Stocks rallied on Wednesday, with the S&P 500 hitting a record, as data cast an upbeat light on manufacturing in the New York region and Bank of America reported earnings and revenue that topped Wall Street's expectations.
The Dow Jones Industrial Average, which rose 115 points on Tuesday, had another triple-digit climb and closed 108 points ahead.
Clearing 2014 losses, at least for much of the session, and hitting an intraday record of 1,850.89, the S&P 500 gained 9 points, while the Nasdaq added 31 points for a 13-year high.
"We have strong economic momentum coming into the new year. Stocks are no longer cheap, but they are not overvalued," said Kate Warne, investment strategist at Edward Jones. "With the momentum we're seeing in the economy, even the interest-rate-sensitive sectors can absorb it," she added.
Wall Street continued its surge after the release of the Federal Reserve's Beige Book, which found the economy to be expanding at a moderate pace, with some districts reporting a pickup in growth.
"People think the economy is on fairly good ground here, and they are starting to pile in; equities are largely under-owned, and people are getting statements from last year and starting to allocate to equities," said Joe Costigan, director of equity research at Bryn Mawr Trust.
Bank of America rose over 2 percent after the lender reported fourth-quarter earnings and revenue that topped estimates. Tesla Motors climbed after CEO Elon Musk said the electric-car maker expects to ship its first Model S vehicles to China in March. Apple gained after China Mobile said advance orders for iPhones had hit 1 million, and remained higher as the consumer-technology company agreed to settle with the Federal Trade Commission over a loophole that once let kids make in-app purchases without their parents' consent.
"For those suggesting the market 'needs' earnings growth or something along those lines, we'd point out that is exactly what is occurring," emailed Dan Greenhaus, chief strategist at BTIG, who added that fourth-quarter earnings should come in roughly 23 percent ahead of fourth-quarter results from 2012.
Earlier data showed manufacturing in the New York region increasing in January, with the Federal Reserve Bank of New York's economic index rising to 12.51. Another report had U.S. wholesale prices rising in December, with inflation pressures remaining benign.
On the New York Mercantile Exchange, crude-oil futures for February delivery gained $1.58, or 1.7 percent, to $94.17 a barrel and gold futures for February delivery lost $7.10, or 0.6 percent, to $1,238.30 an ounce.
The dollar turned flat against the currencies of major U.S. trading partners and the yield of the 10-year Treasury note rose 1 basis point to 2.883percent.
On Tuesday, Wall Street chalked up its strongest performance in 2014 after upbeat retail-sales data for December helped offset concerns that came with Friday's monthly jobs report.