Dow Tops 10,000 as Stocks Rise on Positive Home Sales Data, Forecasts

Stocks climbed for a second straight session Monday, with the Dow Jones industrial average closing back above the key 10,000 level as red-hot home sales data yanked attention away from accounting scandals.

Wall Street was buoyed by a wide range of upbeat corporate forecasts from the likes of wireless technology firm Qualcomm, home products retailer Williams-Sonoma and auto maker General Motors.

“There are positives out there that you just haven’t seen recently,” said Barry Berman, head of equity trading for Robert W. Baird & Co. “The existing home sales data bode well for other economic reports coming out later this week.”

The Dow industrials jumped 177.56 points, or 1.8%, to 10,145.71--its highest level since the second week of January.

The Standard & Poor’s 500 index rose 19.59 points, or 1.8%, to 1,109.43, its largest daily percentage gain since early December. The Nasdaq composite index surged 45.34 points, or 2.6%, to 1,769.88, its biggest one-day percentage gain since Jan. 3.

Winners led losers by almost 5 to 4 on Nasdaq and by about 3 to 2 on the New York Stock Exchange in active trading.

Monday’s advance pushed the Dow into positive territory for the year--up 1.2% year-to-date. The S&P; 500 and Nasdaq remain mired in the red, however, down 3.4% and 9.3% for the year, respectively.

As the market’s concern about corporate accounting subsides, “the focus will be on economic data, and the data continue to suggest we are in recovery and the recession is behind us,” said Peter Cardillo, chief strategist at Global Partners Securities Inc.

The latest numbers showed sales of U.S. existing homes soared by a record 16.2% in January to an annual pace of 6 million units, due to mild weather and rebounding consumer confidence. Analysts polled by Reuters had predicted an annual pace of 5.3 million units.

“The housing market continues to stay strong despite the weak jobs market, and that’s really good news,” Cardillo said.

The report sparked a rally in home builders’ stocks. KB Home gained $1.78 to $41.84, D.R. Horton rose $1.03 to $37.34 and Centex rose $2.13 to $55.43. The Bloomberg index of home builders’ stocks gained 2.1%.

GM climbed $2.37 to $55.48 after the auto maker raised its estimates for first-quarter and full-year earnings and production schedules, citing better-than-expected sales in the United States. GM also said there were signs the U.S. economy is recovering from recession.

Qualcomm rose $3.21 to $35.91. The wireless-technology vendor reported better-than-expected demand for its cell phone chips, easing jitters about the company and the industry’s health. And retailer Williams-Sonoma, up $1.06 at $45.15, boosted its fiscal 2001 earnings outlook, citing cost controls and products that appealed to consumers eager to spend money on their living space.

Wall Street’s rally came on the heels of a strong day on European bourses. In Germany, stocks gained 2.5%, while shares in Britain advanced 1% and the market in France rose 1.4%.

In other market highlights:

* TRW rose a penny to $50.31 in its second day of trading after Northrop Grumman offered to buy it for $47 a share in stock. TRW shares rose 26% on Friday, the day the bid was announced. Northrop Grumman’s stock slid $1.51 to $108.44 Monday.

* Home improvement retailer Lowe’s rose $1.44 to $47.49 after reporting a jump in quarterly profit and saying fiscal 2002 earnings would top current estimates. Rival Home Depot, a Dow stock, added $1.07 to $52.07.

* Caterpillar surged $3.38 to $56.06. The tractor maker’s first-quarter earnings are expected to be better than expected, the company told Barron’s.

Tyco International rose $2 to $29.50 after the company said a court dismissed shareholder claims that Tyco inflated profits through accounting maneuvers.

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Market Roundup, C8-9