Stocks Close Higher, Lifted by Stimulus Pact
Stocks closed slightly higher as Wall Street welcomed news that House-Senate negotiators had reached agreement on an economic stimulus bill.
Congress and the Obama administration reached a deal on a $789 billion economic stimulus packagethat would mix tax cuts and new government spending to rescue the faltering economy.
Senate majority leader Harry Reid told reporters negotiators had "bridged differences" between an $820 billion dollar House version of the package and an $838 billion version passed by the Senate.
The major averages had been slightly lower prior to the news, which gave the market a modest jolt as big banks paved the way.
Wells Fargo and Bank of America led the financials' rally, though gains were limited by a drop in oil prices and weakness in some key technology names.
At the same time, ExxonMobil led Dow losers as oil prices closed below $37.
Also, BlackBerry maker Research in Motionreleased an outlook that disappointed investors. The company said its quarterly earnings and gross margins could come in at the low end of expectations, sending shares down sharply and causing the most damage to the Nasdaq tech gauge.
Elsewhere on the index, Intel fell as the company announced a $7 billion upgrade to three of its US plants, and Nvidia tumbled after the chipmaker disclosed a big fourth-quarter loss and a dim outlook for the first quarter, following trading Tuesday.
Also sharply higher was Sanofi Aventis, whose earnings dropped 76 percent on a charge, but were better than expectations.
Financial-related companies led Dow gainers as the SPDR Financial exchange-traded fund gained more than 2 percent higher. Outside the space, Microsoft was the leading gainer among the bluechips.
Though it is a penny stock, SiriusXM was drawing investor attention after the New York Times reported the company is considering filing for bankruptcy. Separately, satellite mogul Charles Ergen has offered to inject several hundred million dollars of capital into the company but will not be buying out existing shareholders, according to the Wall Street Journal.
Markets in Europe and Asia were mostly lower, with money flowing into government bonds.
In the only significant economic report of the day, the US trade deficit fell to its lowest level in six years at $39.9 billion, still bigger than analyst estimates of $36 billion.
In European earnings, Credit Suisse reported its largest-ever annual loss after bad trading performance and restructuring charges, but also said it is off to a strong start this year.
ArcelorMittal, the world's top steel company, reported its first-ever loss.
Market breadth was positive, with gainers beating losers 1.7 to 1 on light volume.