Stocks rose on Thursday as investors bet on a year-end rally, while talk of a possible merger by telecommunications companies Sprint and Nextel and upbeat earnings from chip maker National Semiconductor Corp. fueled buying.
Procter & Gamble Co. pulled blue chips higher a day after the consumer products maker boosted
its sales forecast for fiscal 2005 and said full-year earnings would hit the high end of Wall Street estimates. It rose 2 per cent, or $1.35, to $56.38.
"There seems to be a consensus that we're due for a year-end rally, and weakness is considered an opportunity to buy," said Michael Metz, chief investment strategist at Oppenheimer & Co.
The Dow Jones industrial average was up 58.59 points, or 0.56 per cent, at 10,552.82. The Standard & Poor's 500 Index was up 6.43 points, or 0.54 per cent, at 1,189.24. The technology-laced Nasdaq Composite Index was up 2.90 points, or 0.14 per cent, at 2,129.01.
Trading was heavy, with 1.6 billion shares changing hands on the New York Stock Exchange, above the 1.4 billion daily average for last year. About 2.26 billion shares were traded on Nasdaq, above the 1.69 billion daily average last year.
Advancers outnumbered decliners on the NYSE by about 6 to 5, while decliners outnumbered advancers by about 9 to 7 on Nasdaq.
Shares of Sprint Corp. jumped 8 per cent, or $1.78 to $24.28 while Nextel Communications Inc. rose 7 per cent, or $1.84 to $29.81, after the Wall Street Journal website reported the two wireless carriers were in merger discussions.
Stocks rallied shortly after reports of the Sprint-Nextel talks, while an earlier spurt of buying was sparked by National Semiconductor's earnings news.
"A lot of times, traders, active money managers, hedge funds, are looking for any excuse to get off dead center and do something. The Sprint news, as small as it was, might have been the catalyst," said Hugh Johnson, chief investment officer at First Albany Corp.
Nextel was the biggest gainer by index points on the Nasdaq, while Sprint was the third biggest upward influence on the S&P.
National Semiconductor's shares jumped 5 per cent, or 79 cents, to $16.79, after the S&P 500 index component said profit rose and that problems with excess inventory in the distribution channel were behind it.
That helped offset the impact of reports from chip makers Altera Corp. and Xilinx Inc., who late on Wednesday cut quarterly sales forecasts. Altera fell nearly 8 per cent, or $1.73, to $20.47, while Xilinx was 3.3 per cent lower, or $1.01 at $29.72.
Among other movers, telecommunications equipment maker Ciena Corp. surged 23 per cent, or 54 cents, to $2.88 after posting better-than-expected revenues.
The market shook off US crude oil futures rising as several Opec members called for the cartel to rein in production. High crude prices can have a negative impact corporate profits and consumer spending.
Crude for January delivery settled up 59 cents at $42.53 a barrel on the New York Mercantile Exchange. Still, the price was down from session highs of $43.20 and much lower than its recent highs of more than $50.
But the dollar clung to small gains as traders adjusted their positions and held tightly to whatever profits they have made this year. The dollar has been on a downward path, causing concerns for investors, as a weak greenback dissuades foreign investment in US assets.
"There's a feeling that the worst for the dollar is behind us, at least short term and this is positive for the equity market," said Metz.
"Oil prices are still really down and not a cause of great concern at the moment - they're in reasonable shape." Reuters
- REUTERS
Stocks rose on Thursday as investors bet on a year-end rally, while talk of a possible merger by telecommunications companies Sprint and Nextel and upbeat earnings from chip maker National Semiconductor Corp. fueled buying.
Procter & Gamble Co. pulled blue chips higher a day after the consumer products maker boosted
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