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Wednesday January 7, 12:40 AM
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Wall St up as tech strength offsets weak data
By Deepa Seetharaman
NEW YORK (Reuters) - Strength in the tech sector boosted U.S. stocks on Tuesday, overshadowing data showing slumping factory orders and dismal pending home sales.
Apple Inc helped drive the Nasdaq higher for a second day after Oppenheimer & Co upgraded the stock, saying Chief Executive Steve Jobs' letter to investors about his health allayed concerns of an unplanned leadership change.
Investors also bet technology stocks would benefit from President-elect Barack Obama's proposed economic plan that would include the largest U.S. infrastructure investment since the 1950s.
"The prospects are slightly better for producers of computerware. Tech stocks are also receiving a boost from the Obama initiative to spend on technology infrastructure," said Andrew Wilkinson, senior market analyst at Interactive Brokers Group in Greenwich, Connecticut.
International Business Machines Corp and Hewlett-Packard Co pulled the Dow higher, rising 2.5 percent and 4.5 percent respectively.
The Dow Jones industrial average rose 68.34 points, or 0.76 percent, at 9,021.23 and the Standard & Poor's 500 Index gained 8.87 points, or 0.96 percent, at 936.32. The Nasdaq Composite Index rallied 24.41 points, or 1.50 percent, at 1,652.44.
Oil prices rose, pushing energy shares higher. Chevron gained nearly 2 percent.
Still, weaker-than-expected new orders received by U.S. factories in November and a seven-year low in pending home sales for the same month spurred concerns about mounting job losses and the deepening U.S. recession.
"We know we've been through a difficult period and the economy has weakened substantially," said Warren West, principal at Greentree Brokerage Services in Philadelphia. "We don't know how much further it will weaken. We're not sure if we've seen the bottom in the market."
Aside from the broker upgrade, investors were keeping a close eye on Apple's 2009 Macworld trade show for new product announcements and any further clues on CEO Jobs' health, even though hr was not scheduled to appear.
Microsoft added 1.6 percent to $20.85 after the software maker said it sold 28 million units worldwide of its Xbox 360 video game console through the end of 2008, expanding the Xbox's lead over rival Sony Corp's PlayStation 3 console in worldwide unit sales.
