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Stocks move higher in early trading

September 17, 2009|Associated Press

NEW YORK — Investors barreled into stocks Wednesday after an upbeat report on industrial production raised hopes that the economy was strengthening.

The Dow Jones industrial average rose 108 points to another high for the year. It was the market's eighth gain in nine days.

The Federal Reserve said industrial output surged 0.8% in August, more than expected. The Fed also said July's increase in production was twice what was initially reported.

The report lifted shares of manufacturing companies such as aluminum producer Alcoa, which gained 3.4%.

The Dow rose 108.30 points, or 1.1%, to 9,791.71, its highest close since Oct. 6, when it ended at 9,956. The index is up 12% for the year.

The broader Standard & Poor's 500 index gained 16.13 points, or 1.5%, to 1,068.76, while the Nasdaq composite index rose 30.51 points, or 1.5%, to 2,133.15.

The Russell 2,000 index of smaller companies rose 2.1%.

Five stocks rose for every one that fell on the New York Stock Exchange.

Shares of General Electric surged 6.3%, erasing their loss for the year. The company plans today to update analysts on its business.

Shares of health insurers rose after Senate Finance Committee Chairman Max Baucus (D-Mont.) introduced a bill to revamp the nation's healthcare system. The measure would require most people to purchase insurance coverage and prevent insurance companies from charging higher premiums for people with more serious medical problems.

UnitedHealth Group jumped 5.7%, while Humana advanced 4.9%.

Shares of home builders surged after an index of industry confidence rose for the third straight month. Beazer Homes shot up 14%. Hovnanian Enterprises rose 10%.

Newspaper stocks rallied on a report that suggested the erosion in advertising spending was slowing. Gannett advanced 10.3%, while New York Times climbed 12%.

The Treasury bond market was mixed. The yield on the benchmark 10-year T-note rose to 3.47% from 3.45% late Tuesday.

Commodities rallied again as the dollar extended its slide. Gold shot up $13.90 to a record $1,018.90 an ounce.

Oil advanced after the government reported a large drop in crude supplies. Crude futures rose $1.58 to settle at $72.51 a barrel on the New York Mercantile Exchange.

Overseas, key stock indexes rose 1.6% in Britain, 1.3% in Germany, 1.6% in France and 0.5% in Japan.

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