US stocks rallied, sending the Dow Jones Industrial Average to its biggest weekly gain in more than 20 years, as the US and UK attacked Baghdad by air and their ground troops moved into southern Iraq.
"The market has become a bellwether for success or disappointment in the Iraqi war," Henry Cavanna, who has worked on Wall Street for more than three decades and now runs Cavanna Capital Management, told Bloomberg Television. "This stock market is not a normal stock market right now. It's in a zone that's totally driven by one event."
The Dow rose 235.37, or 2.8 percent, to 8,521.97. Every member of the 30-stock average gained except SBC Communications Inc. The S&P 500 advanced 20.23, or 2.3 percent, to 895.90, led by General Electric Co and Pfizer Inc. The Dow and S&P 500 climbed for an eighth day and turned higher for the year.
The NASDAQ Composite Index added 19.07, or 1.4 percent, to 1,421.84.
For the week, the Dow climbed 8.4 percent, its largest gain since the five days ended Oct. 8, 1982. The S&P 500 rose 7.5 percent for the week, while the NASDAQ added 6 percent.
Year-to-date, the Dow has risen 2.2 percent and the S&P 500 has added 1.8 percent amid optimism the war will end in days or weeks and spark a recovery in consumer and business spending.
The NASDAQ has gained 6.5 percent.
"There is a prevailing thought process that the only thing sitting on the US economy is this war," said Matt Johnson, head of trading at Lehman Brothers Inc.
Stocks jumped after the BBC reported, citing a UK official, that Iraqi leader Saddam Hussein may have been killed. Admiral Sir Michael Boyce, the UK's chief of defense staff, said he's "not aware" whether Hussein was killed in initial air strikes on Baghdad.
* The NASDAQ Composite Index added 19.07, or 1.4 percent, to 1,421.84.
* he S&P 500 advanced 20.23, or 2.3 percent, to 895.90
* The Dow rose 235.37, or 2.8 percent, to 8,521.97.
Allied troops may be in Baghdad in three or four days, the BBC said, citing an unidentified UK military official. Allied ground troops pushed through southern Iraq in two broad columns.
One seized the region's oilfields and moved toward Basra, the second-largest city; the other headed toward Baghdad. Forty-five of the targets were homes or compounds thought to house Iraqi leaders and security forces, NBC News reported.
"There's relief so far that nothing really unexpected has happened in Iraq," said Eric Thorne, who helps manage US$1.7 billion at Bryn Mawr Trust Co in Philadelphia. "Everything is going according to plan."
He recently trimmed his position in diaper maker Kimberly-Clark Corp and is considering buying shares of Cisco Systems Inc, the largest maker of computer-networking equipment, and technology companies.
More than two stocks rose for every one that fell on the New York Stock Exchange while three advanced for every two that declined on the NASDAQ Stock Market.
About 1.81 billion shares traded on the Big Board, the most since Nov. 21, as trading increased amid the quarterly expiration of options on stocks and stock indexes, and of futures on stocks and stock indexes.
General Electric, the world's second most-valuable company after Microsoft Corp climbed US$1.15 to US$28. Pfizer, the world's biggest drugmaker, added US$1.16 to US$31.96.
General Electric, which owns the NBC television network, and other media companies gained on optimism a short war wouldn't disrupt advertising revenue as much as some investors had expected, said Jeffrey Logsdon, analyst at Gerard Klauer Mattison & Co.
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