NEW YORK — Industrial and technology stocks pulled the market sharply higher Tuesday after Boeing Co. said it was boosting production and an industry group forecast that demand for computers would increase.
The Dow Jones industrial average rose 213 points to its highest close since May 19 and had its third advance in four days. Major stock indexes rose more than 2 percent.
The advance was broad, but came on light trading volume. That’s a sign that many traders are staying out of the market while they wait to see whether stocks will keep moving higher after weeks of erratic trading.
Industrials made some of the biggest moves following upbeat news from Boeing and Illinois Tool Works. Boeing rose 4 percent after increasing production of the 737 jet. Boeing said customers are adding to existing orders and placing new ones. ITW rose about 2.5 percent after it raised the lower end of its fiscal second-quarter earnings target.
More good news on industrials came from the New York Federal Reserve, which said regional manufacturing expanded for an 11th straight month in June.
“We’re still seeing factories and manufacturing help provide a little stimulus for the economy here,” said Michael Church, president at Addison Capital Group in Philadelphia.
The Dow rose 213.88, or 2.1 percent, to 10,404.77. The broader Standard & Poor’s 500 index rose 25.60, or 2.4 percent, to 1,115.23, The Standard & Poor’s 500 index moved above its average close of the past 200 days, 1,108. The tech-dominated Nasdaq composite index rose 61.92, or 2.8 percent, to 2,305.88.
Technology stocks got a boost after research firm International Data raised its forecast for personal-computer shipments for 2010. IDC said shipments will be up almost 20 percent from 2010, compared with a forecast of a 15 percent increase made in April. Microsoft rose 4.3 percent and Hewlett Packard rose 2.4 percent.
Tuesday’s trading shows that investors have started to put aside some of their uneasiness about Europe and focus on continuing signs of strength in the U.S. Still, the market is susceptible to troubling headlines. On Monday, stocks gave up steep gains, partly because Moody’s cut its rating on Greece’s debt to “junk” status.
Andrew Neale, head of portfolio management at Fogel Neale Partners in New York, is skeptical that the market’s climb will hold. He noted that many individual investors are growing weary of the market’s sharp swings and are pulling money out of mutual funds and other investments. That means the gains are being driven largely by professional traders.
“We don’t see any real retail buying,” Neale said, referring to individual investors. “We’re advising our clients to be very cautious with the market.”
