Stocks stretch rally
Wall Street upbeat as investors welcome Microsoft earnings and fiscal stimulus plan.
NEW YORK (CNNMoney.com) -- Wall Street rose Friday morning, extending a two-day advance as investors welcomed Microsoft's earnings and outlook and continued to pick up stocks that were battered in the recent selloff.
The Dow Jones industrial average (INDU) added 0.5 percent in the early going. The broader Standard & Poor's 500 (SPX) index gained 0.7 percent, and the Nasdaq composite (COMP) advanced almost 1 percent.
Late Thursday, Microsoft (MSFT, Fortune 500) reported higher quarterly revenue and profit that topped estimates in its fiscal second-quarter. The software leader also forecast higher sales and earnings for the next two quarters and 2008 fiscal year. Shares of the Dow component jumped 2.8 percent.
Fellow Dow component Honeywell (HON, Fortune 500) reported higher quarterly profit that met expectations and also forecast continued growth in 2008, despite the weakening economy. Caterpillar (CAT, Fortune 500), also a Dow component, reported higher earnings that met forecasts as well.
Stocks have risen for the past two session as investors have dipped back into equities after a miserable start to 2008. Stocks had tumbled through most of the month on worries that the housing and credit market crises will send the economy into a recession, if it isn't there already.
Those worries remain in place, but have been tempered this week by the Federal Reserve's emergency interest-rate cut, talk of a bond insurer bailout and a deal that was struck on a $150 billion fiscal stimulus package and which will take the form of tax rebates for millions of Americans.
Other markets. In global trade, European markets rose in the afternoon, while Asian markets put up big gains.
Treasury prices were little changed, with the yield on the 10-year note at 3.71 percent, roughly where it stood late Thursday. Bond prices and yields move in opposite directions.
In currency trading, the dollar rose versus the euro and the yen.
U.S. light crude oil for March delivery rose 89 cents to $90.30 a barrel on the New York Mercantile Exchange.
COMEX gold rallied $11.20 to $917 an ounce