of 12 percent to the stock's previous closing price.
Foster Wheeler AG (NASDAQ: FWLT) lost 16.00 percent after the Swiss engineering and construction contractor posted a 84 percent drop in quarterly earnings due to impairment charge on a non-core asset and lower revenue across its segments. Results missed consensus.
Palo Alto Networks Inc. (NYSE: PANW) fell 4.22 percent after the network security platform issued its third-quarter revenue forecast.
Deckers Outdoor Corp. (NASDAQ: DECK) jumped 15.37 percent after the footwear and apparel designer reported its quarterly results and issued its outlook for 2013.
McDermott International (NYSE: MDR) slumped 15.88 percent after the engineering, procurement, construction and installation company forecast revenue for the full year below Wall Street expectations.
Mentor Graphics Corp. (NASDAQ: MENT) lost 5.14 percent after the supplier of electronic design automation tools issued earnings outlook that trailed market projections.
European markets closed mixed, with Germany's DAX down 0.43 percent to close at 7,708.16. France's CAC40 shed 0.62 percent to finish at 3,699.91 The U.K.'s FTSE 100 rose 0.28 percent to end at 6,378.60.
Among Asian markets, the Shanghai Composite Index slid 0.26 percent to end at $2,359.51. Japan's Nikkei 225 added 0.41 percent to end at 11,606.38. Hong Kong's Hang Seng Index lost 0.61 percent to close at 22,880.22. India's Sensex closed at 18,918.52, up 0.30 percent.
Commodity & Currency Scan
Crude oil futures fell 1.21 percent to $90.93 per barrel, and natural gas futures dropped 0.86 percent to $3.46 per million metric British thermal units. Gold futures lost 0.15 percent to $1,576 per ounce while silver futures rose 0.43 percent to $28.56 per ounce.
In the currency market, the euro retreated 0.27 percent against the U.S. dollar at 1.3022. The British pound retreated 0.92 percent against the greenback to 1.5024, while the dollar jumped 1.11 percent against the Japanese yen at 93.5900.