Dow Takes the Day

Mike · Member

Blue chips surged to a new closing high for the year Thursday as investors celebrated a flurry of bullish earnings news ahead of Dell's fourth-quarter report.

The Dow Jones Industrial Average rose 85.50 points, or 0.8%, to 10,749.61, its best level since closing at 10,783,01 on Dec. 31. The S&P 500 added 5.02 points, or 0.4%, to 1197.01 and the Nasdaq -- which spent the morning lower -- added 0.55 points to 2053.10. The 10-year Treasury bond was down 24/32 in price to yield 4.07%, having fallen to a 3 1/2-month low Wednesday, while the dollar was higher against the yen and euro.

Volume on the New York Stock Exchange was 1.51 billion shares, with advancers beating decliners by a ratio of 9-to-7. Volume on the Nasdaq was 2.08 billion shares, with decliners beating advancers 8-to-7.

"I was surprised at this morning's weakness given expectations that Dell's numbers will be OK," said Joe Liro, equity strategist with Stone & McCarthy Research Associates. "Investors are just really looking at Dell's news, and expect it to be better than the downbeat Cisco news yesterday. There's no specific catalyst for the nice run-up this afternoon."

After the bell, Dell delivered the upside surprise traders anticipated on the bottom line, but came up slightly light on sales. Dell's fourth-quarter earnings fell 11% from a year ago to $667 million, reflecting a charge related to the repatration of overseas income. Before the charge, Dell earned $947 million, or 37 cents a share, a penny better than expectations. At $13.46 billion, however, sales were about $100 million light. Dell finished Thursday up 58 cents, or 1.4%, to $41.57.