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Saturday, September 25, 2010

WALL STREET >>> DJIA Defeats 10850 Level

Bulls Come Back with a Vengeance
Stocks resumed their September run higher today, with encouraging data from across the pond providing an early lift.
More specifically, Germany's closely watched gauge of business sentiment unexpectedly rose to a three-year peak in September, easing concerns about the fiscal health of the euro zone. On the home front, though, the Street had its own dose of upbeat data to celebrate, courtesy of the Commerce Department. Along with an upwardly revised reading for durable-goods orders in July, Uncle Sam said orders for core capital goods rose 4.1% in August, compared to a decline of 5.3% in the month prior. The latest figures pointed toward improving capital spending habits among U.S. businesses, and helped to overshadow a relatively lackluster housing report.

Against this backdrop, the Dow Jones Industrial Average spent the session basking in triple-digit-gain glory, with the major market indexes extending their winning streak to four straight weeks.

"So much for falling back into the range," commented a senior Wall Street dealer. Referring to the recent crop of solid earnings reports, most analysts said they are encouraged that the broad-market rally could have more gas in the tank.
"If this is a preview of the upcoming third-quarter earnings season, we could be in for more solid data – which would confirm that all the talk of a double-dip recession was extremely overblown," he said.

The Dow Jones Industrial Average (DJIA – 10,860.26) skyrocketed nearly 198 points, or 1.9%, today, marking the blue chips' best session since Sept. 1. In fact, all of the Dow's 30 components settled north of breakeven, with Caterpillar Inc. (CAT) paving the path higher on the heels of a price-target boost from Credit Suisse. Thanks to today's triple-digit surge, the Dow not only reclaimed its foothold atop the 10,700 level, but also finished atop the 10,850 level for the first time since mid-May. For the week, the blue chip barometer tacked on 2.4%, extending its month-to-date advance to 8.4% - on pace for the best September in 71 years.

In similar fashion, the S&P 500 Index (SPX – 1,148.67) rallied 23.8 points, or 2.1%, though the index's surge was stopped short at the 1,150 level.

Meanwhile, the Nasdaq Composite (COMP – 2,381.22) fared the best of the three, tacking on an impressive 54.1 points, or 2.3%, to end its second consecutive week atop its 20-week trendline. For the week, the SPX gained 2.1%, while the tech-rich COMP powered 2.8% higher.

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