2:41 PM
S&P rises, doubles its 2009 low
Addison Ray
By Rodrigo Campos
NEW YORK | Wed Feb 16, 2011 4:30pm EST
NEW YORK (Reuters) - The S&P 500 rose on Wednesday to twice its value from just two years ago, a bounce whose vigor has not been seen since the Great Depression.
Stocks were boosted by Dell earnings and deal announcements fueling hope for more gains, but light volume makes the recent move more tenuous.
The market overcame concerns about tensions between Israel and Iran, and indexes slowly climbed back to close near the session's high.
"It seems that there's just a lot of pent-up demand, and the market is very quick to shrug off news that could appear negative," said Angel Mata, managing director of listed equity trading at Stifel Nicolaus in Baltimore.
Still, volume struggled to match the year's average of 7.9 billion shares on the New York Stock Exchange, NYSE Amex and Nasdaq. About 7.5 billion shares changed hands on Wednesday.
The S&P 500 closed above 1,333.58, double the intraday low hit in early March 2009. On a closing level, the market has risen more than 96 percent since March 9, 2009 --a run not seen in such a short period of time since 1936, according to Howard Silverblatt, senior index analyst at Standard & Poor's.
The steep advance on relative low volume has sparked many forecasts for a correction.
"You have still a healthy degree of skeptics out there," Mata said. "You never want the market to be too bullish."
Dell Inc (DELL.O), the world's No. 2 personal computer maker after Hewlett-Packard, flew past Wall Street's profit and margins estimates late on Tuesday, and its shares jumped 11.9 percent to $15.56.
HP shares (HPQ.N) gained 2.1 percent to $48.99.
Two Iranian warships planned to sail through the Suez canal en route to Syria on Wednesday, an Israeli official said, calling it a "provocation" by the Islamic Republic.
The pullback following the comments was another opportunity for money on the sidelines to get back into stocks, Mata said.
The Dow Jones industrial average .DJI gained 61.53 points, or 0.50 percent, to 12,288.17. The Standard & Poor's 500 Index .SPX rose 8.31 points, or 0.63 percent, to 1,336.32. The Nasdaq Composite Index .IXIC added 21.21 points, or 0.76 percent, to 2,825.56.
Advancing stocks outnumbered declines on the NYSE by a ratio of 3 to 1. On the Nasdaq, more than nine stocks rose for every five that fell.
Crude and basic materials shares again gave the market direction, with the energy sector of the S&P 500 .GSPE up 1.3 percent and materials .GSPM up 1.2 percent.
