US stocks rallied, sending the Standard & Poor's 500 Index to its biggest gain in almost six weeks, as UN weapons inspectors pressed for more time to work in Iraq.
"A lot of traders feared bombing would start tomorrow, and there's no smoking gun here," said Jack Ablin, chief investment officer at Harris Trust & Savings Bank, which manages US$40 billion in Chicago.
Computer-related shares rose after Dell Computer Corp reported higher profits and forecast rising sales. They contributed one-quarter of the gain in the S&P 500, which climbed 17.52 to 834.89. The index's 2.1 percent advance was the largest since Jan. 6.
PHOTO: AP
The Dow Jones Industrial Average added 158.93, or 2.1 percent, to 7,908.80. The NASDAQ Composite Index added 32.73, or 2.6 percent, to 1,310.17. Stocks had fallen the three previous days as the US government warned citizens to prepare for possible new terrorist attacks and linked Iraq to the al-Qaeda terror network.
For the week, the S&P 500 and Dow gained 0.6 percent, while the NASDAQ advanced 2.2 percent. All three rose for the first week in five.
Stocks climbed as Hans Blix, the UN's chief inspector, told the Security Council that his staff wants more private interviews with Iraqi scientists and flights by U-2 spy planes next week.
Inspectors are seeking to determine whether Iraq has complied with UN disarmament demands.
France, Russia and China, which have vetoes in the Security Council, called for stepped-up inspections rather than the use of force.
"If Iraq is allowing U-2 flights next week, that suggests a more conciliatory tone, and will put off the combat for at least a few more days," Harris Bank's Ablin said. He's waiting on further developments before making changes in his portfolios.
More than three stocks rose for every two that fell on the New York Stock Exchange and the NASDAQ Stock Market. Some 1.36 billion shares traded on the Big Board, 1.3 percent more than the three-month daily average. More than 1.31 billion shares changed hands on the NASDAQ.
Exchanges are closed Monday for Presidents Day.
Dell had its biggest gain in nine months, surging US$2.52, or 11 percent, to US$25.77. The world's second-biggest personal-computer maker said fourth-quarter profit jumped 32 percent and sales will rise to US$9.5 billion this quarter.
"Dell came in with good numbers; that's very good for the market," said David Memmott, head of trading at Morgan Stanley, the world's largest securities firm by market value. "But this whole terrorist thing and Iraq is 95 percent of what the market's looking at right now."
Hewlett-Packard Co, Dell's larger rival, rose 84 cents to US$17.79. Intel Corp, the world's largest semiconductor maker, rose US$0.62 to US$16.15.
Nvidia Corp rallied US$2.17 to US$12.04. The maker of computer-graphics chips used in Microsoft Corp's Xbox video-game machine earned US$0.30 a share in the fourth quarter, topping the US$0.06 average forecast of analysts surveyed by Thomson First Call, as it settled a pricing dispute with the world's largest software maker.
Microsoft rose US$1.31 to US$48.30.
Analog Devices Inc climbed US$3.02 to US$26.90. The world's fourth-biggest maker of signal-processing chips, used in cell phones and electronics, said fiscal first-quarter profit more than doubled. Excluding some costs, the company earned 17 cents a share, beating analysts' average forecast by 1 cent.
InVision Technologies Inc rose US$0.57 to US$23.82. The maker of machines that detect explosives in airport luggage said fourth- quarter earnings rose sixfold, beating the average estimate of analysts polled by First Call.
Intuit Inc gained US$2.76 to US$44.43. The maker of software used to prepare income-tax returns earned 61 cents a share in the fiscal second quarter, excluding discontinued operations and costs such as amortization. On that basis, it beat analysts' average estimate by US$0.4.
A pair of economic reports helped stocks climb. US industrial production jumped 0.7 percent in January, the most in six months, the Federal Reserve said. Economists polled by Bloomberg News had forecast a 0.3 percent increase.
Business inventories rose for an eighth straight month, gaining 0.6 percent in December, a separate Commerce Department report showed, as companies replenished stockpiles to meet demand. The average forecast was for a 0.2 percent advance.
Universal Health Services Inc tumbled US$6.96 to US$34.99. The operator of acute-care and psychiatric hospitals fired Chief Financial Officer Kirk Gorman. Gorman said he told auditor KPMG LLP he was "confused" about whether he could certify company accounts because he didn't have the expertise to verify all the details. KPMG then went to the board. Bristol-Myers Squibb Co declined US$0.41 to US$21.99. Boehringer Ingelheim GmbH's AIDS drug Viramune is as effective as Bristol-Myers' Sustiva, a study found.
S&P 500 futures expiring in March rose 18 to 837 on the Chicago Mercantile Exchange. March futures on the NASDAQ-100 Index advanced 23.50 to 985. The index, a benchmark for NASDAQ's largest companies, gained 30.19, or 3.2 percent, to 982.09. NASDAQ-100 tracking shares, called Cubes because of their QQQ ticker symbol, rose US$0.55 to US$24.49. The S&P 500 shares known as Spiders gained US$1.80 to US$84.15.
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