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Bulls Go Wire to Wire

Robert Holmes

U.S. stocks jumped Tuesday as a pullback in oil prices and an upbeat report on the housing sector awakened buyers.

The Dow Jones Industrial Average surged 128 points, or 1.03%, to 12,510.30, putting the blue-chip index back in to positive territory for the year. Twenty-nine of the Dow's 30 components finished the day in the black, led by Altria's (MO Quote) 2.1% climb.

The S&P 500 gained 13.22 points, or 0.93%, to 1437.77, and the Nasdaq Composite rose 28.07 points, or 1.16%, to 2450.33.

"The fears of a recession abated today, and that certainly gave us a good bid," said Jay Suskind, head of institutional equity trading with Ryan Beck & Co. "There was a lot of relief from the consumer side, in that things may not be as bad as they have seemed. It wasn't a volatile session, and we were up big all day, which is good to see."

About 2.75 billion shares changed hands on the New York Stock Exchange, with advancers beating decliners by a 3-to-1 margin. Volume on the Nasdaq reached 1.96 billion shares, with winners outpacing decliners 2 to 1.

Helping the market's mood was a drop of $1.30 in oil futures to $64.64 a barrel. Most other commodities fell, as well, including a decline of 24 cents in the price of natural gas to $7.43 per million British thermal units.

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

Crude was weaker as tensions appeared to be easing between London and Tehran over the 15 British sailors and marines who are being held captive in Iran. Ali Larijani, Iran's top international negotiator, suggested his nation hold discussions with Britain to resolve the situation peacefully.

Iran nabbed the service members March 23 while they were searching vessels in the Persian Gulf. Concerns about a possible military confrontation or a decline in Middle East petroleum shipments supported a sizable run-up in oil last week.

Meanwhile, a report from the National Association of Realtors also raised Wall Street's spirits. The group said the index tracking pending U.S. home sales rose 0.7% to 109.3 in February from 108.5 in January.

Treasury prices were lower. The 10-year note was down 5/32, yielding 4.66%, and the 30-year bond was off 6/32 in price to yield 4.85%.

On Monday, stocks in New York posted minor gains following another back-and-forth session. For the day, the Dow rose 27.95 points, or 0.23%, to 12,382.30. The S&P 500 added 3.69 points, or 0.26%, at 1424.55, and the Nasdaq ticked up 0.62 points, or 0.03%, to 2422.26.

"The second quarter kicked off with the kind of resilience we saw late last year," said Marc Pado, U.S. market strategist with Cantor Fitzgerald. "Investors are starting to set themselves up for a long holiday weekend, one with important economic news out with the markets closed on Friday."

Investors can trade for only four days this week because of the Good Friday holiday April 6. Trading will resume April 9, a day before Dow component Alcoa (AA Quote) unofficially kicks off the first-quarter earnings reporting season.

As for equities, U.S. automakers were in focus after posting car and truck sales for March. Ford (F Quote) said sales dropped 9% last month, while DaimlerChrysler (DCX Quote) reported a 4% decline in sales during March. Shares of Ford dipped 0.1% to $8.08, and DaimlerChrysler fell 1.3% to $82.95.

General Motors (GM Quote) said March sales fell 7.7% on a day-rate selling day basis to 349,867 vehicles. GM closed higher by 64 cents, or 2.1%, to $31.47.

Following the prior close, Accredited Home Lenders (LEND Quote) said it has opened a $500 million credit line with a large commercial bank. The subprime mortgage lender also said it renewed a $600 million borrowing arrangement with an investment bank. Accredited gained $1.56, or 18.4%, to finish at $10.04.

Accredited's news came on the same day that embattled rival New Century Financial (NEWC Quote) filed for Chapter 11 bankruptcy protection. New Century also laid off about 3,200 employees. Shares added 10 cents, or 10.4%, to $1.01.

Internet auction site eBay (EBAY Quote) finished higher after Bear Stearns raised its first-quarter earnings and revenue targets for the company, citing better conversion rates and higher average selling prices. The stock ended the day up 80 cents, or 2.4%, at $33.80.

Among other analyst actions, Prudential upgraded Tribune Co. to neutral from underweight, while also raising the stock price target to $34 from $27. Elsewhere, Wachovia initiated coverage of Nymex Holdings (NMX Quote) with an outperform rating.

Tribune was off 13 cents, or 0.4%, to $32.68, a day after rising 2.2% on news that the company's board has accepted Sam Zell's buyout offer. Nymex lost $1.18, or 0.9%, at $131.79.

Global stocks collected gains. Tokyo's Nikkei 225 climbed 1.3% overnight to 17,244, and Hong Kong's Hang Seng jumped 1% to 20,003. The U.K.'s FTSE 100 and the Paris Cac 40 advanced 0.8%, and Frankfurt's Xetra DAX climbed 1.6% to 7045.