NEW YORK (
) -- The
Dow
rallied to a triple-digit gain Tuesday as strong earnings and economic data, coupled with the
euro's gains against the dollar
, helped an array of equities and commodity prices.
The Dow Jones Industrial Average finished higher by 170 points, or 1.7%, to 10,269. The
S&P 500
gained 19 points, or 1.8%, to 1095, and the
Nasdaq
advanced by 31 points, or 1.4%, to 2214.
Eurozone countries are giving Greece a month to show improvement in its high debt levels before demanding that the country enact deep spending cuts and tax increases.
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"We have heard it said frequently by those inclined to be bearish on any support package that Greece doesn't have a liquidity problem, it has a solvency problem. At this time a year ago we remember the same characterization being made of the U.S. banking system," says Barclays Capital analyst Barry Knapp, adding that there are numerous examples of "technically insolvent" companies or countries that have been struggling for a while without triggering systematic market disruptions.
"The European sovereign debt crisis looks similar to us, given our belief that the EU is capable of mitigating the risk of a liquidity crisis," Knapp said. "Although the EU statement was vague and the more you look at Greek finances the worse they look, there are enough options for the EU, including front end-loading the funds earmarked for Greece from the EU in coming years, IMF validation and monitoring of conditions placed by the EU on Greece, and independent European Central Bank purchases of Greek debt."
A weaker U.S. dollar, which slipped against a basket of currencies and was trading down by 0.9%, according to the dollar index, lifted commodity prices and related shares.
In commodities markets, crude oil for March delivery settled $2.88 higher at $77.01 a barrel, while the most actively traded April
gold
contract surged $29.80 to settle at $1,119.80 an ounce.
Chevron
(CVX) - Get Report
was one of several Dow performers advancing more than 2% today, with shares up 2.8%. The NYSE Arca Oil Index rose 2.7%, and the Philadelphia Oil Service Sector Index gained 2%.
Alcoa
(AA) - Get Report
jumped 3.5%.
Other stocks in the basic materials sector making impressive gains included
Stillwater Mining
(SWC)
, which added 6.7%, and
North American Palladium
(PAL)
, which gained 9%. Shares of
Freeport McMoRan Copper & Gold
(FCX) - Get Report
added $2.26, or 3.1%, to $75.94, and
AK Steel
(AKS) - Get Report
rose 6.4% on news that it would raise spot market prices in response to increased demand.
Shares of
Terra Industries
( TRA) gained $7.44, or 22.4%, to $40.69 on news that it would be acquired by
Yara International
in a $4.1 billion deal.
Volume on the Dow approached nearly 235 million compared to an average daily volume of about 200 million.
Citigroup
(C) - Get Report
,
Bank of America
(BAC) - Get Report
and Terra Industries served as volume leaders on the
New York Stock Exchange
, as listed volume came close to 4.1 billion.
Financials also rallied broadly. Shares of Bank of America led the blue-chip average higher, surging 4.9% on reports of dipping credit delinquencies and loan modification gains. The KBW Bank Index rose 2.9%.
Also contributing to market optimism, the
Empire State Manufacturing Index
surged to 24.9 in February, compared with 15.92 in January. Economists had been expecting a reading of 18, according to consensus estimates.
A separate reading on homebuilder confidence also showed improvement this month. The National Association of Home Builders said its Housing Market Index rose two points to register 17 in February.
Simon Property Group
(SPG) - Get Report
offered to buy
General Growth Properties
(GGWPQ)
for more than $10 billion.
JPMorgan Chase
(JPM) - Get Report
will buy the global oil, global metals and European power and gas assets of
RBS Sempra Commodities
for $1.7 billion.
In earnings news,
Merck
(MRK) - Get Report
met analysts' earnings estimates and said it will cut its workforce by 15% by the end of 2012 as part of a new restructuring plan.
Barclays
(BCS) - Get Report
reported that 2009 profits more than doubled.
Kraft's
( KFT) fourth-quarter earnings exceeded expectations and said it continues to aim for the high end of its long-term earnings-growth target. Despite that, Kraft's shares showed some of the biggest weakness on the Dow, down 0.4%.
Qwest
(Q)
disappointed with lower-than-expected fourth-quarter earnings but said it expects improving sales comparisons throughout the course of the year.
Abercrombie & Fitch's
(ANF) - Get Report
fourth-quarter profit fell 31% at
as the retailer was hit by charges related to closing its Ruehl chain.
After the closing bell,
Whole Foods
( WFMI) moved 5% higher in extended trading after beating profit forecasts and raising its 2010 outlook.
The benchmark 10-year Treasury note strengthened 8/32, pressuring the yield down to 3.665%.
Elsewhere, a bomb exploded outside JPMorgan Chase's Athens office, though no injuries were reported, according to
The Associated Press.
Toyota
(TM) - Get Report
slid another 1.4%, the same day the National Highway Traffic Safety Administration said it is
ramping up its inquiry into the timeliness of Toyota's recent recalls.
Reflecting his call during the State of the Union address to advance nuclear energy, President Obama announced $8.3 billion in loan guarantees to build two nuclear reactors in Georgia. The project would mark the first ground-breaking on a domestic nuclear power plant in about 30 years, the administration said.
Overseas, Hong Kong's Hang Seng market was closed for the Lunar New Year, and Japan's Nikkei gained 0.2%. The FTSE in London gained 1.5%, as did the DAX in Frankfurt.
--Written by Melinda Peer and Sung Moss in New York
.
