* Dow hits 14,000 for first time since Oct 2007
* Ford, GM shares up after January sales numbers
* Dell shares jump; sources say its near buyout deal
* Dow, S&P up 1 pct, Nasdaq up 1.1 pct
By Rodrigo Campos
NEW YORK, Feb 1 (Reuters) - U.S. stocks climbed to five-year
highs on Friday in the wake of jobs and manufacturing data that
showed the economy's sluggish recovery is still on track.
The Dow industrials rose to 14,000 for the first time since
mid-October 2007 and the S&P hit its highest since December that
year. The S&P advanced 5 percent in January, its best start to a
year since 1997.
Analysts attributed the market's robust showing so far this
year partly to a deluge of cash flowing into equities.
Data on Thursday showed investors poured $12.7 billion into
U.S.-based stock mutual funds and exchange-traded funds in the
latest week, concluding the strongest four-week flows into stock
funds since 1996.
"There's a lot of money looking for a home and people are
finally deciding the bond market is done and moving money into
equities," said Edward Simmons, managing director and partner at
HighTower in Portland, Maine.
"I see the rotation (of assets) pushing the market up in the
face of not-massive amounts of good news," he said. "People are
overlooking the higher risk in equities."
Employment grew modestly in January, with 157,000 jobs added
in the month, slightly below expectations for 160,000. Still,
figures for both November and December were revised upwards.
Other reports released Friday showed the pace of growth in
the U.S. manufacturing sector picked up in January to its
highest level in nine months, U.S. consumer sentiment rose more
than expected last month, while December construction spending
also beat forecasts.
"All the data seems to keep pointing to a slowly, steadily
improving economy," said Eric Kuby, chief investment officer at
North Star Investment Management Corp in Chicago.
The Dow Jones industrial average rose 137.21 points
or 0.99 percent, to 13,997.79, the S&P 500 gained 14.81
points or 0.99 percent, to 1,512.92 and the Nasdaq Composite
added 34.76 points, or 1.11 percent, to 3,176.89.
With the day's gains, major equity indexes were on track for
a fifth straight week of gains. The S&P 500 is also coming off
its best monthly performance since October 2011.
Investors were also attuned to corporate earnings, with a
trio of Dow components reporting profits that beat expectations.
Exxon Mobil was little changed at $89.95 after its
results while Chevron added 0.8 percent to $116.10.
Drugmaker Merck & Co fell 2.9 percent to $42 after a
cautious 2013 outlook.
Generic drugmaker Perrigo reported a
better-than-expected second-quarter profit and its shares jumped
6.3 percent to $106.92, the largest advancer on the S&P 500.
Of the 252 companies in the S&P 500 that have reported
earnings so far, 69 percent have exceeded expectations,
according to Thomson Reuters data. That is a higher proportion
than over the past four quarters and above average since 1994.
Overall, S&P 500 fourth-quarter earnings are estimated to
have grown 4.4 percent, according to the data, up from a 1.9
percent forecast at the start of the earnings season but well
below a 9.9 percent profit growth forecast on Oct. 1.
Dell Inc gained 4.2 percent to $13.80 after sources
said the company was nearing an agreement to sell itself to a
buyout consortium led by its founder Michael Dell and private
equity firm Silver Lake Partners.
Shares of General Motors and Ford Motor rose
after the two largest American automakers posted
better-than-expected U.S. auto sales for January.
GM gained 1.2 percent to $28.42 and Ford added 0.9 percent
Shares of Zoetis surged on its trading debut on the
New York Stock Exchange after its shares were priced at $26,
above the expected range. Zoetis was trading at $30.67 at
midday, after earlier climbing as high as $31.74.