NEW YORK ( TheStreet) - Stocks rallied Friday as the Dow Jones Industrial Average finished close to 200 points higher and the major U.S. equity indices nabbed weekly gains of more than 2%.
Promising durable goods data and technical momentum helped spur the buying spree.
The Dow Jones Industrial Average added 198 points, or 1.9%, to 10,860, marking a weekly rise of 2.4%. Roughly flat for the week headed into Friday's session, the S&P 500 gained 24 points, or 2.1%, to 1,149. Meanwhile, the Nasdaq finished the week 2.8% higher, closing up by 54 points, or 2.3%, at 2,381 on Friday.
Ralph Fogel, head of investment strategy at Fogel Neale Partners, sees a combination of technical and fundamental reasons behind why the market is paying more attention to the good news than bad news. "Technically, the market has had a head-and-shoulder bottom so we've been waiting for the market to break out and it did," Fogel said. "It pulled back a little bit but then bounced back - even disappointing jobless claims didn't cave the market. The S&P 500 remained above 1130. From a technical standpoint, that's pretty powerful. So all it took was some good news today -- with durable goods orders that were a little bit of a surprise -- for the market to take off. So the technical underpinnings are there." "On a fundamental basis," he added, "I think people are starting to wake up to the fact that they can get 2% and change from 10-Year Treasury bonds or they can buy Johnson & Johnson (JNJ) and get a 3.5% yield with the potential for upside." Earlier, the Commerce Department said durable goods orders declined 1.3% in August after rising 0.7% in the previous month. The decline was slightly lower than the 1.4% drop anticipated by economists, according to Briefing.com. Excluding transportation, orders grew 2% after slumping 3.7% in July. Analysts were expecting only a 0.5% bump. On the Dow, Caterpillar (CAT), Alcoa (AA) and Boeing (BA) put in the best performance while AT&T (T), Johnson & Johnson (JNJ) and Bank of America (BAC) had the mildest gains.
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