Stocks rose on Friday on better-than-expected results from companies including American Express and Ford as reassuring data on manufacturing and housing boosted hopes the recession is showing signs of abating.
Struggling automaker Ford Motor Co
Energy shares also gave a boost as the price of oil rose above $51 a barrel. Chevron was among the Dow's biggest lifts, up 2.2 percent to $66.98.
Government data showed durable goods orders slipped in March, but fell far less than Wall Street expected. Sales of new single-family homes dropped, but inventories plummeted at a record pace.
Investors are keen for further signs the recession may be moderating to build on the optimism that spurred the recent rally from early March.
The earnings news last night as well as this morning in general appears to be relatively positive and, at the core, the durable goods orders this morning also provided further indication that the manufacturing sector is showing tentative signs of improvement, said Michael Sheldon, chief market strategist at RDM Financial in Westport, Connecticut.
The Dow Jones industrial average <.DJI> rose 72.64 points, or 0.91 percent, to 8,029.70. The Standard & Poor's 500 Index <.SPX> gained 7.97 points, or 0.94 percent, to 859.89. The Nasdaq Composite Index <.IXIC> was up 19.67 points, or 1.19 percent, at 1,671.88.
A concept paper on the government stress tests for the 19 biggest U.S. financial institutions is set to be released at 2 p.m. EDT, according to a source familiar with the process.
The paper will describe regulators' evaluation of how the institutions would fare if the economy took an even sharper turn for the worse. The KBW Bank index <.BKX> was off nearly 1 percent.
Software giant Microsoft Corp
Ford, mired in the deep auto sector downturn, posted a smaller-than-expected loss and said it did not expect to seek government loans. Ford also said it burned through less cash that it did in the second half of last year, sending its shares up more than 15.4 percent to $5.18.
American Express was the Dow's biggest boost, up 12.6 percent at $23.61.
But the latest earnings reports still showed the pressures of the global economic slump, with diversified manufacturers Honeywell International Inc
Shares Honeywell fell 3.7 percent to $31.18, while 3M added 2.3 percent to $55.47.
The S&P 500 index is off more than 1 percent for the week and if it ends the week lower, it will snap a six-week streak of gains. Since the bear market lows of early March, the index is up about 27 percent.
(Reporting by Leah Schnurr)