Feb. 16, 2006, 4:15PM
Dow hits new 4 1/2-year high
Associated Press
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-->NEW YORK — Stocks posted moderate gains today, buoyed by Hewlett-Packard Co.'s earnings, a surprising jump in home construction and more positive comments from the Federal Reserve. The Dow Jones industrial average posted a new 4 1/2 -year high on a late surge in trading.
Hewlett-Packard's ongoing turnaround encouraged buying in the technology sector and helped the Dow reach its highest level since June 5, 2001, demonstrating Wall Street's confidence in large-cap stocks.
Investors' economic worries were eased as the news on home construction, which jumped 14.5 percent last month, followed a bullish economic outlook from new Federal Reserve Chairman Ben Bernanke.
"Clearly, the market has turned for the better here," said Joseph Battipaglia, chief investment officer at Ryan Beck & Co. "You're seeing today some of the ebb and flow that's to be expected in a market like this, but with Bernanke saying the economy is still powering ahead, this is not a bad environment to be in."
However, with the major indexes posting substantial gains for the week, today's trading was lackluster until the last half-hour of the session, when St. Louis Fed President William Poole said the Fed was close to stopping interest rate hikes.
The Dow rose 61.71, or 0.56 percent, to 11,120.68.
Broader stock indicators also posted modest gains. The Standard & Poor's 500 index rose 9.38, or 0.73 percent, to 1,289.38, and the tech-focused Nasdaq composite index added 18.20, or 0.8 percent, to 2,294.63.
Bonds were little changed, with the yield on the 10-year Treasury note falling to 4.59 percent from 4.60 percent late Wednesday. The dollar rose against most major currencies, while gold prices fell.
A jump in oil prices limited the stock market's gains. A barrel of light crude settled at $58.46, up 81 cents, on the New York Mercantile Exchange.
The recent drop in oil below $60 per barrel, combined with strong earnings and Bernanke's testimony, spurred this week's rally. However, some analysts question whether future uncertainties, such as slower economic growth or a reverse in oil prices, could keep stocks from building on their gains.
"Nobody wants to get ahead of things," said Jeff Kleintop, chief investment strategist for PNC Financial Services Group in Philadelphia. "The stuff that could happen later in the year could be creeping into things now, which is keeping us flatter than I would've liked."
Hewlett-Packard rose $2.35, or 7.4 percent, to $34.02 after beating Wall Street's earnings estimates by 4 cents per share on strong notebook computer sales and success in cost cutting initiatives. Credit Suisse analysts subsequently raised the company's stock rating to "outperform" from "market perform."
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H-P's impact on the tech sector may have been limited as investors waited to see quarterly earnings from rival Dell Inc., due after the session. Dell added 19 cents to $31.96 before the report.
Target Corp. said its fourth-quarter earnings rose 14 percent, helped by a number of new stores as well as better sales at existing locations. The retailer beat Wall Street's earnings forecasts by a penny per share. Target nonetheless lost $1.21 to $54.59 as investors worried about the company's expenses.
Department store operator J.C. Penney Co. Inc. gained $1.22 to $57.85 after the company reported a 65 percent surge in fourth-quarter profits and issued a bullish earnings forecast for 2006. The company's earnings beat analysts' expectations by 8 cents per share.
XM Satellite Radio Holdings Inc. tumbled $1.27, or 5 percent, to $23.98 after it posted a wider-than-expected loss for the fourth quarter, and one of its directors quit the company board and warned of an impending crisis.
Advancing issues outnumbered decliners by nearly 7 to 3 on the New York Stock Exchange, where preliminary consolidated volume came to 2.3 billion shares, compared with 2.46 billion traded on Wednesday.
The Russell 2000 index of smaller companies rose 6.82, or 0.94 percent, to 731.92,
Overseas, Japan's Nikkei stock average rose 0.7 percent. In Europe, Britain's FTSE 100 closed up 0.65 percent, France's CAC-40 gained 0.79 percent for the session, and Germany's DAX index climbed 0.43 percent.
Dow hits new 4 1/2-year high
Associated Press
<!-- commented out ad <iframe width="1" height="1" marginwidth="0" marginheight="0" frameborder=0 scrolling=no></iframe> <script></script>
-->NEW YORK — Stocks posted moderate gains today, buoyed by Hewlett-Packard Co.'s earnings, a surprising jump in home construction and more positive comments from the Federal Reserve. The Dow Jones industrial average posted a new 4 1/2 -year high on a late surge in trading.
Hewlett-Packard's ongoing turnaround encouraged buying in the technology sector and helped the Dow reach its highest level since June 5, 2001, demonstrating Wall Street's confidence in large-cap stocks.
Investors' economic worries were eased as the news on home construction, which jumped 14.5 percent last month, followed a bullish economic outlook from new Federal Reserve Chairman Ben Bernanke.
"Clearly, the market has turned for the better here," said Joseph Battipaglia, chief investment officer at Ryan Beck & Co. "You're seeing today some of the ebb and flow that's to be expected in a market like this, but with Bernanke saying the economy is still powering ahead, this is not a bad environment to be in."
However, with the major indexes posting substantial gains for the week, today's trading was lackluster until the last half-hour of the session, when St. Louis Fed President William Poole said the Fed was close to stopping interest rate hikes.
The Dow rose 61.71, or 0.56 percent, to 11,120.68.
Broader stock indicators also posted modest gains. The Standard & Poor's 500 index rose 9.38, or 0.73 percent, to 1,289.38, and the tech-focused Nasdaq composite index added 18.20, or 0.8 percent, to 2,294.63.
Bonds were little changed, with the yield on the 10-year Treasury note falling to 4.59 percent from 4.60 percent late Wednesday. The dollar rose against most major currencies, while gold prices fell.
A jump in oil prices limited the stock market's gains. A barrel of light crude settled at $58.46, up 81 cents, on the New York Mercantile Exchange.
The recent drop in oil below $60 per barrel, combined with strong earnings and Bernanke's testimony, spurred this week's rally. However, some analysts question whether future uncertainties, such as slower economic growth or a reverse in oil prices, could keep stocks from building on their gains.
"Nobody wants to get ahead of things," said Jeff Kleintop, chief investment strategist for PNC Financial Services Group in Philadelphia. "The stuff that could happen later in the year could be creeping into things now, which is keeping us flatter than I would've liked."
Hewlett-Packard rose $2.35, or 7.4 percent, to $34.02 after beating Wall Street's earnings estimates by 4 cents per share on strong notebook computer sales and success in cost cutting initiatives. Credit Suisse analysts subsequently raised the company's stock rating to "outperform" from "market perform."
<!-- adPro.mpl: (/disp/story.mpl/front) (elapsed 0.186 milli) (Thu Feb 16 18:58:27 2006) --><!-- DART AdSpace 300x250 - News - Top Story --><!-- /DART AdSpace -->
H-P's impact on the tech sector may have been limited as investors waited to see quarterly earnings from rival Dell Inc., due after the session. Dell added 19 cents to $31.96 before the report.
Target Corp. said its fourth-quarter earnings rose 14 percent, helped by a number of new stores as well as better sales at existing locations. The retailer beat Wall Street's earnings forecasts by a penny per share. Target nonetheless lost $1.21 to $54.59 as investors worried about the company's expenses.
Department store operator J.C. Penney Co. Inc. gained $1.22 to $57.85 after the company reported a 65 percent surge in fourth-quarter profits and issued a bullish earnings forecast for 2006. The company's earnings beat analysts' expectations by 8 cents per share.
XM Satellite Radio Holdings Inc. tumbled $1.27, or 5 percent, to $23.98 after it posted a wider-than-expected loss for the fourth quarter, and one of its directors quit the company board and warned of an impending crisis.
Advancing issues outnumbered decliners by nearly 7 to 3 on the New York Stock Exchange, where preliminary consolidated volume came to 2.3 billion shares, compared with 2.46 billion traded on Wednesday.
The Russell 2000 index of smaller companies rose 6.82, or 0.94 percent, to 731.92,
Overseas, Japan's Nikkei stock average rose 0.7 percent. In Europe, Britain's FTSE 100 closed up 0.65 percent, France's CAC-40 gained 0.79 percent for the session, and Germany's DAX index climbed 0.43 percent.
Keep on rockin.
