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Stocks Post Modest Gains Sending Dow, S&P 500 to New Closing Highs

The market ended modestly higher after strong earnings from Citigroup helped offset unimpressive economic data here and abroad. The Dow and S&P 500 set new record closing highs, but still have not topped intraday highs hit in late May. Here at home June retail sales disappointed. The Commerce Department logged just a 0.4% increase for the month when expectations were for 0.8%. Separately, business inventories ticked up 0.1% percent in May, when economists had forecast they would be unchanged. Overseas, the Chinese government says GDP during the second quarter grew at an annual rate of 7.5% down from 7.7% in the prior quarter.

Citigroup (C) enjoyed solid gains rising 2% on its quarterly earnings. The company beat estimates posting $1.25 a share. Expectations had been for $1.17. Revenue also beat, topping $20 billion dollars for the quarter when consensus had been for $19.74 billion. Citi's profits were up 42% over the same period a year ago. Since then the company has cut costs by firing thousands of workers and scaling back operations in less profitable countries. The stock is up a whopping 90% over the past year.

Boeing (BA) bounced back more than 3% after falling 5% on Friday. The drop stemmed from troubles with two of the company's 787 Dreamliners. In one case a plane parked at London's Heathrow Airport caught fire. In the other a 787 headed from England to Florida had to turn around because of a technical issue. Investigators say the fire had nothing to do with the plane's lithium batteries which were previously labeled a fire hazard and lead to a grounding of all 787s for several months. Despite the troubles with the Dreamliner, shares of Boeing have been up 32% this year.

Leap Wireless (LEAP) has more than doubled since Friday when AT&T (T) announced plans to acquire the pay-as-you-go cell carrier. AT&T will be paying $1.2 billion for Leap. The acquisition will give the company more airwaves. There is also talk that this could be the beginning of an AT&T buying spree. The company may be looking at Europe in particular to increase as a way of expanding. AT&T stock is up just 2% so far this year as it struggles to grow profits with its existing businesses.

BlackBerry (BBRY) shares rose over 1% on news that it has started deep discounts of its flagship Z10 smartphone. Major carriers are now offering the device for just $49, which is 75% off the original price. Smartphones often come down in price as carriers look to unload old inventory ahead of new releases. In this case, however, the discount is a further sign that the new phone has failed to generate much excitement.

Tiffany (TIF) climbed over 3% on an upgrade. David Schick of Stifel Nicolaus raised the company to "buy" from "hold" and set a price target of $92. Shares opened the day at about $77. The analyst's note says business in the U.S. is improving as people start to feel wealthier.

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