Stocks Climb, Dow Within Striking Distance of 10,000

NEWYou can now listen to Fox News articles!

Stocks headed higher Monday, with the Dow Jones industrials stopping 23 points short of the symbolic 10,000 level, as the United States' hunt for Usama bin Laden intensified in Afghanistan, feeding hopes for a speedy end to the war.

Upbeat corporate profit outlooks from companies such as the No. 2 home-improvement retailer Lowe's Cos. Inc. also boosted optimism the U.S. economy is near a rebound. Portfolio managers were switching money into stocks from low-return cash and bonds, helping to drive up volume, traders said.

The blue-chip Dow Jones industrial average climbed 109.47 points, or 1.11 percent, to end at 9,976.46, putting it more than 21 percent above its three-year low set on Sept. 21 and in bull-market territory, defined as at least a 20 percent gain from a recent low.

The technology-packed Nasdaq Composite Index climbed 35.84 points, or 1.89 percent, to 1,934.42 — its highest level since the Sept. 11 attacks on the United States. The index has surged more than 35 percent since September.

The broader Standard & Poor's 500 Index gained 12.41 points, or 1.09 percent, to 1,151.06. The S&P 500 has climbed 19 percent since Sept. 21.

"It seems as though we've got bin Laden within grasp and that is combined with the idea that earnings and the economy will get better in the second quarter of next year," said Jim Herrick, head of equity trading for Robert W. Baird & Co. "The trend is higher and money is coming into the market."

The United Stated scoured Afghanistan for bin Laden, the Muslim militant Washington blames for the Sept. 11 attacks on the United States that killed 4,500 people. The United Nations rushed to arrange talks over a future Afghan government as the Taliban, which had been sheltering bin Laden, crumbled.

Crude oil price fell to $17.72 a barrel in New York trading, briefly touching its lowest level in more than two years, as Russia refused requests from the Organization of Petroleum Exporting Countries to cut output. Lower oil prices are often seen as positive for the economy as they cut transportation and production costs, boosting profits for some firms.

But oil companies suffered. Exxon Mobil Corp., the No. 1 U.S. oil company, slipped 53 cents to $37.01.

Xerox Corp. was the NYSE's most-active stock after the struggling copier maker, which has been under heavy pressure to lighten its debt burden, signed an $800 million agreement for General Electric Co.'s GE Capital unit to provide equipment financing to Xerox customers in Canada and Europe. Xerox rose 72 cents to $7.30.

Lowe's climbed $2.75 to $43.10 after the company, which is the nation's biggest home-improvement chain after Home Depot Inc, reported its earnings jumped 24 percent. The news helped underpin optimism that consumers are remaining confident and continuing to spend. Home Depot gained $1.27 to $47.07.

E-business software maker PeopleSoft Inc. tacked on $3.69 to $36.05. The company said a robust outlook for orders has put it on target to meet earnings guidance despite the global economic slowdown.

A mega-merger between two oil heavyweights grabbed the spotlight. Phillips Petroleum Co. will pay $15.2 billion in stock for Conoco Inc., to become the No. 1 U.S. refiner. Phillips added $1.53 to $53.35, while Conoco rose $1.68 to $25.98.

Handheld digital device makers Palm Inc. and Handspring Inc., gained after The Wall Street Journal said some pundits hope the recent departure of Palm's chief executive could pave the way for talks on a merger between the two companies. Palm rose 44 cents to $3.87 and Handspring advanced $1.41 to $5.41.

Telecom equipment maker Lucent Technologies Inc. rose 38 cents to $8.59. Japan's top fiber-optic parts maker, Furukawa Electric Co. , sealed a deal to buy Lucent's fiber-optics unit for $2.3 billion.

Drugmaker Pharmacia Corp. rallied $3.85 to $45.20. The company won earlier-than-expected U.S. regulatory approval for its new arthritis drug Bextra, a follow-up to its popular painkiller Celebrex.

Progress in the war and hopes for an economic bounce in 2002 have buoyed the market in the last few weeks. But Wall Street is still debating whether stocks have gained too much speed in the face of a looming recession and dwindling corporate profits.

"I think the market may be ahead of itself. I would say sometime shortly we will begin to see a moderate correction in the market," said Stanley Nabi, managing director at Credit Suisse Asset Management, which oversees $100 billion.

"But having said that," Nabi added, "I am still an optimist and I believe that selective buying in this market is indicated here."

Signs of the lagging economy still abound. Alcoa Inc. , the world's largest aluminum producer, will cut 6,500 jobs, or 4.6 percent of its work force, and close plants to streamline operations amid low metal prices. Alcoa rose $1.37 to $38.49.

Advancing stocks beat out decliners by a ratio of 19 to 11 on the New York Stock Exchange and 11 to 7 on Nasdaq. Trading was active, with almost 1.3 billion shares changing hands on the Big Board and about 1.9 billion traded on Nasdaq.

Traders said volume later this week will be light, which could heighten market volatility, as portfolio managers and other investors head out for the Thanksgiving holiday, to be observed Thursday. The stock market will also shut early on Friday at 1 p.m. EST.

The Russell 2000 index rose 1.66 to 452.97.

Overseas, Japan's Nikkei stock average rose 0.7 percent. In Europe, Germany's DAX index was up 2.3 percent, Britain's FT-SE 100 was up 0.9 percent, and France's CAC-40 gained 1.6 percent.

Reuters and the Associated Press contributed to this report.