Stocks Boosted by Factory Orders, Vehicle Sales

NEW YORK ( TheStreet) -- The major U.S. equity indices finished Tuesday's holiday-shortened session with solid gains after data on factory orders in May came in slightly better than expected and June vehicle sales were strong.

Wall Street was also lifted by positive trading action in Europe, where stocks rose ahead of the European Central Bank's latest policy meeting on Thursday. The ECB is widely expected to announce an interest rate cut of 25 basis points.

The Dow Jones Industrial Average rose more than 72 points, or 0.56%, to close at 12,944. Breadth was positive with 23 of the blue-chip index's 30 components on the rise, led by Alcoa ( AA), Caterpillar ( CAT), and Wal-Mart Stores ( WMT).

Home Depot ( HD) was the biggest percentage decliner within the Dow, falling more than 2%. Pfizer ( PFE) and AT&T ( T) were also weak.

The S&P 500 gained nearly 9 points, or 0.62%, to settle at 1374. The Nasdaq Composite tacked on 25 points, or 0.84%, to finish at 2976.

The utilities, basic materials and energy sectors enjoyed the biggest gains. Breadth within the broad market was very positive with advancers ahead of decliners by about 3-to-1 ratio on the Nasdaq and approximately 4-to-1 on the New York Stock Exchange.

U.S. stock exchanges are closed on Wednesday for the Independence Day holiday.

After Monday's disappointing manufacturing data, the Commerce Department said factory orders rose 0.7% in May, better than the consensus estimate for a 0.4% increase and an improvement from April's 0.6% decline in April.

Monthly vehicle sales were robust, sending shares of the auto makers markedly higher and giving bullish investors fuel for the argument that the U.S. consumer is still holding up well. Ford ( F) shares rose more than 2% and General Motors ( GM) was surging 6% as the market cheered their respective reports.

Mike Boyle, senior vice president at Advisors Asset Management, believes investors havealready priced in some disappointment with regard to Friday's June jobs report. He estimates it would take an increase in nonfarm payrolls of 50,000 or less to prompt a sell-off. The consensus estimate currently sits at around 90,000 after May's weak job creation of 69,000.

Conversely, for there to be a rally based on the employment data, Boyle said the report would have to show upwards of 160,000 new jobs.

The FTSE in London rose 0.83% to close at 5688, while the DAX in Germany jumped 1.3% to settle at 6578. Hong Kong's Hang Seng index rose 1.5% and the Nikkei in Japan booked a 0.7% gain.

August crude oil futures advanced $3.76 to $87.51 a barrel., buoyed by worries about signs of rising tension in Iran. August gold futures soared $22.90 to $1,620.60 an ounce.

The benchmark 10-year Treasury was down 11/32, raising the yield to 1.625%, while the greenback was down 0.07%, according to the dollar index.

In corporate news, Barclays ( BCS) CEO Bob Diamond has resigned, making him the second senior executive to leave the bank after an alleged interest-rate rigging scandal. The stock closed down 2% on heavy volume.

Microsoft ( MSFT) announced plans Monday to record an asset impairment charge of $6.2 billion on its acquisition of aQuantive. Shares edged up 20 cents to finish at $30.76.

-- Written by Alexandra Zendrian in New York.

>To contact the writer of this article, click here: Alexandra Zendrian

>To submit a news tip, send an email to: tips@thestreet.com.

>To follow the writer on Twitter, go to Alexandra Zendrian.

More from Markets

Dow Fluctuates, Nasdaq Rises as Tech Shares Trade Higher

Dow Fluctuates, Nasdaq Rises as Tech Shares Trade Higher

Boeing Falls on Report It Withheld Potential Hazards of Flight-Control Feature

Boeing Falls on Report It Withheld Potential Hazards of Flight-Control Feature

D.R. Horton Expands in Midwest With Westport Homes Buy

D.R. Horton Expands in Midwest With Westport Homes Buy

FAANG Stocks Rally in Big-Tech Rebound

FAANG Stocks Rally in Big-Tech Rebound

What a Strong Dollar Means for the Market - Jim Cramer Breaks It Down

What a Strong Dollar Means for the Market - Jim Cramer Breaks It Down