US STOCKS-S&P 500 ends at record on housing, HP; transports fly

Reuters - UK Focus

* Hewlett-Packard shares soar after announcing job cuts

* DJ Transportation Average ends at a record high

* CBOE Volatility Index, or VIX, at lowest level since March2013

* Dow up 0.4 pct; S&P 500 up 0.4 pct; Nasdaq up 0.8 pct (Updates to close)

By Angela Moon

NEW YORK (Frankfurt: HX6.F - news) , May 23 (Reuters) - The S&P 500 closed at a recordhigh on Friday, buoyed by a rally in housing stocks afterbetter-than-expected home sales and a jump in Hewlett-Packardshares a day after the personal computer maker said it would cutmore jobs.

The S&P 500 ended above 1,900, just below a record intradayhigh of 1,902.17 set on May 13 and above its record closing highof 1,897.45 the same day.

Eight of the 10 S&P sector indexes ended higher for the day.

The Dow Jones Transportation Average rose 0.8 percentto close at a record high, after hitting a lifetime intradayhigh of 7,995.39.

Housing stocks ranked among the market's biggestoutperformers, with the housing index up 1.9 percent.

Big tech names like Apple Inc (NasdaqGS: AAPL - news) and Amazon lifted the Nasdaq and helped it outperform the broader market.Apple shares ended up 1.1 percent at $614.13. Amazon sharesjumped 2.4 percent to $312.24.

Hewlett-Packard jumped 6.1 percent to $33.72. Thestock was among the S&P 500's best performers a day after thepersonal computer maker said it may cut as many as 16,000 morejobs in a major ramp-up of CEO Meg Whitman's years-long effortto turn the company around and relieve pressure on its profitmargins.

The CBOE Volatility Index, or VIX, fell 5.6 percentto end at 11.36, its lowest level since March 2013. Known asWall Street's fear index, the VIX is extremely low by historicalstandards.

The VIX, at those levels, shows investors' lack of anxietyand "a certain amount of complacency," said Donald Selkin, chiefmarket strategist at National Securities in New York.

"The lower the VIX, the more overbought the market gets,leaving it vulnerable to some kind of setback," Selkin said.

The Dow Jones industrial average rose 63.19 points or0.38 percent, to 16,606.27. The S&P 500 gained 8.04points or 0.42 percent, to end at 1,900.53, a record. The NasdaqComposite added 31.47 points or 0.76 percent, to4,185.81.

The S&P 500 posted its fifth daily advance out of the pastsix sessions, and its first weekly gain out of the past three.

For the week, the Dow rose 0.7 percent, the S&P 500 jumped1.2 percent and the Nasdaq gained 2.3 percent.

A total of 146 stocks on the Big Board and Nasdaq touched52-week highs, while just 26 issues hit 52-week lows. Two of theissues hitting 52-week lows on the Nasdaq are exchange-tradedsecurities that track volatility.


Housing stocks rallied for a second day after data from theCommerce Department showed sales of new U.S. single-family homesrose more than expected in April and the supply of houses on themarket hit a 3-1/2 year high. A day ago, another report showedexisting home sales rebounded in April.

Shares of Lennar Corp (NYSE: LEN - news) , the second-largest U.S.homebuilder in terms of revenue, shot up 4 percent to $40.54.The stock of top U.S. homebuilder D.R. Horton Inc climbed 4.1 percent to $23.57.

The Russell 2000 index of small-cap shares rose 1.1 percent, outperforming the broader S&P 500. The Russell fellinto correction territory last week - defined as a 10 percentdecline from a recent closing high.

Among transportation stocks, about a quarter of the DowJones Transportation Average marked fresh 52-week highs,including three airlines - Delta, Southwest andAlaska Air (NYSE: ALK - news) - and two railroads - Norfolk Southern (Frankfurt: NFS.F - news) and Union Pacific (Berlin: UNP.BE - news) .

FedEx (Hamburg: FDX.HM - news) shares jumped 1.6 percent to $141.50.

Bucking Friday's modest upswing was Aeropostale (NYSE: ARO - news) ,which slid 24.6 percent to $3.41 after the teen apparel retailerforecast a bigger-than-expected loss for the current quarter.

Volume was light going into the Memorial Day holidayweekend, when the U.S. stock market will be closed on Monday.About 4.6 million shares traded on all U.S. platforms, belowMay's average of 5.9 million, according to BATS exchange data.

Two stocks rose for every one that fell on the New YorkStock Exchange, while gainers outnumbered decliners on theNasdaq Stock Market by a ratio of nearly 3 to 1. (Reporting by Angela Moon; Editing by Jan Paschal)

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