U.S. stocks rally on weaker dollar, upbeat earnings

10:06, February 17, 2010      

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The U.S. stocks rallied on Tuesday, with the S&P surging the most in three months, as the U.S. dollar weakened against the euro and investors came back from a holiday weekend to embrace a batch of upbeat earnings.

The stock advance was broad based, with advancing stocks outnumbering declining ones on the NYSE by a ratio of about 5 to 1, while about five stocks rose for every two that fell on the Nasdaq.

The dollar weakened against the euro, giving a boost to the prices of commodities by making them cheaper for investors holding other currencies.

U.S. light crude oil for March delivery rose nearly 4 percent to settle at 77.01 dollars a barrel on the New York Mercantile Exchange, helping energy stocks rank among the best performers on the market.

Financial stocks got a boost from Britain's Barclays Plc, which said it nearly doubled profits in 2009 to 18.2 billion dollars.

Bank of America jumped 5.4 percent after it reported " significant gains" in the number of modified mortgages it handles through the government's Home Affordable Modification Program, designed to lower monthly payments for struggling customers.

Two Dow companies released results on Tuesday morning. Merck rallied 2 percent in the day after the drugmaker's earnings topped analyst estimates, while Kraft Foods Inc. slipped 0.4 percent after organic sales climbed less than some analysts' projection.

Also lifting market sentiment, a report on manufacturing in the New York area was stronger than expected. The Empire State manufacturing index rose to 24.91 this month from 15.92 in January, much higher than a forecast of 18.

Meanwhile, fears over the euro zone also ebbed somewhat after the European finance ministers' meeting provided more visibility into the euro zone's coordination, helping push stock markets higher.

As of Tuesday's close, the Dow Jones surged 169.67, or 1.68 percent, to 10,268.81. The Standard & Poor's 500 index rallied 19. 36, or 1.80 percent, to 1,094.87 and the Nasdaq was up 30.66, or 1. 40 percent, to 2,214.19.

Source: Xinhua
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