NEW YORK, (Reuters):
STOCKS PUSHED higher in late yesterday, erasing earlier losses, as investors snapped up shares that had fallen to the bottom end of their recent range.
Equities also benefited from a halt in the bond market's slide. Worries that falling bond prices and a run-up in interest rates could stifle an economic rebound sent major stock market gauges sharply lower in early trading. Those fears faded somewhat, however, as US Treasuries attempted a modest rally.
Traders also took the stock market's slide to the bottom end of its recent trading range as an opportunity to nibble at beaten-down stocks.
But with the peak of the earnings season past and trading volumes thinned in the typically slow summer season, Wall Street is likely to remain pinned in that range, awaiting its next big cue.
A bigger-than-expected rise in factory orders yesterday and a surprising jump in US second-quarter growth last week have underpinned investor sentiment, said Charles White, portfolio strategist at OAM Avatar LLC. "But (there's) nothing that gives you palpable evidence that the second half is going to turn out to be everything that people who are really bullish on the economy had hoped for."
The blue-chip Dow Jones industrial average was up 36.28 points, or 0.4 per cent, at 9,190.25, after dropping one per cent earlier. The broader Standard and Poor's 500 Index was up 3.76 points, or 0.38 per cent, at 983.91, and the technology-laced Nasdaq Composite Index gained 4.46 points, or 0.26 per cent, to 1,720.08.
At its low of the day, the S&P 500 dropped as low as 966.76, its lowest intraday level in a month.
Stocks have climbed since hitting 2003 lows in March on bets for a solid economic rebound this year, but investors are hesitant to push prices higher after such a large run-up.
A report shortly after the open showed that factory orders rose 1.7 per cent in June - the sharpest rate in three months and above Wall Street's expectations.
The bond market has grabbed some of the spotlight in recent weeks due to concerns about rising interest rates. US Treasuries were trying to piece together a modest rally yesterday, taking advantage of a setback for stocks. But sentiment was skittish at best after weeks of punishing losses. Stock investors fear higher rates could put a crimp in the long-awaited pickup in the US economy.
Verizon Communications Inc. climbed US$1.67, or 5 per cent, to US$36.05. Verizon employees reported to work as usual yesterday after unions agreed to negotiate past a weekend deadline, avoiding a strike that would have put line technicians and telephone operators on picket lines from Maine to Virginia, a union spokeswoman said.
