NEW YORK — A rebound in commodities drew investors back into the stock market Tuesday and helped push stocks to new highs for 2009.
Major stock indicators rebounded from a drop the day earlier to end at their highest levels in 11 months. The Dow Jones industrials rose 51 points after falling 41 on Monday.
After soaring 50.1 percent since hitting a 12-year low in early March, the Dow stands 170 points below the 10,000 mark — a level the average first crossed in March 1999. After the recent recession, it hasn’t been above 10,000 since last October.
In an about-face, the dollar weakened against other major currencies. That helped lift commodities such as oil and gold as well as energy and material stocks. Financial stocks also rose sharply.
The gains came as the Federal Reserve began a two-day meeting on interest rates. Investors are hoping the central bank will provide a clearer indication of when it might raise rates. Analysts also expect the statement that the Fed issues at the conclusion of its meeting today will indicate that the economy is improving. Fed Chairman Ben Bernanke said last week that the U.S. recession was “likely over” from a technical standpoint, even though troubles such as high unemployment remain.
The Fed is widely expected to keep rates at their record low of near zero for the time being. Rock-bottom interest rates have helped fuel the market’s nearly 7-month-old rally, making cash plentiful and cheap.
The Dow Jones industrial average rose 51.01, or 0.5 percent, to 9,829.87, its highest close since Oct. 6, when it finished at 9,956. The broader Standard & Poor’s 500 gained 7.00, or 0.7 percent, to 1,071.66, while the Nasdaq composite rose 8.26, or 0.4 percent, to 2,146.30 — both 11-month highs.
The market appears to be following a well-established pattern where brief dips are met with more buying.
“Reluctantly, investors are continually being dragged into a market that is finding a path of least resistance to the upside,” said Art Hogan, chief market analyst at Jefferies & Co.
“Right now, it’s a more orderly market,” said Greg Reynholds, senior vice president of asset management at Lenox Advisors. “People are digesting the data, trying to figure out exactly where we’re headed.”
