Stocks Reap Modest Gains

Wall Street extended its November rally on Monday, pushing the Dow Jones industrial average into the black for the first time since March and lifting broader indexes to fresh 4 1/2 -year highs.

Buyers remained in control even as oil prices rose from Friday’s five-month low. Stocks were helped by an upbeat report on an index designed to project the economy’s performance in three to six months.

The Dow rose 53.95 points, or 0.5%, to 10,820.28, its highest since March 10.

The Standard & Poor’s 500 and Nasdaq composite indexes both hit their highest levels since June 2001. Winners topped losers by 5 to 3 on the New York Stock Exchange, in moderate trading.

The market was buoyed in part by the latest reading of the index of leading economic indicators, which showed an upturn in October.

“The issue going forward is, can the economy keep growing, and I think the answer to that is yes,” said Alan Kral, who helps manage $750 million at Trevor Stewart Burton & Jacobson in New York. “Earnings will continue to grow and the market can continue to perform.”

After sliding in October the equity market has soared this month amid falling energy prices and a drop in long-term Treasury bond yields.

The Dow has gained nearly 600 points, or 5.8%, since Oct. 27. At Monday’s close the 30-stock index was up 0.4% year to date.

The broader S&P; 500, which rose 6.58 points, or 0.5%, to 1,254.85 on Monday, is up 3.5% this year; the technology-dominated Nasdaq composite, up 14.60 points, or 0.7% for the day, is up 3% for the year.

Indexes of small and mid-size stocks have led this month’s rally and exceeded blue-chip shares’ gains on Monday as well. A Standard & Poor’s index of 400 mid-sized stocks rose 0.9% to a record high, and is up 10.8% this year.

Some analysts, however, cautioned that the market could be volatile as investors brace for this weekend’s reports on holiday retail sales.

“You’re going to hear a lot of banter about [retail sales] this week because consumers are such a large part of the economy,” said Art Hogan, chief market analyst for Jefferies & Co.

In commodities trading Monday, oil prices inched up after sliding last week. Near-term crude futures in New York rose 49 cents to $57.70 a barrel.

But bond yields remained subdued. The 10-year Treasury note yield slipped to 4.46% from 4.49% on Friday.

Yields were higher on Friday after European Central Bank President Jean-Claude Trichet warned that the bank was likely to raise its benchmark interest rate soon, from a six-decade low of 2%.

On Monday, however, Trichet qualified that position, suggesting that a sustained rate-raising campaign wasn’t in the cards.

The dollar rallied on Trichet’s new comments, sending the euro down to $1.172 from $1.176 on Friday.

Among the day’s highlights:

* Boeing led the Dow higher, rallying $2.05, or 3.1%, to $69. The aircraft maker announced orders for 138 planes in two days from China and companies including International Lease Finance.

Also in the Dow, General Motors lost 47 cents to $23.58, giving up initial gains after reporting that it would close all or part of 12 North American facilities and slash 30,000 jobs.

* Retail stocks were mixed ahead of the big holiday weekend. Federated Department Stores slid $1.82 to $67.71, but Best Buy was up $1.14 to $47.05.

* Energy shares continued to rebound. Exxon Mobil jumped $1.12 to $59.37. ConocoPhillips increased $2.02 to $64.25.

* Merger offers riled some stocks. Mentor offered $2.2 billion in stock for Medicis Pharmaceutical, which refused the bid and said it was committed to its proposed takeover of Inamed.

Last week, Allergan outbid Medicis for Inamed with a $3.2-billion offer. Mentor dropped $4.79 to $51.35, Medicis surged $3.82 to $31.57, Allergan lost 65 cents to $99.60 and Inamed rose 2 cents to $83.33.

* Optimism about the economy may have spurred buying of steel stocks. U.S. Steel gained $2.04 to $40.66 and Nucor jumped $2.10 to $65.44.

* Home builders also were strong. KB Home surged $2.61 to $69.53, Ryland Group gained $2.27 to $73.70 and D.R. Horton was up $1.33 to $36.14.

* Microsoft helped pull Nasdaq higher, adding 9 cents to a 52-week high of $28.16. The stock has risen for eight straight sessions, and 14 of the last 16 sessions.