Dow Storms to New High

The index surges past 12,900. The Nasdaq is also higher.
Author:
Publish date:

Updated from 4:19 p.m. EDT

The New York market bounced Friday, led by a 1.2% surge in the

Dow Jones Industrial Average

, which closed at a record high for the third straight session.

After two days of minor advances, the Dow caught a bid and jumped 153.35 points to 12,961.98. Overall, the index recorded its seventh consecutive gain, and just two of its stocks declined.

Elsewhere, the

S&P 500

was up 13.62 points, or 0.93%, at 1484.35, and the

Nasdaq

added 21.04 points, or 0.84%, to 2526.39.

Upbeat profit news, especially from Internet search provider

Google

(GOOG) - Get Report

, had the bulls in charge from early on.

"We've had incredible earnings that have blown away targets, which is definitely driving the market," said Paul Mendelsohn, chief investment strategist with Windham Financial. "Expectations were so low and results are coming in so much higher. So far, the internals look pretty good. This is the first day all the sectors have really kicked in."

Among subsector indices, the Philadelphia Housing Sector Index added 2.1%, the Amex Gold Bugs Index gained 1.2%, and the S&P Retail Index climbed 1.1%. On the losing side, the Amex Airline Index tumbled 1.5%.

For the week, stocks rose. The Dow added 2.8%, the S&P 500 was up 2.1%, and the Nasdaq climbed 1.4%.

About 3.16 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 2.11 billion shares, with winners outpacing losers 2 to 1. That broke a three-day streak where more stocks fell than climbed.

"With the market breadth lagging the last three days, the question now is if the headwinds will still hit us," said Larry Wachtel, senior market analyst with Wachovia Securities. "It's hard for me to believe we're going to continue going up and up in this overbought condition."

Even so, Google provided the market with plenty of momentum. After the previous session's close, the company said it had first-quarter earnings, before items, of $3.68 a share on revenue of $2.53 billion. Both the figures were much stronger than analysts had been forecasting.

Shares of Google climbed $10.83, or 2.3%, to finish the day at $482.48.

Not nearly as fortunate was chipmaker

AMD

(AMD) - Get Report

, whose quarterly loss was well off the mark. However, the company gave investors a bit of a good news after saying it wouldn't necessarily be opposed to a private equity deal if the right transaction came along. AMD shed 12 cents, or 0.8%, to $14.16.

As for the new day's reports,

Caterpillar

(CAT) - Get Report

beat earnings targets and raised its guidance for the full year, noting strength in overseas economic conditions. The news sent the construction giant's shares surging 4.7% to $71.82, making it one the Dow's best performers.

Fellow Dow component

Pfizer

(PFE) - Get Report

posted earnings that were better than expected, but the drugmaker took down its full-year forecast for profits, the low end of which would be more than 10 cents short of what Wall Street wanted to see. Pfizer finished lower by 10 cents, or 0.4%, at $26.97.

Meanwhile,

Honeywell

(HON) - Get Report

handily topped estimates, while another Dow member,

McDonald's

(MCD) - Get Report

, matched the first-quarter earnings target.

Honeywell rose 4.8% to $51.40. McDonald's joined Pfizer as the only other Dow decliner, finishing down 0.9% at $48.36.

American Express

(AXP) - Get Report

said after the prior close that profits rose 21% from the previous year and beat the Thomson First Call consensus. American Express climbed $2.05, or 3.5%, to $61.

Oil-services concern

Schlumberger

(SLB) - Get Report

had earnings and revenue that exceeded analysts' estimates, while software maker

SAP

(SAP) - Get Report

had operating income and total sales that were a bit shy of consensus targets. Schlumberger was higher by 1.2% at $75.23, and SAP added 2.5% to close at $50.39.

Away from earnings,

H&R Block

(HRB) - Get Report

set plans to sell its Option One mortgage business to a Cerberus Capital affiliate in a roughly $1 billion deal. Shares of H&R Block rose 73 cents, or 3.3%, to $22.56.

Turning to the bond market, Treasuries lost ground in the absence of any economic data. The 10-year note was down 1/32 in price, yielding 4.67%, and the 30-year bond was falling 6/32, yielding 4.85%.

As for commodities, the May crude oil contract, trading for the last time, added $1.55 to close at $63.38 a barrel. Gold gained $7.50 to $695.80 an ounce, and silver was higher by 22 cents to $13.96 an ounce.

Overseas, markets were stronger in Asia and in Europe. Tokyo's Nikkei added 0.5% to 17,452, and Hong Kong's Hang Seng climbed 1.3% to 20,566. London's FTSE rose 0.7% to 6486, and Frankfurt's Xetra DAX jumped 1.4% to 7342.