Stocks advanced for the second day in a row Thursday, reflecting upbeat earnings reports by Qualcomm and Xerox and a better-than-expected report on first-time claims for unemployment compensation.
After the close of regular trading, shares of software developer Microsoft, a component of the Dow Jones industrial average, climbed 4 percent. The company delivered better-than-expected quarterly results and issued an upbeat forecast.
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Chief Financial Officer Chris Liddell said, “We have not seen any significant spillover from the economic slowdown in the U.S.”
On Friday, Peoria-based heavy equipment-maker Caterpillar is scheduled to post fourth-quarter results. Three months ago, Caterpillar was one of the first non-financial Dow stocks to say the housing slump was deepening and hurting its business broadly.
Analysts surveyed by StarMine expect Caterpillar earned $1.50 a share, up from $1.32 in the fourth quarter of 2006.
An agreement between the White House and Congress for a $150 billion economic stimulus package helped lift shares of home builders and boosted commodity prices.
The Dow Jones industrial average rose 108.44 points, to 12,378.61.
Exxon Mobil was the biggest contributor to the gain. Wal-Mart Stores was the biggest loser.
Toll Brothers, a builder of high-priced homes, gained nearly 6 percent, to $21.72, on top of a 13.6 percent rally Wednesday. The economic stimulus agreement includes a temporary increase in the size of home mortgages that Fannie Mae and Freddie Mac may buy.
Treasury securities lost ground in the wake of the stock market advance and stimulus package.
Crude oil for March delivery gained $2.42 a barrel, to $89.41. Gold climbed back above the $900-an-ounce mark. Gold for February delivery rose $23, to $905.50.