NEW YORK (Reuters) - Stocks rose on Monday, rebounding from the worst weekly loss in five years, as bargain-hunting and takeover talk sparked gains in the technology sector and higher oil prices lifted energy stocks.
A sharp gain in General Motors Corp's (GM.N) stock after positive comments from a brokerage helped the Dow offset a near 12 percent drop in shares of American International Group Inc (AIG.N), the world's largest insurer.
AIG received a rebuke from its auditors for how it valued some credit derivatives, meaning it could face further losses on U.S. mortgages it insures or invests in, driving its shares to their worst plunge since the 1987 stock market crash.
Nasdaq outpaced the Dow and S&P, led by Apple Inc. (AAPL.O) and Research in Motion (RIM.TO) (RIMM.O), maker of the BlackBerry. Both stocks had fallen more than one-third from their 2007 highs, making them relatively attractive.
"They could have used AIG as an excuse to sell, but since we just had one of the worst weeks in years, we can ignore that," said Alan Lancz, president, Alan B. Lancz & Associates Inc., in Toledo, Ohio.
He said investors see underlying value in the market. "A lot of the technology companies, they really threw the baby out with the bathwater."
The Dow Jones industrial average (.DJI) was up 57.88 points, or 0.48 percent, at 12,240.01. The Standard & Poor's 500 Index (.SPX) was up 7.83 points, or 0.59 percent, at 1,339.12. The Nasdaq Composite Index (.IXIC) was up 15.21 points, or 0.66 percent, at 2,320.06.
GM shares rose 5.1 percent to $27.12 after an analyst said the No. 1 U.S. automaker might report better-than-expected results from its automotive operations this week.
Exxon Mobil Corp (XOM.N) led gains on the S&P as crude oil futures rose 2 percent to $93.59 a barrel.
Shares of Exxon were up 1.9 percent to $83.22. Oil field services firm Schlumberger Ltd. (SLB.N) was up 4 percent to $80.49.
Chevron Corp (CVX.N) is set to join Exxon among the Dow industrials. The oil company, along with Bank of America Corp (BAC.N), will be added to the 30-share average, knocking out diversified manufacturer Honeywell International Inc (HON.N) and tobacco maker Altria Group (MO.N), marking the first change to the index's components in four years.
Honeywell shares were down 0.3 percent to $57.64. Altria shares fell 0.9 percent to $72.42.
Research in Motion stock was up 5.3 percent to $94.47. Apple rose 3.2 percent to $129.45. Citigroup added the iPod maker to its top picks list.
AIG shares were down to $44.74, the lowest in five years. The company disclosed PricewaterhouseCoopers, the company's outside auditors, said AIG failed to account properly for derivatives related to risky debt.
In deal news, Yahoo Inc (YHOO.O) rejected Microsoft Corp's (MSFT.O) takeover bid as too low, raising the possibility of a higher offer. Yahoo shares rose 2.3 percent to $29.87, while Microsoft shares fell 1.2 percent to $28.21.
Motorola Inc (MOT.N) and Nortel Networks Corp (NT.TO) may combine their wireless networking units, according to The Wall Street Journal. Neither company would comment. Motorola's shares rose 2.8 percent to $11.57.
Trading was light on the New York Stock Exchange, with about 1.39 billion shares changing hands, well below last year's estimated daily average of roughly 1.9 billion, while on Nasdaq, about 2.1 billion shares traded, just below last year's daily average of 2.17 billion.
No comments:
Post a Comment