NewsJuly 21, 2009
NEW YORK -- Stocks jumped again Monday, giving the Dow Jones industrials their sixth straight advance, as investors got more robust earnings news from big companies and data that suggest the economy is closer to a recovery. A 100-point gain pushed the Dow back into the black for the year, while the Standard & Poor's 500 climbed to its highest finish since November...
The Associated Press

NEW YORK -- Stocks jumped again Monday, giving the Dow Jones industrials their sixth straight advance, as investors got more robust earnings news from big companies and data that suggest the economy is closer to a recovery.

A 100-point gain pushed the Dow back into the black for the year, while the Standard & Poor's 500 climbed to its highest finish since November.

The Conference Board's index of leading economic indicators rose 0.7 percent in June, more than the 0.4 percent forecast.

It was the third straight month of gains in the predictor of future economic activity.

Market indicators jumped about 7 percent last week following a monthlong slide driven by discouraging reports on the economy. Solid earnings and outlooks from leading companies including Goldman Sachs Group Inc., Intel Corp. and International Business Machines Corp. gave investors hope that the worst of the recession could be past.

An even busier week of earnings reports will further shape investors' view of the economy. Reports are due Tuesday from industrial equipment maker Caterpillar Inc. and drug maker Merck & Co.

Among the companies reporting Monday was toy maker Hasbro Inc., which beat the market's expectations and helped reassure investors somewhat about consumers' willingness to spend.

George F. Shipp, chief investment officer at Scott & Stringfellow in Virginia Beach, Va., said word that CIT might be able to sidestep bankruptcy gave investors another sign that the economy and the markets are healing because the government wasn't forced to intervene.

"The private sector is stepping in where the taxpayer didn't have to this particular time. That's the way it's supposed to work," he said.

The Dow rose 104.21, or 1.2 percent, to 8,848.15. The six-day gain is the longest increase since a seven-day rise in April 2007.

Wall Street's best-known index ended at its highest level since Jan. 6. The last time the Dow was this high stocks were just about to endure a steep drop that left the blue chips at a 12-year low on March 9.

The Dow is up 35 percent from its March low but still down 37.5 percent from its record of 14,164.53 in October 2007.

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The S&P 500 index rose 10.75, or 1.1 percent, to 951.13, its best finish since Nov. 5. November's lows last year came after months of brutal selling as the financial crisis intensified in the fall with the collapse of Lehman Brothers. Investors had hoped the November lows would be the bottom of the market's retreat but stocks slid further by March.

The Nasdaq composite index rose 22.68, or 1.2 percent, to 1,909.29, its ninth straight advance. The index is at its highest mark since Oct. 3, during the most furious selling of the credit crisis.

Among the earnings news, Hasbro's profit rose 5 percent, beating expectations, as strong U.S. revenue offset international sales hurt by the stronger dollar. The stock gained 4.2 percent, rising $1.07 to $26.45.

Oilfield services company Halliburton Co. said its profit tumbled 48 percent amid sluggish exploration and production activity, but the results were better than analyst forecasts and its shares rose 95 cents, or 4.4 percent, to $22.33.

With the bulk of earnings reports still to come, the market has yet to hear from some key industries including retailing. If those results are disappointing, it could force investors to rethink their most recent rally. Several factors are still hanging over the market including record-high unemployment and a damaged housing market.

Some analysts said the market could have a hard time advancing, even with more welcome developments.

"The market itself has hit kind of a top here temporarily. People are already getting used to the earnings," said Matt Lloyd, chief investment strategist at Advisors Asset Management.

On Monday, though, the CIT news and optimism over better earnings reports stoked investors' appetite for risk. CIT jumped 55 cents, or 79 percent, to $1.25.

Commodity prices advanced and the dollar was mixed. Oil prices rose 42 cents to settle at $63.98 a barrel. Gold rose.

Bond prices rose, pushing yields lower. The yield on the benchmark 10-year Treasury note fell to 3.60 percent from 3.66 percent late Friday.

Advancing stocks outnumbered those that fell by more than 3-to-1 on the New York Stock Exchange, where consolidated volume came to 4.9 billion shares compared with 5 billion traded Friday.

The Russell 2000 index of smaller companies rose 7.74, or 1.5 percent, to 526.96.

Overseas, Britain's FTSE 100 rose 1.3 percent, Germany's DAX index rose 1 percent, and France's CAC-40 gained 1.6 percent. Japanese financial markets were closed for a holiday.

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