NEW YORK – U.S. stocks rallied on Thursday, with the Dow hitting a fresh 4 1/2-year high, as computer and printer maker Hewlett-Packard Co. (HPQ) and retailer J.C. Penney Co. Inc. (JCP) after both posted earnings that beat Wall Street expectations.
Shares of Hewlett-Packard, a Dow component, jumped 7.4 percent to $34.02 for the biggest one-day gain in six months, after earlier hitting a 5-year high at $34.51 on the New York Stock Exchange. HP provided the biggest lift to both the Dow average and the broader Standard & Poor's 500 Index.
"HP came out with some good earnings, taking the tech sector higher," said Dan McMahon, head of listed trading at CIBC World Markets Inc. "The trend is decidedly upward. It's just a matter of trying to sustain it."
The Dow Jones industrial average rose 61.71 points, or 0.56 percent, to end at 11,120.68, after earlier touching a fresh 4 1/2-year high at 11,120.76. The Standard & Poor's 500 Index gained 9.38 points, or 0.73 percent, to finish at 1,289.38. The Nasdaq Composite Index climbed 18.20 points, or 0.80 percent, to close at 2,294.63, its high for the day.
The Dow has closed higher for seven of the last nine sessions. The S&P 500 and the Nasdaq Composite have risen for the past three days, the longest winning streak for both indexes this month.
After the closing bell, Hewlett-Packard rival Dell Inc. (DELL) also reported profit that topped analysts' estimates, but forecast first-quarter results below Wall Street expectations.
Shares of Dell, the world's largest personal computer maker, slipped 1 percent, or 31 cents, to $31.65 in extended-hours trading from a close at $31.96 on Nasdaq. Initially, Dell's stock rose to $32.50 just after its results were released.
In economic news, housing starts rose in January by the most in nearly 33 years, buoying the home building sector.
The Dow Jones U.S. home builder index rose 1.6
percent, its third straight day of gains, with all but two of the 16 stocks in the index rising by at least 1 percent on the day.
Shares of D.R. Horton Inc., the largest U.S. home builder, climbed 3.3 percent, or $1.11, to $35.03, while shares of luxury home builder Toll Brothers added 2.3 percent, or 69 cents, to $30.57.
J.C. Penney, a department store operator and an online retailer, reported earnings above analysts' estimates. The company gave a positive outlook and said it would increase its dividend and buy back stock, sending its shares up 2.2 percent, or $1.22, to $57.85.
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Among the Nasdaq's major gainers, Network Appliance Inc. shares jumped 7.8 percent, or $2.42, to $33.58, a day after the company said its quarterly profit rose more than expected on growing demand for its mid-priced data storage products.
Some of Thursday's biggest decliners included XM Satellite Radio Holdings Inc. and Expedia Inc.
XM Satellite fell 5 percent, or $1.27, to $23.98 on Nasdaq after the company reported a wider quarterly loss and a director resigned.
Federal Chairman Ben Bernanke, in the second day of congressional testimony, repeated his Wednesday comments suggesting that more interest-rate increases may be needed to contain inflation.
Trading was moderate on the NYSE, with about 1.66 billion shares changing hands, above last year's daily average of 1.61 billion, while on Nasdaq, about 2.01 billion shares traded, above last year's daily average of 1.80 billion.
Advancing stocks outnumbered declining ones by a ratio of almost 5 to 2 on the NYSE and by about 9 to 5 on Nasdaq.