Stocks to wrap up 2009 on high note

NEW YORK (Reuters) - Wall Street is likely to make a strong showing in the final week of 2009 as the bulls gear up to toast the first annual advance for U.S. stocks in two years on hopes of more economic stability in 2010.

The U.S. stock market's resiliency since the March bottom has put investors in the mood to celebrate. The trading week will be cut short by the New Year's Day holiday on Friday, when U.S. financial markets will be closed.
The S&P 500 is poised for what could possibly be its best year since 2003 -- in sharp contrast to a year ago, when stocks plummeted in the fallout from the mortgage crisis and panic rocked investors as 2009 got under way.
Even though no "all clear" has been sounded for the U.S. economy, equity strategists said stocks were poised to add to recent gains this week and build a base for a solid start to 2010 as optimism about the recovery grows.
There is an expectation now that economic indicators will keep showing improvements in key areas like housing and the labor market.
"There's an upward bias," said Alan Lancz, president of Alan B. Lancz & Associates Inc, an investment advisory firm, based in Toledo, Ohio. "Economic numbers have been good. It's been an ideal situation for equities as there aren't that many other alternatives. I think the smarter money is going into equities."
The benchmark Standard & Poor's 500 .SPX started out November in a tight trading range. But by Christmas Eve, when stock trading ended early for the holiday, the S&P 500 had climbed to a 14-month closing high as investors bet the recovery would be strong enough to justify loftier stock valuations. U.S. markets were closed on Friday for Christmas.
DOUBLE-DIGIT GAINS FOR 2009
The S&P 500 is up 66.5 percent from a 12-year closing low set on March 9. Its trading levels now imply a forward price/earnings ratio of 15.5, according to Thomson Reuters data.
And oh, what a difference a year makes. The S&P 500 ended 2008 down 38.5 percent.
But for 2009, the S&P 500 is up 24.7 percent -- a gain that puts the broad market index on track for what could be its best year since 2003. An even stronger advance this week could put the S&P 500 in position for its best year since 1998.
For 2009, the Dow is up 19.9 percent and the Nasdaq is up 45 percent.
"The market is telling us that the economy is a lot stronger than people are giving it credit" for, said Cleveland Rueckert, a market analyst at Birinyi Associates in Stamford, Connecticut.
Although there might be some profit-taking in the final days of the year, the stock market's underlying tone should still be positive, Reuckert added.
"In our view, the market is going to go higher."
The ritual of window dressing should also support the stock market in the coming week, according to analysts. That strategy involves selling stocks with large losses and buying winners near the end of the year or quarter to improve a portfolio's performance.
"The fact that it's year-end is going to cause a fair amount of volatility on probably relatively light volume," said Michael James, senior trader at regional investment bank Wedbush Morgan in Los Angeles. "I would expect the bias would be to the upside toward the end of the week."
Volatility may be enhanced in a holiday-shortened week, when the U.S. stock market will be open for only four days.
Volume may be exceptionally light, with many market participants taking time off through New Year's Day.
CONSUMER CONFIDENCE ON TAP
Economic and corporate calendars are light this week. But there will be a few items worth keeping an eye on, including the U.S. Treasury's auctions of $118 billion of two-year, five-year and seven-year notes.
Investors will watch for how much demand there is for U.S. government debt as efforts to revive the economy pump up government spending.
As the holiday shopping season comes to a close, the Conference Board's index of December consumer confidence will merit Wall Street's attention on Tuesday. The forecast calls for a December reading of 52.3, up from 49.5 in November, according to economists polled by Reuters.
Investors will note the October S&P/Case-Shiller home price index, also due on Tuesday.
On Wednesday, the Institute for Supply Management-Chicago's December index of business activity in the U.S. Midwest region is set for release. The median forecast of economists polled by Reuters puts the ISM-Chicago index at 55.0 in December, down from 56.1 in November. A reading above 50 indicates expansion.
The government report on weekly jobless claims is due to be released on Thursday. Reports on the labor market are being scrutinized closely as investors try to determine when job growth might resume.
November's surprisingly upbeat nonfarm payrolls report showed the U.S. unemployment rate dipped to 10 percent from 10.2 percent. That slight improvement in the job market led investors to wonder about the potential removal of some of the U.S. Federal Reserve's stimulus measures and the prospects for interest-rate increases next year.
But to keep the fledgling recovery going, the Fed pledged again on December 16, at the end of its last policy meeting, to keep interest rates low for an extended period of time.
The Fed is hard-pressed to prevent the economy from sliding back into a slump, which would result in a double-dip recession.
The policy of near-zero interest rates has let investors to borrow dollars cheaply to then invest in higher-yielding assets like stocks.
"We think it's a good time to be invested in equities, and equities continue to offer the best risk-reward (ratio) among the major financial assets," said Tim Ghriskey, chief investment officer of Solaris Asset Management in Bedford Hills, New York.
(Reporting by Ellis Mnyandu; Additional reporting by Leah Schnurr and Chuck Mikolajczak; Editing by Jan Paschal)

U.S. Economy: Home Sales Exceed Forecasts as Buyers Seek Credit

Dec. 22 (Bloomberg) -- Sales of existing U.S. homes in November rose to the highest level in almost three years as first-time buyers rushed to take advantage of a government tax credit and lower prices.
Purchases increased 7.4 percent to a 6.54 million annual rate, exceeding the highest estimate of economists surveyed by Bloomberg News, figures from the National Association of Realtors showed today in Washington. Another report showed the economy grew a less-than-forecast 2.2 percent in the third quarter as companies cut stockpiles, pointing to manufacturing gains at the start of 2010.
The housing market is getting a boost from efforts by the government and Federal Reserve to stabilize the industry at the center of the worst recession since the 1930s. Improved consumer spending combined with record decreases in inventories will promote production, which may keep the world’s largest economy growing into 2010.
The economy is “rebounding again pretty much across the board,” said Steven Wieting, managing director of economic and market analysis at Citigroup Global Markets Inc. in New York. “We will see somewhat stronger growth,” he said, adding “it’s not going to be one of these dramatic recoveries.”
Stocks rose and Treasury securities fell after the reports. The Standard & Poor’s 500 Index added 0.4 percent to 1,118.79 at 1:28 p.m. in New York, and the S&P Homebuilder Supercomposite Index was up 3.8 percent. The yield on the 10-year Treasury note rose to 3.74 percent from 3.68 percent late yesterday.
Slower Expansion
The economy grew at a 2.2 percent annual rate in the third quarter, down from a prior estimate of 2.8 percent, revised figures from the Commerce Department showed today. Companies curbed spending and cut inventories at an even faster pace, leading to a slower pace of expansion.
Existing home sales were projected to rise to a 6.25 million annual rate, according to the median forecast of 69 economists in a Bloomberg News survey. Estimates ranged from 5.2 million to 6.5 million. The NAR revised October’s reading down to a 6.09 million pace from an initially reported 6.1 million rate.
First-time buyers accounted for 51 percent of sales last month, and 71 percent of the houses sold cost less than $250,000, the report from the real-estate agents’ group showed. The figures indicate the government’s tax credit helped boost demand.
Mortgage Rates
Fed debt purchases are helping keep mortgage rates close to record lows, while President Barack Obama’s Nov. 7 extension and expansion of the tax credit through April may provide short-term impetus to sales and construction.
The central bank last week signaled it would keep lending rates low for “an extended period” to foster growth. The average rate on a 30-year fixed mortgage was 4.94 percent last week and has averaged 4.85 percent since the end of October, according to Freddie Mac.
“Housing is on a solid footing through to the spring markets,” said Derek Holt, an economist at Scotia Capital Inc. in Toronto, who forecast a rise to 6.5 million units. “But once foreclosed, unlisted homes go back on the market and homebuyers’ incentives come off, we’re looking at a weaker back half of next year.”
Purchases of existing homes rose 44 percent in November compared with a year earlier, the biggest increase on record. The median price was $172,600, down 4.3 percent from November 2008. The figure is influenced by the mix of sales and the drop reflects the growing proportion of lower-priced houses.
Home Prices
A report from the Federal Housing Finance Agency in Washington showed home prices fell 1.9 percent in October from a year earlier. The group’s U.S. housing index is down 10.8 percent from the April 2007 peak.
The number of previously owned unsold homes on the market fell 1.3 percent to 3.52 million. At the current sales pace, it would take 6.5 months to sell those houses compared with 7 months at the end of October. The ratio is the lowest since December 2006.
The share of homes sold as foreclosures or otherwise distressed properties was 33 percent, said Lawrence Yun, the agents group’s chief economist.
“The tax credit had the intended impact of drawing buyers in and lowering inventory,” Yun said in a news conference. “An estimated 2 million buyers have taken advantage of the credit.”
Single-Family Sales
The report showed sales of existing single-family homes rose 8.5 percent to an annual rate of 5.77 million. Sales of condos and co-ops were unchanged at a 770,000 rate.
Toll Brothers Inc., the largest U.S. luxury-home builder, projected deliveries may fall by as much as 33 percent in the 12 months through October 2010, and the average selling price may drop as low as $540,000.
“We believe it may take some time for Americans to regain confidence in our economy, their job status and the benefits of home ownership,” Robert Toll, chief executive officer at Toll Brothers, said in a Dec. 3 statement. “We anticipate a gradual recovery in housing, similar to the one that occurred in the early 1990s.”
To contact the report on this story: Bob Willis in Washington at bwillis@bloomberg.net Last Updated: December 22, 2009 13:31 EST

Merger news, analyst upgrades drive stocks higher

By Stephen Bernard and Sara Lepro, AP Business Writers , On Monday December 21, 2009, 5:05 pm
NEW YORK (AP) -- Another wave of corporate dealmaking stoked investors' confidence in the economy and carried stocks sharply higher Monday.
Analyst upgrades of Alcoa Inc. and Intel Corp. and positive momentum on President Obama's health care overhaul also helped drive a broad advance on the stock market. Major indexes closed off their highs of the day but still rose about 1 percent. The Dow Jones industrial average jumped into the black for the month.
Bond prices tumbled as stocks rose, pushing the yield on the benchmark 10-year Treasury note up to its highest level since August. The dollar strengthened, hurting commodities prices.
Stocks got an early boost Monday after French drug maker Sanofi-Aventis SA announced plans to buy U.S. health care products company Chattem Inc. for $1.9 billion, while mining equipment maker Bucyrus International Inc. said it planned to buy Terex Corp.'s mining equipment division for $1.3 billion. Dutch automaker Spyker Cars submitted a new offer to buy Saab from General Motors Co.
Robert Pavlik, chief market strategist at Banyan Partners, said the flurry of corporate deal activity is an encouraging sign of strength in the economy.
"Companies are revealing that they are in a better position financially," he said. "If they weren't feeling as confident, you wouldn't see this type of activity occurring."
The deals announced Monday follow Exxon Mobil Corp.'s $29 billion takeover of XTO Energy Inc. last week.
In other corporate news, aluminum maker Alcoa Inc. announced an $11 billion joint venture in Saudi Arabia. The deal, along with an analyst's upgrade of the stock, drove Alcoa shares up nearly 8 percent, making it the best performer among the 30 stocks that make up the Dow.
An upgrade of chip maker Intel Corp. helped boost technology stocks, while health care stocks rose broadly as a historic health bill moved closer to passage in the Senate.
The Dow rose 85.25, or 0.8 percent, to 10,414.14, after rising as much as 130 points earlier in the day. The Standard & Poor's 500 index rose 11.58, or 1.1 percent, to 1,114.05, while the Nasdaq composite index rose 25.97, or 1.2 percent, at 2,237.66.
Bond prices sank as investors abandoned the safety of government debt in favor of stocks. The yield on the benchmark 10-year Treasury note, which moves opposite its price, climbed to 3.69 percent from 3.54 percent late Friday.
The dollar rose against other major currencies, making commodities more expensive for foreign buyers. Light, sweet crude for February delivery fell 70 cents to settle at $73.72 a barrel on the New York Mercantile Exchange. Gold also fell.
Monday's surge in stocks helped lift the Dow into positive territory for the month, giving it a 0.7 percent gain. Many analysts believe stocks should finish out the year strong after several weeks of listless trading.
Investors have been putting the brakes on stock buying since November, stepping back from the market following a historic rally over the past nine months. At the same time, prospects of an interest rate hike and a potential rebound in the dollar have dogged investors who spent the year taking advantage of low rates to borrow cheaply and invest in stocks and commodities.
Historically, December is the best single month for stocks, with the S&P 500 index averaging a 1.6 percent gain. So long as economic and corporate news continues to be encouraging, analysts expect the market to keep its momentum going into the new year.
Among the standout stocks, Chattem surged more than 33 percent, adding $23.16 to $93.14 after Sanofi-Aventis offered $93.50 a share for the company. Chattem, which is traded on the Nasdaq, helped lift that index to an intraday high for the year.
Alcoa shares shot up 7.9 percent after the announcement of the Saudi deal and Morgan Stanley's upgrade of the stock based on a forecast of higher aluminum prices. Shares jumped $1.15 to $15.73, after earlier hitting a 14-month high of $15.98.
About three stocks rose for every one that fell on the New York Stock Exchange, where volume was 1.01 billion shares compared with 3.16 billion shares at the same time on Friday.
Volume was exceptionally high Friday as several types of options contracts expired and S&P made changes to the S&P 500. That index is the basis for many indexed mutual funds, so those funds were forced to alter their holdings to match the reconstituted index.
In other trading, the Russell 2000 index of smaller companies rose 8.03, or 1.3 percent, to 618.60.
Overseas, Japan's Nikkei stock average rose 0.4 percent. Britain's FTSE 100 rose 1.9 percent, Germany's DAX index gained 1.7 percent, and France's CAC-40 jumped 2.1 percent.

Stocks rise to 2009 highs after Dubai

Stock market ticks higher after Dubai gets $10B bailout; Exxon deal lifts energy shares
By Sara Lepro, AP Business Writer
On 5:45 pm EST, Monday December 14, 2009

NEW YORK (AP) -- Easing concerns about debt problems overseas and a $29 billion takeover deal by Exxon Mobil Corp. nudged major stock indexes to new highs for the year.

AP - FILE - In this Nov. 27, 2009 file photo, traders move about the floor of the New York ...

The market climbed Monday after the Middle Eastern city-state of Abu Dhabi extended $10 billion to nearby Dubai to help the emirate make debt payments. Analysts have been concerned since last month that a cash crunch in the former boomtown could send ripples through global credit markets.
The market's advance was uneven after Exxon Mobil said it would acquire XTO Energy Inc. The move will help Exxon tap into the growing supply of natural gas in the U.S. and could signal that more deals are afoot in the energy industry.
A 4.3 percent drop in shares of Exxon held the Dow Jones industrial average to more modest gains than other indexes, and shaved about $2 billion off the value of Exxon's all-stock bid for XTO. The Dow added 0.3 percent, while the broader Standard & Poor's 500 index rose 0.7 percent.
Financial stocks rose after Citigroup Inc. said it would repay the $20 billion it received last year from the government's financial rescue program. The government also will sell its 34 percent stake in the company. The news came just days after Bank of America Corp. repaid the $45 billion in bailout money it owed taxpayers.
The day's advance was orderly and signaled that traders remain cautious, as they have for weeks. A big run in stocks that began in March has slowed in the past month as investors look to lock in some of their gains from 2009 and determine how to position themselves for the new year. The S&P 500 index is up 1.7 percent so far this month, after a 5.7 percent gain in November and a 64.7 percent jump since early March.
"Most people, for the most part, have wrapped up the year," said Blaze Tankersley, chief market strategist at brokerage Bay Crest Partners.
The Dow rose 29.55, or 0.3 percent, to 10,501.05, its highest close since Oct. 1, 2008. The S&P 500 index rose 7.70, or 0.7 percent, to 1,114.11, its highest finish since Oct. 2, 2008. The Nasdaq composite index rose 21.79, or 1 percent, to 2,212.10.
The yield on the benchmark 10-year Treasury note edged up to 3.56 percent from 3.55 percent late Friday as prices fell.
The dollar fell against other currencies, helping to lift most commodities prices. Commodities are priced in dollars and become cheaper for foreign buyers when the greenback falls.
Gold rose, while oil fell 36 cents to settle at $69.51 a barrel on the New York Mercantile Exchange.
Analysts said stocks are likely to drift as investors await comments about the economy and interest rates from the Federal Reserve, which wraps up its last policy meeting of the year on Wednesday.
Investors expect the central bank to keep its benchmark interest rate at a historic low level of near zero. But there is some concern that rates could rise sooner than previously thought as the economy improves.
"People simply want to know if we are going to keep this low-interest-rate environment," said Michael Feser, president of Zecco Trading in Pasadena, Calif. "That has really been fuel for this market."
The Russell 2000 index of smaller companies rose 9.42, or 1.6 percent, to 609.79.
Three stocks rose for every one that fell on the New York Stock Exchange, where consolidated volume came to 4.5 billion shares compared with 3.9 billion Friday.
Britain's FTSE 100 rose 1 percent, Germany's DAX index rose 0.8 percent, and France's CAC-40 gained 0.7 percent. Japan's Nikkei stock average fell less than 0.1 percent.

IRS to outline changes in the home buyer tax credit program

Revisions include expanded income limits, a cap on home prices, additional documentation requirements and prohibitions against claims by dependents.
By Kenneth R. Harney
December 6, 2009
Reporting from Washington - If you're thinking about applying for the new $6,500 home buyer federal tax credit or the extended $8,000 version, the Internal Revenue Service has just issued its first formal guidelines for you.Tops on the agency's list of advice: Cool it for a couple of weeks. Even if you qualify for one of the credits, don't send in any requests to the IRS quite yet. Wait until later this month when the agency publishes its revised Form 5405 with the key instructions needed to get you a check from the government.The forthcoming version of the form will incorporate the major changes to the tax credit program made by Congress in legislation signed by President Obama on Nov. 6. These include expanded income limits, a cap on home prices, additional documentation requirements and prohibitions against claims by dependents.In a tax bulletin issued just before Thanksgiving, the IRS emphasized that all home purchasers after Nov. 6 "must use this new version [of Form 5405] to claim the credit." Put another way: If you send in the old version -- the one you can currently download from the agency's website-- your request for the credit will probably go nowhere.The legislation -- known as the Worker, Homeownership and Business Assistance Act of 2009 -- extended the $8,000 first-time home purchaser credit until April 30 for signed contracts and June 30 for closings. The law also created a new tax credit for people who have owned a principal residence for a consecutive five of the previous eight years, and who purchase a replacement principal residence with a signed contract no later than April 30, followed by a closing no later than June 30.Qualified repeat buyers can obtain credits up to $6,500. For both the first-time and repeat buyer program, the credit is equal to 10% of the purchase price of the house, up to a maximum of either $6,500 or $8,000.The new IRS bulletin also outlined the agency's guidance on other important features of the amended credit program:* Members of the armed forces, as well as diplomatic and intelligence personnel serving in foreign countries, will get an extra year to buy a principal residence and still qualify for a credit. They will have until April 30, 2011, to enter into a contract to purchase a house, and until June 30, 2011, to close on it.* Anyone who buys a house after Nov. 6 -- even those who had intended to get in the door before the previous Nov. 30 expiration date for the $8,000 credit -- will now need to comply with several new rules. First, the house cannot cost more than $800,000. Second, no one under age 18 can claim the credit no matter what the circumstances. And finally, anyone who is counted as a dependent on another taxpayer's federal filings is ineligible for a home purchase tax credit.* The expanded income limits for purchasers after Nov. 6 range to $125,000 in "modified adjusted gross income" for single taxpayers and to $225,000 for those who file jointly. Singles with incomes between $125,000 and $145,000 may be eligible for reduced credit amounts, as are joint filers with incomes from $225,000 to $245,000. Anyone with an income above these amounts cannot qualify for either of the credits. Under the pre-Nov. 6 rules, taxpayers applying for the $8,000 credit were limited to incomes of $75,000 (single filer) to $150,000 (joint filer).The IRS continues to offer detailed consumer information resources on the credits, including questions and answers on a variety of home purchase scenarios.For example, some taxpayers seeking the extended $8,000 credit are uncertain about co-purchase and co-signing situations, especially involving parents and adult children. When a home-owning parent co-signs for a mortgage with a son or daughter, and both names appear on the note, can the son or daughter qualify for the first-time purchaser credit?The IRS says the parent clearly does not qualify for any portion of the credit since he or she already owns a principal residence. But if the son or daughter has not owned a house during the three years preceding the current purchase, and qualifies on income, he or she can be allocated the entire $8,000 credit.Similarly, when unmarried individuals co-purchase a house, and only one of them is eligible for the credit, the full $8,000 can be allocated to the eligible buyer.kenharney@earthlink.netDistributed by the Washington Post Writers Group.
Copyright © 2009, The Los Angeles Times

Stocks climb as falling dollar boosts commodities

Stocks rise as dollar slides; reports on housing, construction point to improving economy
By Tim Paradis and Ieva M. Augstums, AP Business Writers
On 3:45 pm EST, Tuesday December 1, 2009

NEW YORK (AP) -- The stock market is picking up where it left off before its scare over debt problems in Dubai.

AP - FILE - In this Nov. 27, 2009 file photo, Traders move about the floor of the New York ...
Major stock indicators rose more than 1 percent, including the Dow Jones industrial average, which jumped 120 points to send the Dow above 10,500 for the first time since October last year.
The weakening dollar again boosted stocks, a pattern that has played out for months. The cheaper U.S. currency drove up commodities prices and lifted the stocks of energy and materials companies that produce them.
Analysts said a mostly upbeat array of economic reports and easing worries about the fallout from debt struggles in Dubai gave investors who had jumped out of the market reason to return.
The market's two-day advance leaves the Dow where it was before tumbling Friday on worries that an investment fund in Dubai wouldn't be able to pay its debts and trigger another financial spiral like the one that followed the collapse of Lehman Brothers last year.
Rick Bensignor, chief market strategist at Execution LLC, said the drop in the dollar and a move into riskier assets is a sign that investors who jumped out of stocks or rushed into defensive positions are shedding worries of a wider debt problem from the Middle East.
"The market has essentially shaken it off," he said. "The whole move is as if nothing happened last week."
Economic reports were mixed, but still pointed to a strengthening trend in the economy. The Institute for Supply Management, a trade group, said overall manufacturing activity grew at a slower pace in November but that new orders rose. That signals activity could pick up in the coming months. Its employment measure grew for the second straight month after sliding for more than a year.
The snapshot of U.S. factories followed report from a Chinese industry group that said manufacturing activity grew in November for the ninth consecutive month.
Separately, the National Association of Realtors said its seasonally adjusted index of sales agreements rose in October to the strongest level since March 2006. Economists had expected the index would fall.
The government said construction spending edged higher in October, the first increase in six months.
The reports gave investors new confidence that a nearly nine-month rally in the stock market still has legs thanks to continued signs of expansion in the economy. The Dow jumped 6.5 percent in November, its best monthly gain since July, and it's up 58 percent from a 12-year low in March.
In late afternoon trading, the Dow rose 122.58, or 1.2 percent, to 10,467.42. The Standard & Poor's 500 index gained 12.55, or 1.2 percent, to 1,108.18, while the Nasdaq composite index rose 31.19, or 1.5 percent, to 2,175.79.
The ICE Futures U.S. dollar index, which measures the greenback against a basket of foreign currencies, fell 0.6 percent.
Crude oil rose $1.07 to $78.35 per barrel on the New York Mercantile Exchange. Gold rose.
Bob Froehlich, senior managing director at Hartford Financial Services, said the day's economic news addressed some of investors' biggest worries: employment, housing and China.
"What we're seeing is that we've got two of those three fixed," he said. "There are signs everywhere you look that the worst is behind us."
Froehlich said he expects the nation's unemployment rate, already above 10 percent, will worsen before it begins to improve.
Industrial names rose as commodities advanced after the reports on manufacturing and construction.
Aluminum producer Alcoa Inc. rose 25 cents, or 2 percent, to $12.77. It was one of the biggest gainers among the 30 stocks that make up the Dow industrials.
Freeport-McMoRan Copper & Gold Inc. rose $1.04, or 1.3 percent, to $83.84.
Energy stocks also rose. Schlumberger Ltd., which provides services to oil companies, rose $1.16, or 1.8 percent, to $65.05.
Home builders climbed on the day's economic reports. Beazer Homes USA Inc. advanced 13 cents, or 3 percent, to $4.43. Pulte Homes Inc. rose 20 cents, or 2.2 percent, to $9.34.
Richard Ross, global technical strategist at Auerbach Grayson in New York, said investors aren't willing to give up on the market's surge even if they have concerns it might be overdone.
"It speaks to that sort of bullish undercurrent," he said. "Whether it's misplaced optimism, that's another question."
Four stocks rose for every one that fell on the New York Stock Exchange, where volume came to 803.9 million shares compared with 751.2 million shares traded at the same point Monday.
The Russell 2000 index of smaller companies rose 8.27, or 1.4 percent, to 588.00.
Overseas markets jumped as fears eased about Dubai's credit problems. The emirate's government investment company said it was looking at restructuring part of its $60 billion in debt.
Japan's Nikkei stock average added 2.4 percent. Britain's FTSE 100 rose 2.3 percent, Germany's DAX index advanced 2.7 percent, and France's CAC-40 rose 2.6 percent.