By Kristina Peterson
NEW YORK (MarketWatch) -- U.S. stocks on Monday extended gains
into a fourth straight week after the group in charge of dating the
start and end of downturns declared the U.S. recession ended last
summer.
"It doesn't mean growth is robust, but it is growth," Paul
Nolte, managing director at Dearborn Partners, said of Monday's
declaration by the National Bureau of Economic Research that the
longest U.S. recession since World War II ended in June 2009.
Not far from session highs, the Dow Jones Industrial Average
(DJI) was up 107.43 points, or 1%, to 10,715.28.
All but one of the Dow's 30 components rose, including
International Business Machines Corp. (IBM), up 1%, after the
company said it would buy business-software firm Netezza Corp. (NZ)
for $1.7 billion.
"Companies are flush with cash and valuations are pretty cheap,
so I would think M&A is only going to accelerate for the next
six months," said Maris Ogg, president at Tower Bridge
Advisors.
The S&P 500 (SPX) gained 11.82 points, or 1.1%, to 1,137.41,
with consumer discretionary leading gains among its 10 industry
groups.
The Nasdaq Composite Index (RIXF) advanced 25.92 points, or
1.1%, to 2,341.53.
Roughly four stocks rose for every one on the decline on the New
York Stock Exchange, where 456 million shares had been exchanged as
of 2 p.m. Eastern.
The NBER report propelled the S&P 500 past levels not
breached since May, with investor sentiment already bolstered by
home-builder Lennar Corp. (LEN) topping forecasts, reporting a
better-than-expected quarterly profit and a drop in orders that
proved less dreary as experienced by others in its industry.
The National Association of Home Builders on Monday reported its
monthly index of builders' sentiment remained unchanged in
September at an 18-month low. Read more about builders'
sentiment.
In its report, the NBER cautioned that its finding did not
represent a forecast about the future, saying if another downturn
occurs it would represent a separate recession -- a scenario viewed
as unlikely by most economists.
Investor sentiment has turned "more positive because the
economic news has been better than feared, so it's more a sigh of
relief," Ogg said of Wall Street's recent climb.