US STOCKS-S&P 500, Dow hit records; earnings season jitters cap gains

(For a Reuters live blog on U.S., UK and European stock
markets, click LIVE/ or type LIVE/ in a news window.)
* Growth stocks set to outperform value for the second week
* Honeywell gains as brokerages raise price targets
* Dow up 0.4%, S&P 500 up 0.32%, Nasdaq up 0.10%

(Updates to mid-afternoon, changes byline)
By Chuck Mikolajczak
April 9 (Reuters) - The S&P 500 and the Dow climbed to
record highs on Friday, buoyed in part by gains in growth
stocks, but gains were muted ahead of the start of quarterly
earnings season next week.
Growth names .RLG have found their footing over the past
two weeks after being outperformed by value stocks .RLV for
most of the year. A pullback in the 10-year U.S. Treasury yield
from a 14-month high hit in late March boosted confidence in
economic growth. Data showed U.S. producer prices increased more than
expected in March, bringing the largest annual gain in 9-1/2
years. Many investors now expect higher inflation as vaccine
rollouts help the U.S. economy rebound from coronavirus-fueled
lockdowns, yet stocks showed little concern over the data as the
Federal Reserve has maintained it will allow inflation to
overshoot its target. "I can understand why investors would say I am not going to
get freaked out price-wise because the reflation trade will be
beneficial to earnings," said Sam Stovall, chief investment
strategist at CFRA Research in New York.
"They are taking the bad with the good, the good being if
the economy is going to go up and earnings are going to
increase, hey I will take some inflation with that, because I
don't think the inflation is going to undo any of the profit
margin expansion that I expect to see."
The Dow Jones Industrial Average .DJI rose 134.94 points,
or 0.4%, to 33,638.51, the S&P 500 .SPX gained 13.22 points,
or 0.32%, to 4,110.39 and the Nasdaq Composite .IXIC added
14.43 points, or 0.1%, to 13,843.74.
The banks will kick off first-quarter earnings season next
week, and analysts expect profits for S&P 500 firms to show a
25% jump from a year earlier, the strongest performance for the
quarter since 2018, according to Refinitiv IBES data.
Megacap names such as Apple AAPL.O , Amazon AMZN.O and
Microsoft MSFT.O , which are in the growth index, advanced to
pace the S&P 500. Amazon shares rose 1.96% as warehouse workers
in Alabama rejected an attempt to form a union. The Russell 1000 growth index, made up largely of technology
stocks, is poised to outperform its value counterpart .RLV ,
made up mostly of cyclical stocks such as financials .SPSY and
energy .SPNY names, for a second week following the recent
pullback in longer-dated Treasury yields. Bank of America's weekly fund flow figures showed investors
have pumped more money into equities over the past five months
than in the last 12 years. Honeywell HON.N gained about 2.44% to help lift the Dow as
Jefferies and J.P. Morgan raised their price targets on the U.S.
aero parts maker's shares.
Declining issues outnumbered advancing ones on the NYSE by a
1.02-to-1 ratio; on Nasdaq, a 1.63-to-1 ratio favored decliners.
The S&P 500 posted 45 new 52-week highs and no new lows; the
Nasdaq Composite recorded 67 new highs and 39 new lows.