NEW YORK (CNN/Money) -
U.S. stocks rose Wednesday, breaking a four-session losing streak, as investors jumped back into the market following a strong report on the housing market, a bounce in the U.S. dollar, and some upbeat corporate news.
The Nasdaq composite (up 17.90 to 1899.65, Charts) gained nearly 1 percent, the Dow Jones industrial average (up 66.30 to 9690.46, Charts) gained 0.7 percent, and the Standard & Poor's 500 (up 8.29 to 1042.44, Charts) index gained 0.8 percent.
"The markets are rebounding a little after several sessions of weakness that stemmed from rising oil prices, rising fears of terrorism and a sharp decline in the dollar," said Michael Sheldon, chief market strategist at Spencer Clarke. "Those issues have somewhat abated today, but they are issues the market will continue to face over the next few weeks. As a result, you could see more profit taking."
Bullish news for technology shares Thursday included an upbeat earnings report from Dow component, Hewlett-Packard (HPQ: up $0.56 to $22.21, Research, Estimates). The company reported quarterly earnings of 36 cents per share, a penny more than expected and up from the 24 cents it earned a year earlier. Shares rose 3.2 percent during the session and added another 2.7 percent after-hours.
The major indexes declined for four sessions in a row as investors played it cautious after the market's big run this year. Tuesday's selloff was sparked in part by a plunge in the dollar, which fell to an all-time low versus the euro and dipped versus the yen. The dollar recovered Wednesday, edging up against both currencies, aided in part by rumors that the Japanese government had intervened to stem the greenback's fall.
Buying was broad-based, with 25 out of the 30 Dow stocks closing in positive territory.
"The long-term trend of the market is upward, but it's not surprising that we had a pullback for a few sessions," said Timothy Ghriskey, president, Ghriskey Capital Partners.
"There's factors at play such as a slight recovery in the dollar, GE's IPO announcement, Schwab buying SoundView, all of which makes people feel better," Ghriskey added. "But really, it's that too many people in the last few days were talking about a correction, and when everyone's talking about it, it doesn't happen."
A number of retailers are due to report their earnings early Thursday, including Dillard's (DDS: down $0.08 to $14.46, Research, Estimates), Limited (LTD: up $0.04 to $17.49, Research, Estimates), Sharper Image (SHRP: up $0.50 to $31.40, Research, Estimates), and Wet Seal (WTSLA: up $0.10 to $11.35, Research, Estimates), but none are particularly market-moving.
Thursday morning also brings the weekly jobless claims report. According to Briefing.com estimates, 365,000 Americans are expected to have filed new claims for unemployment last week, virtually unchanged from the 366,000 filings the previous week.
In addition, the October index of Leading economic indicators (LEI) is forecast to have risen 0.2 percent after falling 0.2 percent last month.
On the move
Dow component General Electric (GE: up $1.03 to $29.47, Research, Estimates) gained 3.6 percent and was the NYSE's most actively traded issue after the company raised its dividend by 5 percent and announced it would split off most of its mortgage and life insurance operations through an initial public offering.
Other Dow gainers included Caterpillar (CAT: up $1.48 to $72.77, Research, Estimates) and Intel (INTC: up $0.68 to $32.52, Research, Estimates), both up around 2 percent.
Discount broker Charles Schwab (SCH: down $0.08 to $11.34, Research, Estimates) said it will buy smaller rival SoundView Technology Group (SNDV: up $2.16 to $15.41, Research, Estimates) for $325 million in cash. Shares of Schwab closed little changed, while SoundView rallied 16.3 percent in active Nasdaq trading.
But sentiment was decidedly less upbeat elsewhere in the financial sector. Adding to the spate of scandals that has plagued Wall Street over the last few years, FBI agents charged 47 foreign-exchange brokers, including traders at J.P. Morgan and UBS Warburg, with criminal conduct as part of an extensive investigation into securities and currency fraud.
Among other movers, Sirius Satellite Radio (SIRI: down $0.12 to $2.11, Research, Estimates) was the Nasdaq's most-active issue, losing 5.5 percent after the company said it will sell 73.2 million common shares to raise extra cash.
A surge in housing starts and building permits added to the positive mood, providing evidence that the booming housing market continues to thrive. The pace of housing starts rose to a seasonally adjusted annual rate of 1.96 million units in October, after rising a revised 1.91 million units in September. Economists surveyed by Briefing.com expected a fall to a 1.85-million-unit pace.
Building permits rose to an annualized rate of 1.97 million units in October, after falling to a 1.87-million-unit pace in September. Economists expected permits at a pace of 1.85 million units.
NYMEX light sweet crude oil futures fell 63 cents to settle at $32.07 a barrel. COMEX gold fell $2.70 to settle at $394.90 an ounce.
Treasury prices fell sharply, pushing the 10-year note yield up to 4.24 percent from 4.14 percent late Tuesday.
Market breadth was positive. On the New York Stock Exchange, winners beat losers by nearly 3 to 2 as 1.31 billion shares changed hands. On the Nasdaq, advancers beat decliners by more than 9 to 7 as 1.77 billion shares traded.
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