Updated from 9:43 a.m. EST
Stocks in New York were rallying Monday as investors reacted to President-elect Obama's call over the weekend for the single largest new investment in the nation's infrastructure since the creation of the federal highway system in the 1950s.
"The coming week will hit a wide swath of the economic landscape, from housing to sentiment to inflation and trade," wrote Paul Nolte, director of investments at Hinsdale Associates. "While the Washington two-step with the auto industry is likely to garner much of the attention, the housing numbers may provide a glimmer of hope if, indeed, they can show some modest improvement (or at least not getting worse)."
Dow Jones Industrial Average
was gaining 300 points at 8935, and the
was adding 30 points at 906. The
was up 49 points at 1558.
The trend is a continuation from Friday, when the major indices reversed course to close in positive territory. "It might be that the 40% decline over the past year has already factored in much of the bad news already," wrote Paul Nolte, director of investments at Hinsdale Associates. "As we have been discussing over the past two months, the economic data will be bad for at least the next couple of months as the credit collapse works its way through the economy."
Friday's late uptick came despite uncertainty about a Congressional bailout for the automakers, worse-than-expected
from the Department of Labor, and news of more job cuts at several large firms.
"The dreadful U.S. jobs report for November reinforced Obama's mandate to act decisively, and all indications are that he will," Tony Crescenzi, chief bond market strategist for Miller Tabak, wrote on his
. "The employment news will also empower the
to move further into the realm of quantitative easing and to provide credit where it has become difficult to obtain, including in the mortgage and consumer loan areas, for example."
News of more layoffs in the financial firms continued into the new week. Swiss newspapers reported that
may cut as many as 4,500 jobs. Last week, another Swiss bank,
, said it plans reduce its headcount by 5,300, primarily in investment banking.
In other company news, Dow component
said Monday that it will cut 1,800 jobs next year -- in addition to 1,000 job cuts announced in the third quarter-- and reduced 2008 guidance. 3M also said that 2009 earnings would be well below consensus targets.
Meanwhile, one of the largest chemical makers in the world,
, said it will cut 5,000 jobs and close 20 plants in an effort to save about $700 million annually by 2010. Chairman and Chief Executive Andrew Liveris said the company will not suspend or reduce its dividend, however.
Traders were still awaiting resolution and details of a proposed automaker rescue plan at the start of the week. President Bush is urging action on $25 billion in proposed emergency loans for
. Shares of General Motors and Ford were climbing in recent trading Monday.
Some lower-priced fast-food chains may be rising in appeal as the economic concerns worsen,
announced that same-store sales rose 7.7% in November.
Shifting to commodities, crude oil was rising $3.75 to $44.56 a barrel. Gold was gaining $25 to $777.20 an ounce.
Longer-dated U.S. Treasury securities were edging lower in price. The 10-year was recently down 10/32 to yield 2.74%, and the 30-year was off by a full point to yield 3.17%. The dollar was weaker against the euro and pound, and higher versus the yen.
Overseas, European exchanges such as the FTSE in London and the DAX in Frankfurt were trading significantly higher -- up 6.4% and 8.9%, respectively. In Asia, Japan's Nikkei ended higher, while Hong Kong's Hang Seng also ended with gains.