While a Commerce Department report showed US consumer spending dropped 0.1 percent in May, reports earlier this week showed the economy grew more than forecast in the first quarter.
Leading economic indicators and home sales also gained more than expected.
"The underlying economic story is okay," said Elizabeth Miller, who helps oversee US$750 million at Trevor Stewart Burton & Jacobsen Inc. "The market should certainly follow. If you really look long-term, the stock market and the economy will move in step together."
Alcan Inc jumped US$1.08 to US$37.52. The world's second-biggest aluminum maker said it expects second-quarter profit at the upper end of its range of US$0.35 to US$0.45 a share. Larger rival Alcoa Inc gained US$1.17 to US$33.15.
All 13 members in the Philadelphia Forest & Paper Products Index rose. International Paper climbed US$1.26 to US$43.58, Temple-Inland Inc advanced US$1.27 to US$57.86 and Weyerhaeuser Co gained US$0.89 to US$63.85.
AT&T had the biggest gain in the Dow, rising US$0.80, or 8.1 percent, to US$10.70, and Sprint Corp surged US$1.01 to US$10.61. Both stand to gain customers from WorldCom.
SBC Communications Inc rose US$0.35 to US$30.50. The second-largest long-distance company in the US is selling its 20 percent stake in Bell Canada to BCE Inc for US$4.17 billion.
RSS