Dow Jones 30: Industrials Index

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Dow Sets Intraday Record

The Dow Jones Industrial Average reached a milestone Tuesday, setting an all-time intraday high, as crude prices plummeted below the $60 level.

After opening to the downside, the Dow recently was adding 83 points, or 0.7%, to 11,753, surpassing the old record that had been reached in January 2000.

The Dow was aided by gains of 1.5% or more in Boeing (BA:) , United Technologies (UTX:) and Honeywell (HON:) . Overall, 24 of the 30 components were in positive territory.

The other major indices were moving higher, as well. The S&P 500 was adding 3 points to 1332, and the Nasdaq Composite was up 11 points at 2248.

On Monday, a back-and-forth day started the fourth quarter, but ultimately the Dow lost 8.72 points, or 0.07%, to 11,670.35. Last week, the Dow was tantalizingly close to establishing a new high mark, but it couldn''t quite get it done.

"It''s not just that the Dow is going to an all-time high," said Paul Mendelsohn, chief investment officer with Windham Financial. "A lot of sectors are breaking out to records, giving us some good rotational activity. When you drop almost $2 in one day on crude prices, we should expect this type of huge move."

Lately, crude futures were losing $1.90 to $59.13 a barrel. Oil''s two-day decline has brought prices down $3.78, or 6%. Lehman Brothers downgraded the oil and gas sector to negative, and Merrill Lynch cut the energy sector to underweight.

Combined with oil''s slide, the downgrades pulled the Philadelphia Oil Service Sector Index lower by 2.7% and the Amex Oil Index down by 1.9%.

With no economic data on the docket, Treasuries were unchanged. The benchmark 10-year note was flat in price to yield 4.60%. The dollar weakened against the euro and rose against the Japanese yen. Elsewhere, gold was tumbling by $15.60 to $587.70 an ounce. Silver was losing 44 cents to $11.20 an ounce.

After the close of trading Monday, chipmaker Marvell (MRVL:) said its third-quarter revenue will be lower than expected and indicated that it will restate its past financial results because of discrepancies in its prior stock-option grants. Still, shares were adding 2 cents, or 3.1%, to 67 cents.

Those developments sent the shares sliding nearly 14% to $16.42, putting the stock below its 52-week low.

Also providing a forecast was bankrupt carrier Northwest Airlines (NWACQ:) , which said it should have a modest profit for the full year despite a softening in revenue since September and an expected loss for the last four months of 2006.

Pepsi Bottling Group (PBG:) posted a third-quarter profit of $207 million, or 86 cents a share, up 1% from last year. Results included a 4-cent-a-share loss from stock-based compensation and a 5-cents-a-share gain from changes to its taxes. Revenue rose to $3.46 billion, up 7.7% from a year ago.

The Thomson First Call consensus was for EPS of 81 cents on revenue of $3.41 billion. However, Pepsi Bottling was dropping $2.10, or 6%, to $33.13 on weak guidance and a downgrade by Deutsche Bank.

The phone-record snooping scandal at Hewlett-Packard (HPQ:) had CEO Mark Hurd in the headlines again, this time in the form a Wall Street Journal report that said he might have known about the program being used to plug boardroom leaks as early as July 2005.

However, citing a memo from an outside law firm, the report said Hurd doesn''t appear to have known that H-P investigators were using potentially illegal techniques. H-P was recently losing 41 cents, or 1.1%, to $37.25.

Retailers began posting same-store sales results for September. Walgreen (WAG:) said comp sales rose 8.5% in September, while Kohl''s (KSS:) said same-store sales were up 16% for the month.

Kohl''s also raised its third-quarter earnings estimate to a range between 56 cents and 59 cents a share. Currently, the average estimate stands at 56 cents a share. Kohl''s was recently higher by 75 cents, or 1.2%, to $66.24.

Department store chain Federated (FD:) said it has completed the sale of its Lord & Taylor division to NRDC Equity Partners for the final adjusted sale price of $1.08 billion, down from the initial sale price of $1.2 billion. Federated was falling by 21 cents, or 0.5%, to $42.93.

On the research front, Credit Suisse upgraded RF Micro Devices (RFMD:) to outperform from neutral and lifted Skyworks (SWKS:) to neutral from underperform. Stifel Nicolaus also raised its rating on Skyworks.

Overseas, Europe''s equities were falling. London''s FTSE 100 was losing 0.4% to 5937, and Frankfurt''s Xetra DAX eased 0.1% to 5992. Asia''s shares were mixed, with Tokyo''s Nikkei ending off 0.1% to 16,242 and Hong Kong''s Hang Seng higher by 0.4% to 17,606.

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Dow Continues Historic Run......

The Dow Jones Industrial Average continued to rewrite the record book, hitting a new all-time intraday high Thursday and crossing above 11,900 for the first time ever.

Lately, the Dow was gaining 70 points, or 0.6%, to 11,922. The index touched a fresh intraday record high of 11,934.73 earlier in the session. Of the 30 stocks on the index, 22 were up and eight were down.

Bear trap!
There has never been a market that can sustain a vertical move like this one. All of them crushed their investors when they least expected it.

Bears are now in hibernation! Meanwhile the Dow is heading for a breakout at 11,955. Target 12,328. Stop 11,824.

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One incredible statement........ ..... ..... ...... .......


CHUCK JAFFE
Dow 116,200
It'll be there -- in 2040 -- if historic returns hold
PrintE-mailDisable live quotesRSSDigg itDel.icio.usBy Chuck Jaffe, MarketWatch
Last Update: 11:05 AM ET Oct 11, 2006


BOSTON (MarketWatch) -- As the Dow Jones Industrial Average flirted with 12,000 last week, it reminded me of my all-time favorite expert market prediction. It was made in the fall of 1995, as the Dow was first approaching the 5,000 mark, by the late Bill Berger, the legendary investor who started the now-extinct Berger family of mutual funds.
At the time, investors were concerned that 5,000 would be a big psychological barrier and that the market could not handle the prosperity of that level without some significant setback.
   
   
Berger, a gentle giant of a man with an impish sense of humor, said he could not predict precisely what would happen when the magic 5,000 line was crossed, but said that he was fairly positive that the Dow would hit 116,200 in the year 2040.
The logic was simple: a Dow (DJIA : Dow Jones Industrial Average
Last: 11,960.51+12.81+0.11%

4:30pm 10/13/2006

11,960.51, +12.81, +0.1%) move to 116,200 over 45 years would be the same rate of growth he had seen as the Dow moved from 200 to 4,800 in his first 45 years as an investor.
Five years later, the Dow was in five-digit territory when the bear market arrived and threw investors for a loop.
Even as the Dow was stretching toward record highs this week, much bigger, broader indices remain well below their peak levels. The Dow Jones Wilshire 5000 is down 9% from its record level, with the Standard & Poor's 500 off 12% and the Nasdaq more than 50% removed from its all-time high.
It has been almost 11 years to the week since Berger made his forecast and a six-figure Dow would seem even more unlikely today than it did to an audience that was laughing at the man back then. Run the numbers, however, and it's not so silly. In spite of the bear market, the Dow actually is ahead of the pace needed for Berger's prediction to come true.
For the Dow to move from 4,800 in October of 1995 to 116,200 in October of 2040 would require an average annualized gain of roughly 7.3%.
By moving to within the shadow of 12,000 in 11 years, the Dow has posted an annualized average gain of roughly 8.6%. Moving from where the benchmark stands today to the 116,200 number over the next 34 years will require a gain of 6.7%, well below the Dow's annualized average return over time.
No big deal
The Dow may be the most quoted and recognized stock-market benchmark, but it is also one of the least useful. It's 30 component stocks represent less than 25% of the value of the Dow Jones Wilshire 5000 and less than one-third of the S&P. It's not a great indicator for the broad market -- and hasn't been used as such by anyone in the industry for years now -- as it represents mostly the biggest of the big stocks.
If anything, news that the Dow is near a record high is confirmation of what many market analysts have been expecting to see, namely a rally among large-cap stocks.
Look more closely, however, and even that conclusion is still a bit hard to draw. The Dow is a price-weighted index, meaning that gains in its highest-priced stocks will have the greatest impact; that allows the index to reach new highs even when most stocks in the index are not at peak levels. More than two-thirds of the Dow stocks are below all-time highs and more than half of the Dow components are still off 20% -- and as much as 70% -- from their pre-bear-market tops.
And the news that the Dow is ahead of schedule for Berger's big goal may not be quite as good as it seems. Last week, a Washington think tank called The Center on Budget and Policy Priorities noted that if the Dow is adjusted for inflation, it's still down 17% from its all-time high.
Ultimately, the Dow continues to holds its place of high esteem mostly because it's the brand name that average investors recognize. Investors shouldn't get too amped up or turned down based on its daily fluctuations, new highs or temporary lows. If the broad market is going in a long-term direction -- and until making his unique call on the Dow, Berger always said his long-term forecast always was "Up" -- the Dow will go with it.
But more than a decade after Berger's initial projection, his principal point still holds true: Buying high-quality, big-name stocks -- a small subgroup of a much larger market -- and holding onto them for long periods of time can be a solid underpinning of an investment portfolio, a steady and consistent part in the often-confusing task of building a nest egg.
The Dow's recent history also underscores the importance of diversifying a portfolio. For the last 20 years of the 20th century, investors came to learn that the stocks of big companies were the only sure ticket to a rich future. Berger's prediction came in the 13th year of an epic run; he didn't suggest the run would continue forever -- in fact he predicted a return to more historic norms -- but was making the point that investors would not need eons of enormous gains for the Dow to make huge progress.
Since the peak of the market, investors in the Dow have clearly learned that exposure to value stocks, small-cap stocks and international issues would have rounded out that base portfolio of mega-stocks, making for a smoother outcome and a healthier investment outlook.
Chances are that by the time 2040 rolls around, everyone but me will have forgotten Berger's unusual call. Increasingly, however, it looks like the people who heeded his call will get to 2040 feeling pretty good about their core investment decisions. 
Chuck Jaffe is a senior MarketWatch columnist. His work appears in dozens of U.S. newspapers.

 

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Interesting article......

The first part of this article is interesting. It looks at the current rally in terms of sentiment and momentum and compares to the 1997 crash. Because the S&P has rallied to new highs compared to a lower high in 1987 I think the comparison is flawed, but it's still interesting.


Link...... http://equitrend.com/equinews.aspx?week=mZCq3BRvphA=

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I'm wearing my party hat........




Dow Fights to maintain gains..............


The Dow Jones Industrial Average climbed above the 12,000 mark for the second consecutive session Thursday, but once again it was struggling to hold that level.

After bouncing around the break-even line, the Dow was recently up 9 points at 12,001. The S&P 500 was fractionally lower at 1365, and the Nasdaq Composite was down 3 points, or 0.1%, at 2334.

On Wednesday, the Dow hit an intraday record high of 12,049.51 before pulling back to settle up 42.66 points at 11,992.68, its eighth record close in the past two weeks.

"While the longer-term trend remains up, yesterday''s trading is a sharp warning," said Ken Tower, chief market strategist with CyberTrader. "Yesterday began with an upside burst. The failure of that burst to carry forward was not surprising, but the tepid afternoon rally that couldn''t rise above even the bounce high is worrisome."

Earnings continue to arrive at a furious pace, with results from both tech names and old-economy stocks arriving in force.

After the close of the prior session, Apple (AAPL:) posted fiscal fourth-quarter earnings of $546 million, or 62 cents a share, up 27% from the same quarter a year ago. Revenue surged to $4.84 billion from $3.68 billion last year. Results handily beat estimates, sending shares of Apple higher by $4.48, or 6%, to $79.01.

eBay (EBAY:) also opened higher after the Internet auctioneer posted a third-quarter profit of $280.9 million, or 20 cents a share, up 10% from a year earlier. Sales and adjusted earnings topped estimates. eBay was recently gaining $2.09, or 7.3%, to $30.58.

To view Farnoosh Torabi''s video take on today''s premarket action, click here.

On the other hand, Advanced Micro Devices (AMD:) dropped more than 11% after posting a significant decline in margins. Third-quarter earnings came in at $134 million, or 27 cents a share, up 76% from a year ago. AMD was down $2.73 to $21.50.

As a new day unfolded, several Dow components rolled out their numbers. McDonald''s (MCD:) said it had third-quarter earnings of $843.3 million, or 68 cents a share, meeting expectations. Revenue rose 10% to $5.8 billion. McDonald''s was sliding 62 cents, or 1.5%, to $40.85.

Pfizer (PFE:) posted third-quarter net income of $3.36 billion, or 46 cents a share, more than doubling the year-ago results. On a continuing operations basis, the drugmaker earned 44 cents, a penny short of estimates. However, revenue of $12.28 billion in the quarter beat expectations.

After announcing it will buy back up to $10 billion in shares next year, Pfizer warned that revenue levels for the next two years would be equal to that of 2006. Shares were off 9 cents, or 0.3%, to $28.01.

Shares of Coca-Cola (KO:) were up 2.3% after the company reported third-quarter net income that exceeded the Thomson First Call forecast by 3 cents a share. Coca-Cola was recently higher by $1.01 to $44.97.

Meanwhile, Citigroup (C:) was off 1.1% after posting a 23% decline in third-quarter earnings. Though earnings from continuing operations beat the Thomson First Call average estimate, third-quarter revenue missed targets. The stock was losing 56 cents to $49.63.

Honeywell (HON:) was also trading lower after the company said it had third-quarter earnings of $541 million, or 66 cents a share, up more than 16% from the same quarter last year. The company''s profits and sales were ahead of estimates, but the industrial giant cautioned of lower economic growth next year. Honeywell was off 98 cents, or 2.3%, to $41.65.

At Nokia (NOK:) , sales were better than expected, but profits were a bit light, while Ericsson''s (ERIC:) revenue rose 12% in the latest quarter.

Outside of earnings, crude futures were higher as OPEC convened in Qatar. The oil-exporting group is expected to cut output in order to halt the recent tumble in prices. Recently, oil was gaining 85 cents at $58.50 a barrel.

The economic docket was sparse, but in one report the Labor Department said initial jobless claims fell by 10,000 to 299,000 last week. Meanwhile, the Conference Board said the leading economic indicators for September rose 0.1%, shy of expectations for a 0.3% increase.

The Philadelphia Federal Reserve''s manufacturing index for October was weaker than expected for a second month, coming in at negative 0.7 vs. the forecast of positive 6.5. The number is based on a survey and is calculated by taking the difference in the percentage of respondents who report business improving and those who see it declining.

Overseas, European indices were little changed. London''s FTSE 100 added 0.1% to 6156, and Germany''s Xetra DAX was off 0.1% at 6177. Stocks fell in Asia, as Japan''s Nikkei finished 0.6% lower at 16,551 and Hong Kong''s Hang Seng was down 0.3% to 17,987.

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Dow Extends Record Climb

10/23/2006 3:39 PM EDT

The Dow Jones Industrial Average reached another milestone Monday as Wall Street headed higher following a slew of earnings reports from Old Economy companies.

After opening to the downside, the Dow was surging 108 points, or 0.9%, to 12,110. The index reached a new intraday record high of 12,125.16 earlier in the session. Components Wal-Mart (WMT:) , General Motors (GM:) , 3M (MMM:) and Caterpillar (CAT:) were leading the charge with gains of 2% or more.

Elsewhere, the S&P 500 was up 7 points, or 0.5%, at 1376, and the Nasdaq Composite was higher by 12 points, or 0.5%, to 2354.

"We''re overbought but we keep going higher," said Paul Mendelsohn, chief investment strategist with Windham Financial. "Earnings are coming in nicely, as we''re looking at 15% growth, so the momentum is taking the market wherever the bulls want it to go. We may also be seeing money coming in from overseas fueling this move."

The strength comes after stocks closed narrowly mixed Friday, when a selloff in Caterpillar kept the bulls from celebrating Google''s (GOOG:) huge quarter.

"More earnings this week and a Federal Reserve meeting are likely to dominate trader attention," said Ken Tower, chief market strategist with CyberTrader. "Longer-term traders may continue to sit back and enjoy the rally as the number of New York Stock Exchange stocks reaching 52-week new highs rose for the fourth straight week."

As the new week got started, earnings reports were rolling in. Among them was Ford (F:) , which reported a third-quarter loss of $5.8 billion, or $3.08 a share, and said it would restate its results back to 2001. Excluding items, the automaker had a loss from continuing operations of $1.2 billion, or 62 cents a share. Ford was falling 11 cents, or 1.4%, to $7.90.

Halliburton (HAL:) earned $615 million, or 58 cents a share, from continuing operations for the quarter ended Sept. 30, up from the year-ago''s $492 million, or 49 cents a share. Sales rose 19% from last year to $5.8 billion.

Analysts were looking for a 54-cent profit on sales of $5.54 billion. Halliburton was recently gaining 18 cents, or 0.6%, to $28.96.

Dow component AT&T (T:) posted a third-quarter profit of $2.17 billion, or 56 cents a share, up 74% from the same quarter last year. Excluding items, the company had adjusted earnings of 63 cents a share. Analysts expected the telecom giant to report EPS of 58 cents a share, according to Thomson First Call. AT&T reversed early weakness and was recently adding 26 cents, or 0.8%, to $34.70.

Toymaker Hasbro (HAS:) had a profit of $100 million, or 58 cents a share, for the quarter ended Oct. 1, compared with last year''s $92 million, or 47 cents a share. Sales rose to $1.04 billion from $988 million a year earlier. Sales and earnings topped estimates. Hasbro was higher by $2.26, or 9.7%, to $25.56.

American Express (AXP:) posted third-quarter earnings of $967 million, or 80 cents a share, down 6% from a year ago. Excluding items, the company earned 78 cents a share, beating estimates by 2 cents. Still, the stock was tumbling $1.18, or 2%, to $56.86.

After the closing bell, Texas Instruments (TXN:) will also release third-quarter results. Shares were up 1.2% to $31.75 ahead of the report.

IBM (IBM:) said it is suing Amazon.com (AMZN:) for infringing on some of its patents. The computer maker alleges that Amazon has illegally built its online retail store on technologies that IBM developed. Shares of IBM were gaining 1.3% to $91.61, and Amazon was unchanged at $32.74.

Outside of stocks, traders are bracing for the next interest rate decision from the Federal Reserve. Members of the policy making Federal Open Market Committee are gathering for the first day of a two-day meeting Tuesday, with their rate announcement scheduled for Wednesday afternoon. Fed funds futures continue to price in virtual certainty that policymakers will hold the benchmark interest rate at 5.25%.

Crude prices traded lower, as the newly benchmarked December contract extended Friday''s decline. Oil fell 52 cents to end the session at $58.81 a barrel. Gold dropped $13.50 to close at $582.90 an ounce, and silver lost 30 cents to $11.67 an ounce.

Overseas, European indices were moving higher, and stocks were mixed in Asia.

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Dow Makes History Again...................


After an uneven session marked by a deluge of earnings, a spike in oil prices and no surprises on the rate front, Wall Street ended slightly higher Wednesday.

The Dow Jones Industrial Average rose only 6.80 points, or 0.06%, to 12,134.68, yet that was enough for another record closing high. The index had been lower by as many as 43 points earlier, pressured by a decline in General Motors (GM:NYSE) .

The S&P 500 added 4.84 points, or 0.35%, to 1382.22, and the tech-heavy Nasdaq Composite gained 11.75 points, or 0.5%, to 2356.59. Big gainers included Amazon.com (AMZN:Nasdaq) and KLA-Tencor (KLAC:Nasdaq) .

Volume improved from Tuesday''s levels. About 2.96 billion shares changed hands on the New York Stock Exchange. Advancers beat decliners by a 2-to-1 margin. Volume on the Nasdaq was roughly 2.15 billion shares, with winners outpacing losers 9 to 7.

The Federal Open Market Committee decided to keep its federal funds target unchanged at 5.25% for the third straight meeting, an outcome that had been widely anticipated.

"The Fed didn''t do anything out of the ordinary and the statement was balanced," said Art Hogan, chief market analyst with Jefferies. "Everything stays in play. We got what we expected, and the market likes that."

The FOMC said in its policy statement that recent indicators showed "economic growth has slowed over the course of the year, partly reflecting a cooling of the housing market." Looking forward, the Fed said "the economy seems likely to expand at a moderate pace."

To view the latest market video, click here

However, "inflation pressures seem likely to moderate over time, reflecting reduced impetus from energy prices, contained inflation expectations, and the cumulative effects of monetary policy actions and other factors restraining aggregate demand," the statement said.

The FOMC reiterated its views on the possibility of further hikes, and for the third straight time, Richmond Fed President Jeffrey Lacker registered a dissenting vote, saying he preferred a rate increase of 25 basis points.

Following the announcement, the 10-year Treasury bond was up 13/32 in price to yield 4.76%. The dollar fell against the yen and euro.

In other economic news, the National Association of Realtors said existing-home sales fell a greater-than-expected 1.9% to 6.18 million annualized units in September, giving the Fed further evidence regarding the slowdown in the housing market. Economists expected that sales would only fall to 6.25 million annualized units from 6.30 million in the previous month.

"High and rising inventory is killing prices," said Ian Shepherdson, chief economist with High Frequency Economics. "In September, the month''s supply was unchanged, but this is not good news. Supply usually falls in September, so, seasonally adjusted, the inventory picture is getting worse."

Oil prices jumped above $61 a barrel after the Energy Department posted its weekly inventory report. Crude stocks unexpectedly fell by 3.3 million barrels last week. Meanwhile, gasoline inventories dropped by 2.8 million barrels and distillates fell by 1.4 million barrels.

The December crude contract surged $2.05 to close at $61.40 a barrel. Gold futures reversed early weakness and were higher by $3.20 to $590.80 an ounce, and silver was up 4 cents to close at $11.89 an ounce.

As for earnings, GM posted a third-quarter loss of $115 million, or 20 cents a share, compared with a loss of $1.7 billion, or $2.94 a share, in the same quarter a year ago. Revenue rose to $48.8 billion from $47.2 billion a year ago.

Excluding items related to the company''s restructuring, GM said it had adjusted earnings of 93 cents a share, well ahead of the consensus profit estimate of 49 cents. At the same time, the Dow component significantly narrowed the range of its potential liability related to Delphi''s (DPHIQ:) bankruptcy filing. Still, shares of GM finished lower by $1.48, or 4.1%, to $34.71.

Meanwhile, rival Ford (F:NYSE) ended higher by 2.3%, and DaimlerChrysler (DCX:NYSE) rose 4.5% after its quarterly report.

Dow member Boeing (BA:) reported third-quarter earnings of $694 million, or 89 cents a share, down 31% from the year-ago period. Excluding charges, the airplane maker earned $1.11 in the quarter. Revenue rose 19% to $14.74 billion. Shares of Boeing dropped $2.73, or 3.3%, to close at $80.86.

Meanwhile, Altria (MO:NYSE) lifted its profit forecast for 2006, but its earnings for the third-quarter were a bit short of Wall Street''s expectations. For the full year, Altria is projecting earnings from continuing operations of $5.48 to $5.53 a share, up from a previous range of $5.40 to $5.50. On average, analysts are looking for $5.31. Altria gained $2.28, or 2.9%, to $82.10.

After the previous session''s close, Amazon.com was there to support the bull case, beating earnings estimates and offering an optimistic forecast. Shares of the online bookseller surged 12%, up $4.05 to close at $37.68.

Dozens of other companies were on the schedule to post their quarterly results, and among them, RadioShack (RSH:) swung to a loss, while Monster (MNST:) was mainly in line.

Overseas markets were mostly higher, with London''s FTSE 100 adding 0.5% to 6214 and Germany''s Xetra DAX rising 0.3% to 6265. In Asia, Japan''s Nikkei fell 0.5% overnight to 16,699, and Hong Kong''s Hang Seng edged higher by 0.1% to 18,157.

Thursday will bring another busy day of earnings. Reports are expected from Exxon Mobil (XOM:NYSE) , Microsoft (MSFT:Nasdaq) , Bristol-Myers Squibb (BMY:NYSE) and Sun Microsystems (SUNW:Nasdaq) , among others.

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Stocks Perk Up as Oil Drops



Stocks overcame a scare caused by a steep drop in new-home prices and headed higher as crude futures sold off.

The Dow Jones Industrial Average was up 10 points, or 0.1%, to 12,144, having been down nearly 40 points earlier in the session. Among its components, Boeing (BA:NYSE) was losing 2.3%, while Disney (DIS:NYSE) was higher by 2.2%.

The S&P 500 was adding 5 points, or 0.4%, to 1387, having also reversed early losses. The Nasdaq Composite was gaining 16 points, or 0.7%, at 2372.

U.S. equities were having a back-and-forth session following several economic releases. The Commerce Department said that even as new-home sales rose 5.3% in September, the median sales price plummeted 9.7% from August, the biggest drop since 1970.

Economists anticipated no change from the previous month''s 1.05 million new-homes pace. Instead, they got an increase to an annualized rate of 1.075 million. On Wednesday, the National Association of Realtors said existing-home sales fell 1.9% in September.

Ian Shepherdson, chief economist with High Frequency Economics, described the falloff in prices as startling. "Pressure on prices is, therefore, still down, and falling prices deter buyers," he said.

The seesaw movement on the major indices highlights the fickle nature of the market. Just a day before, the Federal Reserve''s decision to again keep rates steady in the absence of overwhelming evidence of inflation helped stocks close slightly higher.


For several months, economic reports that show modest growth, or in some cases outright slowdowns, have been welcomed on Wall Street because they improve the chances the Fed will stop tightening. However, when data have been overly weak, as was the case with housing prices, bulls have gone into hiding.

But as can happen, a slide in oil prices was providing buyers with a reason to move back in.

The December crude contract ended down $1.04, to $60.34 a barrel, reversing the prior session''s rise that put prices above the $61 mark. As for other commodities, gold futures Added $9, to $599.80 an ounce, and silver was up 35 cents at $12.24 an ounce.

Also on the economic docket, the government said durable-goods orders rose a greater-than-expected 7.8% in September. Economists thought orders would rise 2.3% after a revised 0.1% dip in August. Excluding transportation, orders rose 0.1%. The headline number was boosted by a 42% advance in defense capital goods.

Additionally, the Labor Department said initial jobless claims rose by 8,000 to 308,000 last week. The less volatile four-week moving average of claims fell by 2,750 to 305,250.

"There''s competing economic numbers today," said Jay Suskind, head of institutional equity trading with Ryan Beck & Co. "Investors are looking at where the strength of the economy is. There''s a bit of uncertainty about the economy that''s resonating into stocks."

After the economic data were released, the 10-year Treasury was up 12/32 in price to yield 4.72%. The dollar fell against the yen and euro.

Earnings were again arriving at a brisk pace. Sprint (S:NYSE) missed analysts'' third-quarter earnings estimates, but revenue of $10.5 billion was a little better than expected. Sprint was adding $1.16, or 6.6%, to $18.88.

Dow member Exxon Mobil (XOM:NYSE) posted third-quarter earnings of $10.49 billion, or $1.77 a share, up from $9.92 billion, or $1.58 a share, last year. The Thomson First Call average estimate was for a profit of $1.59 a share in the September period. Revenue dipped to $99.59 billion from $100.72 billion a year ago. Exxon was rising by 33 cents, or 0.5%, to $71.34.

Wendy''s (WEN:NYSE) posted third-quarter earnings of $72 million, or 61 cents a share, nearly unchanged from the year-ago results. Revenue rose 2.5% to $623 million from last year. The Thomson First Call average forecast was for earnings of 64 cents. Wendy''s was tacking on 7 cents, or 0.2%, to $35.64.

Cereal maker Kellogg (K:NYSE) posted third-quarter net income of $281.1 million, or 70 cents a share, up 3% from the same quarter last year. Quarterly sales rose to $2.82 billion from $2.62 billion a year ago. Wall Street expected earnings of 65 cents a share on sales of $2.76 billion. Kellogg also raised its full-year guidance, and shares were up 87 cents, or 1.8%, to $50.51.

Bristol-Myers Squibb (BMY:NYSE) said third-quarter earnings dropped to $338 million, or 17 cents a share, down 65% from the year-ago quarter. However, Bristol-Myers reported adjusted earnings of 22 cents a share, beating the consensus for EPS of 20 cents. The stock was recently up 9 cents, or 0.4%, at $24.75.

Insurance giant Aetna (AET:NYSE) topped third-quarter consensus earnings expectations and raised its 2007 guidance, while Dow Chemical (DOW:NYSE) exceeded estimates and disclosed plans for a $2 billion stock buyback.

Following the close of trading, software standard-bearer Microsoft (MSFT:Nasdaq) will post its quarterly results.

European markets were mixed, with London''s FTSE 100 losing 0.5% to 6185 and Germany''s Xetra DAX rising 0.3% to 6284. In Asia, Japan''s Nikkei rose 0.7% overnight to 16,812, and Hong Kong''s Hang Seng jumped 1.1% to 18.353.

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The Chart.....

Technicals
Record Price High

Last Price Quote is:
1.45%above 13-day MA
4.13%above 50-day MA

[setravis]

Merger Frenzy Lifts Market




U.S. markets started the week on a high note Monday as traders used a spurt in dealmaking to put the sluggishness of recent sessions behind them.

The Dow Jones Industrial Average advanced 119.51 points, or 1%, to 12,105.55, and the S&P 500 was up 15.48 points, or 1.1%, to 1379.78. The Nasdaq Composite gained 35.16 points, or 1.5%, to 2365.95.

Most sectors were in the green, led by a 4.2% gain in the Dow Jones U.S. Trucking index. The Amex Airline index was up 2.8%, and the Philadelphia Semiconductor Sector index was higher by 1.8%. Gold and silver indices sat out the rally and declined about 1.2%.

As a new week unfolded, a spate of mergers brought in buyers. Among the tie-ups, Four Seasons (FS:) received a $3 billion takeover offer from a group that includes controlling shareholder Isadore Sharp, Microsoft (MSFT:) founder Bill Gates and Saudi Arabia''s Prince Alwaleed.

Four Seasons was up 29.2% to $82.50, easily setting a 52-week high.

Another acquisition will see Abbott Labs (ABT:NYSE) buy Kos Pharmaceuticals (KOSP:Nasdaq) for $78 a share in a $3.7 billion deal.

Kos surged 53.8% to $77.06, but Abbott ticked down 0.4% to $47.47.

Wall Street struggled last week amid a string of economic data that traders found unfriendly for stocks. On Friday, the Dow closed down 32.5 points to 11,986.04 -- its sixth straight decline and its first time ending below 12,000 since Oct. 18. For the week, the Dow lost 104 points, the S&P 500 shed 13 points, and the Nasdaq gave back 20 points. On a percentage basis, each index surrendered 0.9%.


But with mergers dominating the headlines, investors decided it was a good day to buy. OSI Restaurants (OSI:NYSE) , the owner of Outback Steakhouse, will be acquired by an investor group made up of its founders, Bain Capital Partners and others for $40 a share, and Swift Transportation (SWFT:Nasdaq) got a $29-a-share bid from former chairman Jerry Moyes, the company''s largest shareholder.

OSI climbed 22.6% to $39.75.

Elsewhere, buyout firm Kohlberg Kravis Roberts recently approached Vivendi about possibly acquiring the French media company, but talks have now ended.

Outside of the M&A arena, earnings, continued coming in, although the pace has slowed considerably. XM Satellite Radio (XMSR:Nasdaq) and Marvel Enterprises (MVL:NYSE) beat analysts'' estimates, while Northeast Utilities (NU:NYSE) affirmed its expectations.

XM was up 15.6%, and Marvel gained 5.8%.

Treasury prices edged higher, with the 10-year note rising 3/32 in price to yield 4.70%. The dollar was mixed against other major currencies, and December crude futures rose 88 cents to $60.02 a barrel.

Overseas, stocks were higher across Europe. Asia was mixed. Equities were weak in Japan and Korea but stronger in Hong Kong and mainland China.

[setravis]

Bulls Win the Race..............



Stocks closed higher again Tuesday as the midterm elections and the possibility of a power change in Congress didn''t deter buyers.

The Dow Jones Industrial Average was up 51.22 points, or 0.42%, to 12,156.77, taking its two-day gain to 170 points following six straight declines. Nineteen of the Dow''s 30 components were in positive territory, led by a rise of 5.4% in Boeing (BA:) .

The S&P 500 was higher by 3.06 points, or 0.22%, to 1382.84, and the Nasdaq Composite added 9.93 points, or 0.42%, to 2375.88, boosted by gains of at least 4.8% in Altera (ALTR:) and Broadcom (BRCM:) .

"The market''s rise isn''t reflective of the election," said Barry Hyman, equity market strategist with EKN Financial. "The money just continues to pour into the equity market. There is a presumption that the earnings base of the market is still intact. I''m seeing some performance-chasing here, as well. It''s good to see the six consecutive down days on the Dow didn''t do any real damage."

About 2.73 billion shares changed hands on the New York Stock Exchange, and volume on the Nasdaq was roughly 2.14 billion shares. Winners narrowly outpaced losers.

By sector, semiconductor stocks were the big winners of the session. The Philadelphia Semiconductor Sector index rose 1.9%. Housing stocks were among the hardest hit, with the Philadelphia Housing Sector index losing 0.7%.

With earnings winding down and the economic calendar bare, the focus of the new session was on the polls. Voters will be casting ballots on all 435 members of the House of Representatives, one-third of the Senate and numerous governors and local officials.


Political pundits have for some time been predicting the Democrats would reclaim the House from Republican control for the first time since 1994 amid voter anger over the war in Iraq. However, in recent days, the GOP has been performing better in polls ahead of the election. The Senate is generally expected to remain in Republican hands.

On the corporate side, luxury-home builder Toll Brothers (TOL:) cut its 2007 forecast again, saying it now expects to deliver 6,300 to 7,300 houses next year. The company said fourth-quarter revenue dropped 10% from last year to $1.81 billion and was just short of the consensus estimate. Toll Brothers ended the session down by a penny at $28.04.

At Beazer Homes (BZH:) , fourth-quarter earnings were better than expected but the company cautioned that housing market fundamentals remain difficult. For the most recent quarter, Beazer earned $92 million, or $2.19 a share, down from $164 million, or $3.61 a share, a year ago. Revenue rose to $1.88 billion from $1.81 billion a year earlier. Beazer tacked on 13 cents, or 0.3%, to $42.07.

Nortel (NT:) posted a third-quarter loss of $99 million, or 2 cents a share, falling short of estimates. Nortel''s board also approved a reverse 1-for-10 stock split of its common shares, effective Dec. 1. Nortel fell by 26 cents, or 10.9%, to $2.13.

Sara Lee (SLE:) posted fiscal first-quarter earnings of $333 million, or 44 cents a share, up from $67 million, or 9 cents, a year ago. Earnings from continuing operations came to 34 cents a share, ahead of the Thomson First Call consensus of 25 cents a share. Shares gained 5 cents, or 0.3%, to $16.29.

Following the previous close, tax preparer H&R Block (HRB:) reduced its full-year profit forecast and said it hired Goldman Sachs to find a buyer for its Option One Mortgage unit. Block said Option One will close 12 branch offices in the next four months.

The company said it expects to make between $1.20 and $1.45 a share for the year ending April 30, down from the previous guidance for $1.60 to $1.85. H&R Block rose $1.39, or 6.4%, to $23.28.

Among analyst moves, Banc of America Securities downgraded Microsoft (MSFT:) to neutral from buy, citing the belief that earnings won''t begin outperforming expectations until 2008, rather than 2007. Still, Microsoft finished higher by 11 cents, or 0.4%, to $28.95.

Elsewhere, the benchmark 10-year note was up 10/32 in price to yield 4.66%. The dollar was slumping against the world''s other major currencies. Gold futures finished lower by 20 cents at $627.70, and crude oil futures dropped $1.09 to close at $58.93 a barrel.

Overseas, Europe''s equities moved higher. London''s FTSE 100 was up 0.3% to 6244, and Frankfurt''s Xetra DAX was rising by 0.5% to 6362. Asia''s shares also showed strength, after the Nikkei finished up 0.2% at 16,393.

[setravis]

Stocks Conquer Election Angst



Wall Street overcame morning selling pressure and closed to the upside Wednesday as traders shook off fears about the power shift in Congress.

The Dow Jones Industrial Average rose to another all-time high, gaining 19.77 points, or 0.16%, to 12,176.54, after falling as many as 53 points earlier. The index, which beat the previous record close set on Oct. 26, was supported by gains of 1.3% in Altria (MO:) and Exxon Mobil (XOM:) .

As for the other indices, the S&P 500 was up 2.88 points, or 0.21%, at 1385.72, and the Nasdaq Composite advanced 9.06 points, or 0.38%, to 2384.94.

"The reversal is pretty impressive," said Jay Suskind, head of institutional equity trading with Ryan Beck & Co. "With the sense that maybe all that much won''t change, the market has an optimistic viewpoint for the next few months. We''ve now had a good couple of days, but we need some more guidance from the political standpoint."

About 2.88 billion shares changed hands on the New York Stock Exchange, and advancers beat decliners by a 5-to-3 margin. Volume on the Nasdaq was roughly 2.12 billion shares, with winners outpacing losers 3 to 2.

The market initially saw weakness a day after Democrats easily won control of the House of Representatives for the first time in 12 years, picking up at least 26 seats against Republicans in Tuesday''s midterm elections. Only 15 were needed for the Democrats to take a 218-seat majority.


In the Senate, a close race in Montana was determined by midday to have been won by the Democratic challenger, meaning five slots have transferred from the GOP to Democratic hands. A race in Virginia, which remains the deciding factor in the balance of power, is still too close to call.

With earnings winding down and the economic calendar bare, the focus of the trading session was on the election results.

"Investment implications have been bandied about. However, in the long run, the economy wins out, and on that score we continue to look rather slow," said Paul Nolte, director of investments with Hinsdale Associates. "If not for a robust employment report, investors would be fretting about recession."

In addition to the Congressional moves, there also will be a change at the Pentagon. Defense Secretary Donald Rumsfeld will resign from his position, President Bush said. Former CIA chief Robert Gates will take Rumsfeld''s place.

By sector, oil stocks were the big winners of the session. The Philadelphia Oil Service Sector Index finished higher by 2.2%, and the Amex Oil Index gained 1.4%. Airline stocks were among the hardest hit, with the Amex Airline Index losing 1.5%.

Before trading got underway, several earnings reports rolled in. Sirius Satellite Radio (SIRI:) narrowed its quarterly loss, and Barr Pharmaceuticals (BRL:) had strong profits, but sales were a little light. Sirius closed higher by 0.7% to $4.12, while Barr lost 3.6% to $49.79.

Among analyst moves, JPMorgan Chase upgraded Whole Foods Market (WFMI:) to overweight from neutral, boosting shares by 3.3% to $49.04. Through the previous five sessions, shares of Whole Foods had dropped 25.6% amid worries about its growth prospects.

Wachovia downgraded homebuilder Toll Brothers (TOL:) to market perform from outperform, and Lehman Brothers cut Pulte Homes (PHM:) to equal-weight from overweight. Toll Brothers slumped by 1.9% to $27.50, and Pulte fell by 3.4% to close at $28.94.

Away from equities, the benchmark 10-year Treasury note was up 7/32 in price to yield 4.63%. The dollar was slumping against the world''s other major currencies. Gold futures were down $9.40 to close at $618.30.

Elsewhere, the Energy Department released its latest data on weekly crude inventories. Oil stocks were up by 400,000 barrels. Gasoline stores were down by 600,000 barrels and distillate inventories dropped by 2.7 million barrels. Following the number, crude futures closed up 90 cents at $59.83 a barrel, nearly reversing the entire decline from the prior day.

Overseas, European markets were lower. London''s FTSE 100 was down 0.1% to 6239, and Frankfurt''s Xetra DAX was off 0.2% to 6349. Asia''s markets also showed weakness. The Nikkei dropped 1.1% at 16,216, and the Hang Seng fell 0.7% to 18,811.

On Thursday, earnings reports are expected from Disney (DIS:) , JCPenney (JCP:) , Kohl''s (KSS:) , Nvidia (NVDA:) and Viacom (VIA:) .

[setravis]

Dow Runs to New Record.......



Stocks enjoyed a solidly higher session Wednesday, albeit amid somewhat light trading action, and the Dow Jones Industrial Average surged to a new record close.

The Dow was strong all day and finished ahead by 102.94 points, or 0.8%, at 12,510.57, driven by gains of more than 2% in Alcoa (AA:NYSE) , Citigroup (C:NYSE) and General Motors (GM:NYSE) .

Also picking up ground were the S&P 500, rising 9.94 points, or 0.7%, to 1426.84, and the Nasdaq Composite, which collected 17.71 points, or 0.7%, to 2431.22.

Only one of the 30 industrials, United Technologies (UTX:NYSE) , faltered.

U.S. stocks began the holiday-shortened week in an upbeat manner Tuesday, as the major averages advanced throughout the session and closed higher. The Dow rose 64.41 points to 12,407.63, and the S&P 500 climbed 6.14 points to 1416.90. The Nasdaq tacked on 12.33 points to 2413.51.

For both the New York Stock Exchange and the Nasdaq, the past two days have been marked by fairly low volume. About 1.50 billion shares changed hands on the NYSE, and 1.26 billion shares traded on the Nasdaq. Winners beat losers roughly 7 to 3.

Two days remain in 2006 for Wall Street. However, though the NYSE hasn''t announced its plans, trading could potentially be canceled one day this week because of the death of former President Gerald Ford.

The 38th U.S. president died at the age of 93, and the Big Board has a tradition of closing on the nationally recognized day of mourning following the passing of a president.

Turning to the economy, the government said new homes were sold at an annual rate of 1.047 million in November, up a bit from the pace of right at 1 million in October. The pickup in housing sales was better than the 1.02 million rate analysts had expected.

Energy prices were generally lower. A day after falling 2%, crude oil futures were down another 76 cents to $60.34 a barrel. Precious metals were higher, led by a gain of $3.40 in the price of gold to $630.30 an ounce.

Treasuries were sinking. The 10-year note was dropping 13/32 in price and yielding 4.65%, and the 30-year bond was down 23/32 and yielding 4.78%.

[setravis]

Big Year Ends With a Fizzle.......



Stocks closed the last trading day of 2006 near their session lows, but the modest selling pressure couldn't put a dent in what has been a very successful year overall for the bulls.

The Dow Jones Industrial Average ended Friday at 12,463.15, down 38.37 points, or 0.31%. The S&P 500 was down 6.43 points, or 0.45%, at 1418.30, and the Nasdaq Composite gave up 10.28 points, or 0.42%, to 2415.29.

Only seven of the Dow's 30 components escaped losses. JP Morgan Chase (JPM:) was the biggest decliner, finishing down 1.3%. Intel (INTC:) , the average's biggest loser this year with an 18% drop, was down 0.8% to $20.25.

The major indices started this holiday-shortened week on a high note, surging the first two sessions before edging lower on Wednesday.

During the previous day, the Dow slipped 9.05 points, or 0.07%, to 12,501.52. The S&P 500 lost 2.11 points, or 0.15%, to 1424.73, and the Nasdaq was off 5.65 points, or 0.23%, at 2425.57.

All told, the Dow jumped 120 points during the week, and the S&P 500 was higher by 7 points. The Nasdaq rose about 14 points. Volume was light to end the week, with 1.68 billion shares changing hands on the New York Stock Exchange. Decliners beat advancers by a 5-to-3 margin. Volume on the Nasdaq reached nearly 1.42 billion shares, with losers beating winners 3 to 2.

Traders can look back on this year as a successful one, as the Dow surged 16.3% and the S&P 500 advanced more than 13.6%. The Nasdaq was higher by 9.5% for the year.

As the session wrapped up, New York trading won't get under way again until next Wednesday. The market will be closed Monday for the New Year's holiday and Tuesday for the funeral of former President Gerald Ford.

By shutting Jan. 2, the Nasdaq and the NYSE will both be closed for four consecutive days for the first time since the terrorist attacks of Sept. 11, 2001.

On the corporate side, Apple (AAPL:) remained in the news. The company filed its delayed quarterly report and admitted to falsifying documents on its stock options, but it said that none of its current executives knew about the issue and that CEO Steve Jobs didn't benefit financially.

Shares of Apple rose 4.9% to finish at $84.84. For the year, the stock gained roughly 18%.

Elsewhere, Delta (DALRQ:) reported a narrower loss for November than it had in the same month a year ago, and Marsh & McClennan (MMC:) is planning to unload its Putnam Investments unit for $3.9 billion, according to a published report.

Meanwhile, phone giant AT&T (T:) has offered regulators new concessions in a bid to get its merger with regional carrier BellSouth (BLS:) approved before the year ends. The deal is now valued around $85 billion.

Shares of AT&T added 25 cents, or 0.7%, to $35.75. BellSouth gained 31 cents, or 0.7%, to close at $47.11.

In the absence of any major economic release, Treasuries ticked lower. The benchmark 10-year lost 4/32 in price to yield 4.70% and the 30-year eased by 1/32, yielding 4.81%. The dollar was mixed against the world's major currencies.

Crude futures were higher in Nymex floor trading, extending the previous session's gain. The February contract added 52 cents to close at $61.05 a barrel. Gold rose $1.10 to $638 an ounce, while silver was off by a half-cent to $12.93 an ounce.

Overseas, the Tokyo Nikkei was unchanged at 17,225, and Hong Kong's Hang Seng was lower by 0.2% at 19,965. London's FTSE was down 0.3% at 6220, and Frankfurt's Xetra DAX eased 0.2% at 6596.

[setravis]

Apple Inspires Wall Street.......


Stocks steadied themselves after taking a tumble at the open, and by the end of trading Wednesday the major indices had finished with modest gains.

The Dow Jones Industrial Average rose 25.56 points, or 0.21%, to 12,442.16, and the S&P 500 was up 2.74 points, or 0.19%, at 1414.85. The Nasdaq gained 15.50 points, or 0.63%, at 2459.33.

A 4.8% rise in Apple (AAPL:Nasdaq) , which continued to hit record highs a day after CEO Steve Jobs unveiled an all-in-one phone and iPod device, supported the Nasdaq''s advance. Apple jumped $4.43 to $97.

Volume remained strong, with 2.68 billion shares changing hands at the New York Stock Exchange. On the Nasdaq, nearly 2.29 billion shares traded. Losers matched winners.

New York stocks have had rocky sessions all week. On Tuesday, the action in the oil market flummoxed investors, and the first corporate earnings began to appear. At the end of it all, the Dow had slipped 6.89 points, or 0.06%, to 12,416.60, and the Nasdaq had gained 5.63 points, or 0.23%, to 2443.83.

During the prior day, crude plunged more than $2 a barrel at one point before recovering most of the loss. Sellers were back again, though, and the February contract dropped $1.62 to close at $54.02 a barrel.

According to the Energy Department''s weekly inventory report, crude stores fell by a greater-than-expected 5 million barrels last week. However, the drawdown wasn''t giving prices any support, as distillate supplies climbed by 5.4 million barrels and gasoline stocks rose 3.8 million barrels.

"The $55 level was broadly seen as key technical support," said Marc Pado, U.S. market strategist with Cantor Fitzgerald. "The warm-weather forecasts are certainly a part of the bearish pressure on crude, but there is more to it. Even with cold on the way, inventories are likely to stay strong through winter."

Lower oil prices have mixed effects. While good for consumers, which can help lift the overall stock market, falling crude tends to put pressure on shares of companies in the energy complex. That can lead the equities market lower.

Along with crude, most other energy contracts were weaker, as were precious metals. Gold futures eased $1.60 to close at $613.40 an ounce, and silver fell 15 cents to finish at $12.44 an ounce.

The Amex Oil Index lost 1.7%, and the Philadelphia Oil Service Sector Index dropped 1.3%. Meanwhile, chip stocks were again among the winners of the session, with the Philadelphia Semiconductor Sector Index adding 1.8%.

The market also wrestled with comments from Chicago Federal Reserve President Michael Moskow, who provided his economic outlook at a business luncheon in Iowa.

"My predominant concern remains the risks to the inflation outlook," said Moskow. "We''ve seen some welcome easing in inflation in the past couple of months, and I''m hopeful this development will continue. But there is still the risk that resource pressures or other factors, such as elevated inflation expectations, could prevent actual inflation from falling in a timely fashion."

On the corporate side, US Airways (LCC:) raised its bid for bankrupt airline Delta (DALRQ:) to $10.6 billion from around $8 billion. Delta has thus far said it wants to remain independent, but US Air has repeatedly indicated it planned to continue pursuing the offer.

Delta rose 10 cents, or 7.7%, to $1.40. US Airways finished higher by $1.03, or 1.8%, to $58.93.

Elsewhere, Chevron (CVX:) said fourth-quarter earnings would be hurt by lower commodity prices and reduced downstream margins. Chevron gave back $1.22, or 1.7%, to $69.41.

Staying with earnings, Alcoa (AA:) reported after the previous close, saying its profits and revenue for the fourth quarter topped analysts'' estimates. Alcoa jumped $1.71, or 6%, to $30.23 and was the Dow''s best performer. Genentech (DNA:NYSE) slipped 95 cents, or 1.1%, to close at $83.74 ahead of its quarterly results.

Shares of Guitar Center (GTRC:) slid 1.6% after the retailer said fourth-quarter income will miss its previously projected range of $1.14 to $1.20 a share. The Thomson First Call analysts'' consensus is for earnings of $1.16 a share. Guitar Center blamed the shortfall on weaker-than-expected sales. The stock ended down 67 cents to $42.58.

Sears Holdings (SHLD:Nasdaq) said it expects to make $4.87 to $5.39 a share for the fourth quarter ending this month, up from $4.03 a year ago. Analysts were looking for $4.86. Shares gained $5.86, or 3.5%, to $172.09.

Away from equities, the Commerce Department said the U.S. trade deficit narrowed to $58.2 billion in November, the lowest level since July 2005, from $58.9 billion in October. Economists expected the deficit to widen to $59.8 billion.

Treasuries eased following the data. The 10-year fell by 5/32, yielding 4.68%. The 30-year bond slipped 15/32 to lift the yield to 4.77%. The dollar was rallying against other major currencies.

Overnight in Asia, Japan''s Nikkei fell 1.7% to 16,942, and Hong Kong''s Hang Seng sank 1.7% to 19,568. In Europe, London''s FTSE 100 slid 0.6% to 6161. Germany''s Xetra DAX was off 0.7% to 6566.