US stocks: Dow closes at 6-year high

NEW YORK - The Dow Jones industrial average ended at the highest level in six years todayas encouraging quarterly reports from companies such as General Motors Corp. increased optimism about earnings.

Tech shares slid and the Nasdaq fell after Web auctioneer eBay Inc. gave a disappointing revenue forecast.

The Dow is not far from its lifetime high of 11,750.28, which it hit on Jan. 14, 2000. The Nasdaq and the Standard & Poor's 500 Index hit five-year intraday highs.

After the bell, Google shares jumped 7 per cent to $443.96 in electronic trading from a Nasdaq close at $415. Google Inc., the leading Web search company, reported its quarterly net income and revenue surged, driven by gains in market share against rivals such as Yahoo Inc. and Microsoft Corp.

"Another fantastic quarter here. When we've seen the market share gains that Google has had, it doesn't necessarily come as a surprise," said Rick Summer, a Morningstar analyst in Chicago. But he added that "eventually, you can only grow as fast as an advertising market can grow." During the regular session, General Motors gave the biggest boost to the Dow after it reported a narrower-than-expected loss and said its turnaround was working. Shares of the world's largest automaker jumped 10.1 per cent.

The Dow Jones industrial average gained 64.12 points, or 0.57 per cent, to end at 11,342.89. The Standard & Poor's 500 Index rose 1.53 points, or 0.12 per cent, to finish at 1,311.46. But the Nasdaq Composite Index fell 8.33 points, or 0.35 per cent, to close at 2,362.55.

For the Dow, this was the highest close since Jan. 20, 2000.

The final week of trading for April stock options typically creates volatility as traders adjust their positions.

Shares of eBay dropped 8.9 per cent, or $3.58, to $36.77 after it gave a conservative forecast. The stock was the heaviest drag on both the Nasdaq and the S&P 500.

GM shot up 10.1 per cent, or $2.07, to $22.64 on the New York Stock Exchange after the automaker posted a narrower first-quarter net loss that beat expectations.

Shares of Altria Group Inc. rose 1.6 per cent, or $1.08, to $70.04 after the Dow component and the parent of cigarette maker Philip Morris reported a profit that beat estimates by a penny.

Overall, earnings reports for the last quarter have been strong, said Jon Brorson, managing director of growth equities at Neuberger Berman.

"Our forecast was for earnings to come in around 13 per cent year-over-year growth, and they're on track to do it," Brorson said. "They are surprisingly better than expected, and outlooks have been good, generally speaking." In other earnings news, Bank of America Corp.'s profit beat estimates. Shares of the No. 2 US bank rose 0.5 per cent, or 23 cents, to $46.28.

"Today, it can be summed up with GM, eBay and metals and mining stocks," Brorson added.

Shares of metals mining companies slid as gold and silver prices retreated from their highest levels since the early 1980s. Gold in New York had touched a 25-year peak of late, while silver hit a 23-year record. Both gold and silver have gone on dramatic runs in recent months, as have other metals and oil.

The CBOE Gold Index slid 6.6 per cent, with all 11 components lower, while the broader Philadelphia Gold/Silver Index was off 6.1 per cent.

Among the day's biggest percentage decliners was Rambus Inc., whose shares sank 17.4 per cent, or $8.10, to $38.50. The stock fell in late trading amid market talk that the technology developer had lost its patent infringement case against South Korea's Hynix Semiconductor.

But the stock's price recovered slightly after Rambus said no verdict had yet been reached. The stock was up 3 per cent at $39.65 in extended-hours trading on Inet.

Energy-related shares such as Exxon Mobil Corp. slipped as US crude oil for May delivery fell 22 cents to settle at $71.95 a barrel -- off a record high at $72.49 hit in electronic trading overnight. The May crude contract expired on Thursday at the close of Nymex trading.

Exxon Mobil shares fell 0.6 per cent, or 38 cents, to $63.92.

Volume was heavy on the New York Stock Exchange, where about 1.78 billion shares changed hands, above last year's daily average of 1.61 billion. On Nasdaq, about 2.21 billion shares traded, above last year's daily average of 1.80 billion.

Declining stocks outpaced advancing ones on the NYSE by a ratio of about 9 to 8, while on the Nasdaq, about five stocks fell for every four that rose.

- REUTERS