Dow: 11,000 at the finish line

By Alexandra Twin, senior writer


NEW YORK (CNNMoney.com) -- Stocks managed gains Monday, with the Dow industrials closing above 11,000 for the first time in 18 months, after European leaders made loans available to Greece, tempering fears that the nation might have to default on its debt.

But lingering concerns ahead of the start of the quarterly reporting period limited the gains.

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The Dow Jones industrial average (INDU) added 8 points or 0.1%, finishing at 11,005.97, the highest close since Sept. 26, 2008, when it ended at 11,143.13.

"11,000 is a nice number but it's more psychological than anything," said Jim Dunigan, chief investment officer at PNC Wealth Management. "The S&P is getting close to 1,200 and that's another big round number."

The S&P 500 index (SPX) gained 2 points, or 0.2%, ending at 1196.48, an 18-month high. The Nasdaq composite (COMP) edged up 4 points, or 0.2%, to the highest finish since June 19, 2008.

After the close, Dow component Alcoa (AA, Fortune 500) ignited the quarterly reporting period. The aluminum maker posted earnings of 10 cents per share versus a loss of 59 cents a year earlier, meeting the expectations of analysts surveyed by Thomson Reuters. Alcoa reported revenue of $4.89 billion versus $4.147 billion a year ago. Analysts expected revenue of $5.238 billion.

"Alcoa was a pretty good start, but expectations for this earnings period are high and there's the potential for disappointment," Dunigan said.

First-quarter earnings are expected to have risen 37% versus the prior year, while revenue is expected to have risen 10%, according to Thomson Reuters.

Gains are expected to be driven by financials, materials and consumer discretionary -- the sector that includes autos and retailers.

Intel (INTC, Fortune 500) reports results on Tuesday, while Google (GOOG, Fortune 500), JPMorgan Chase (JPM, Fortune 500) and Bank of America (BAC, Fortune 500) are due later in the week.

Stocks closed higher Friday at the end of another up week for stocks. The market has risen in seven of the last eight weeks as economic confidence has replaced jitters about a global slowdown that felled markets in January.

Both the Dow and S&P 500 stand at roughly 18-month highs, while the Nasdaq stands at the highest point in nearly two years.

Greece: Investors got another bout of good news on the global front over the weekend, when European leaders agreed to make loans available to debt-burdened Greece.

The 16 countries that use the euro agreed to provide a collective $40 billion, while the International Monetary Fund (IMF) agreed to kick in $13.5 billion.

The loans, should Greece choose to access them, would have interest rates that are lower than what lenders had been requiring in recent days to hold Greek debt. Last Thursday, Greece's borrowing costs hit an all-time high as investors worried the country might default.

Greece is seen as something of the tip of the iceberg, with investors worrying that a default would exacerbate problems in other debt-burdened nations. Greece is one of the so-called PIIGS, along with Portugal, Ireland, Italy and Spain.

Recession questions: Although most economists think that the recession is over, the panel of economists who are responsible for specifying changes in the business cycle aren't sure yet.

The National Bureau of Economic Research said Monday that it is premature to say whether the recession that began in December 2007 has ended. The group is apparently wary to call an end when there is still the threat of a so-called double dip recession.

World markets: In overseas trading, European markets were mixed, with London's FTSE up 0.1%, France's CAC 40 and Germany's DAX both little changed. Asian markets were mixed, with the Hong Kong Hang Seng down 0.3% and the Japanese Nikkei up 0.4%.

Bonds: Treasury prices rallied, lowering the yield on the 10-year note to 3.85% from 3.89% late Friday. The 10-year had risen as high as 4% Monday, an 18-month high. Treasury prices and yields move in opposite directions.

The dollar and commodities: The dollar fell versus the euro and gained against the yen.

COMEX gold for June delivery rose $3 to settle at $1,162.20 per ounce.

U.S. light crude oil for May delivery fell 58 cents to settle at $84.34 a barrel on the New York Mercantile Exchange.

Market breadth was positive. On the New York Stock Exchange, winners beat losers eight to seven on volume of 976 million shares. On the Nasdaq, advancers beat decliners seven to six on volume of 2.06 billion shares.  To top of page

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Index Last Change % Change
Dow 16,912.11 -70.48 -0.42%
Nasdaq 4,442.70 -2.21 -0.05%
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Treasuries 2.46 -0.03 -1.16%
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