U.S. stocks rose in light trading on Tuesday, as better than expected earnings reports, analyst upgrades and rising commodities prices influenced gains.

The Dow Jones Industrial Average closed up 169.67 points, or 1.68 percent, at 10,268.81. The S&P 500 Index closed at 1,094.87, up 19.36 points or 1.80 percent.

Firms involved in commodities, financials and pharmaceuticals are among the biggest gainers.

Commodities Firms

Oil futures for March on the New York Mercantile Exchange rose 4.05 percent to $77.13, the price of copper on the Comex market rose 4.46 percent to $3.22.

Four oil companies were upgraded by Sanford C. Bernstein analysts today to Outperform from Market Perform. Shares of Chevron (NYSE:CVX), Marathon Oil (NYSE:MRO), and Hess (NYSE:HES) rose 2.79 percent, 3.77 percent and 3.49 percent respectively. American Depositary Shares of Royal Dutch Shell (NYSE:RDS.A) rose 1.91 percent.

Steel companies were big gainers in this sector; U.S. Steel (NYSE:X) closed up 6.59 percent and AK Steel (NYSE:AKS) closed up 6.41 percent.


Merck (NYSE:MRK) reported earnings in-line with expectations and revenues above expectations before the market opened this morning. Investors cheered the results as Merck closed up 2.00 percent and similar firms are also rose.

Bristol Myers (NYSE:BMY) closed up 1.25 percent and Johnson & Johnson (NYSE:JNJ) closed up 1.42 percent. The American Depository Receipts (ADRs) of GlasoSmithKline (NYSE:GSK) closed up 1.29 percent, lifted by a JPMorgan upgrade.


Financials also performed well as Barclays (NYSE:BCS), whose ADRs closed up 14.09 percent, reported better than expected earnings and Deutsche Bank AG (USA) (NYSE:DB), which closed up 5.30 percent, benefited from a JPMorgan upgrade.

Bank of America (NYSE:BAC) led the Dow and Wall Street firms with a gain of 4.91 percent.

Thin Volume

Pat O'Hare, Chief Market Analyst at Briefing.com, called Tuesday's trading an exhale trade, where the market is breathing a sigh of relief on the lack of bad news after coming back from a long weekend. He also questioned the sustainability of the rally.

There is not a lot of volume behind the gains, which suggests participation is limited, said O'Hare. That makes it easier to move prices; and the positive bias is sparking short-covering activity that makes the rally look stronger than it is.

The sustainability of the rally remains in question, O'Hare added.

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