New York – Wall Street rallied to finish moderately higher Monday as nervous investors got some reassurance from General Motors Corp.’s new labor agreement and a favorable court ruling for cigarette makers. Technology stocks rebounded ahead of three major profit reports.
The market also got a lift from strong quarterly earnings in the financial sector and the Supreme Court’s refusal to let the government pursue a $280 billion racketeering penalty against tobacco companies.
The upbeat news helped offset the rising price of crude oil, which added nearly $2 a barrel as a strengthening Tropical Storm Wilma posed yet another threat to the Gulf Coast region.
A barrel of light crude climbed $1.73 to settle at $64.36 on the New York Mercantile Exchange.
Ed Peters, chief investment officer at PanAgora Asset Management, said that while corporate earnings have been positive, high oil and gas prices and continued speculation about the Federal Reserve’s interest-rate-tightening campaign have been holding back the market.
“I think there’s still uncertainty about how far the Fed is going to go, and uncertainty about the effect of higher energy prices on the economy,” Peters said. “We’re seeing a modest bounce-back, but it doesn’t seem to have a lot of conviction.”
At the close of trading, the Dow Jones industrial average gained 60.76, or 0.59 percent, to 10,348.10.
The Bloomberg Colorado Index, a price- weighted list of companies with operations in the region, rose 2.41 to 300.36.
Broader stock indicators also advanced. The Standard & Poor’s 500 index rose 3.53, or 0.3 percent, to 1,190.10, and the Nasdaq composite index added 5.47, or 0.26 percent, to 2,070.30.
Bonds stayed flat after last week’s sell- off, with the yield on the 10-year Treasury note unchanged at 4.49 percent from late Friday.
Charles Schwab Corp. posted its largest quarterly profit since the dot-com era, reversing a year-ago loss on sturdy asset growth. The discount brokerage rose 21 cents to $13.34.
