U.S. stocks rose to fresh 12-month highs on Monday as optimistic investors rode a wave of solid quarterly results.
Earnings from companies, including Gannett Co Inc
So far, three out of four earnings have been better than expected, no real horror stories, and at this point (the advance) looks set to continue, said Frank Lesh, broker and futures analyst with Future Path Trading in Chicago.
We still got a couple more weeks to go (in earnings). But so far, so good. The market is telling us to be long and stay long.
As of Monday, 62 companies in the S&P 500 had reported earnings, with 79 percent above analysts' expectations, according to data compiled by Thomson Reuters.
This week's earnings include 13 Dow components and 135 companies in the S&P 500.
The Dow Jones industrial average <.DJI> added 96.28 points, or 0.96 percent, to end at 10,092.19. The Standard & Poor's 500 Index <.SPX> gained 10.23 points, or 0.94 percent, to 1,097.91. The Nasdaq Composite Index <.IXIC> rose 19.52 points, or 0.91 percent, to 2,176.32.
The Dow industrials and the S&P 500 closed at levels not seen since October 2008, while Nasdaq is at an almost 13-month closing high.
Monday's rally coincided with the 22nd anniversary of Black Monday, as October 19, 1987, is known, which was the day the Dow industrials fell more than 22 percent -- still the largest daily percentage drop on record.
CATERPILLAR LIFTS THE DOW
Caterpillar led the Dow industrials, gaining 6 percent to $57.85 after Bank of America-Merrill Lynch raised its price target to $65 from $52, and increased its 2010 and 2011 earnings-per-share expectations, citing a faster recovery in machinery revenue next year. Caterpillar is set to report results on Tuesday.
Gannett Co Inc
Diversified manufacturer Eaton Corp
In other news, the Market Vector Agribusiness ETF
Home builders' shares slid, with the Dow Jones home construction index <.DJUSHB> down 1.3 percent.
Frank Husic, managing partner and chief investment officer of Husic Capital Management in San Francisco, said the home building sector's shares were hurt by concerns the current $8,000 tax credit to first-time home buyers, which expires on November 30, would not be extended.
Shares of KB Home
(Editing by Jan Paschal)