IBM upgrade fuels rise on Wall Street

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By Hope Yen
Associated Press

NEW YORK — Wall Street extended its advance into a sixth straight week today after a brokerage upgrade of IBM raised investor expectations of a rebounding economy. The Nasdaq composite reached an 18-month high.

"What's driving things today is you're continuing to see upgrades and better earnings out of technology from companies such as IBM," said Russ Koesterich, U.S. equity strategist at State Street Corp. in Boston.

The Nasdaq gained 30.41, or 1.6 percent, to 1,888.65, following a weekly advance of 2.6 percent. It was the highest closing level since March 12, 2002, when the tech-focused index stood at 1,897.12.

The blue chips also finished higher. The Dow Jones industrial average closed up 82.95, or 0.9 percent, at 9,586.29. Last week, the blue chips gained 0.9 percent to post their fifth straight winning week despite an 84-point loss Friday on a weak employment report.

And the Standard & Poor's 500 index rose 10.25, or 1 percent, to 1,031.64, having risen 1.3 percent last week. Today's close represented a 14-month high.

International Business Machines Corp. climbed $2.15 to $89.10 after Credit Suisse First Boston upgraded the computer company's stock rating to "outperform" from "neutral."

Stocks have climbed in recent weeks on growing investor expectations of a strong economic recovery. But analysts caution that the market might be due for pullbacks after advancing so quickly, particularly when companies begin issuing earnings warnings later this month.

Advancing issues outnumbered decliners about 5 to 2 on the New York Stock Exchange. Volume was moderate.

Overseas, Japan's Nikkei stock average finished 0.3 percent higher today. In Europe, France's CAC-40 rose 0.5 percent, Britain's FTSE 100 gained 0.8 percent and Germany's DAX index advanced 0.9 percent.