- The Washington Times - Wednesday, December 27, 2006

NEW YORK (AP) — Wall Street surged higher yesterday, hurtling the Dow Jones Industrial Average past 12,500 for the first time as year-end bargain hunters picked up stocks across a variety of sectors.

The auto industry was in focus after a meeting between executives at Toyota Motor Corp. and Ford Motor Co. sparked hope about a potential alliance between the two rivals. Shares of both companies moved higher on the speculation.

Further takeover activity lent support to the overall market after McClatchy Co. announced late Tuesday that it agreed to sell the Star Tribune newspaper in Minneapolis to a private equity fund. Also, graphics communication company Cenveo Inc. said it would buy rival Cadmus Communications Corp.

But investors looking to buff up their portfolios by year’s end were behind most of the gains after major indexes languished last week.

“What you’re seeing is window dressing. People want to finish up the year looking like they own the best names,” said Philip S. Dow, managing director of equity strategy at RBC Dain Rauscher. “And for those that missed the market, they’re trying to put their cash to work and play catch-up. You’ve got momentum on your side this year.”

The session was marked again by thin volume typical of the week between Christmas and New Year’s. The New York Stock Exchange began the session with two minutes of silence as a tribute to former President Gerald R. Ford, while the Nasdaq Stock Market had a similar observance later in the morning.

The Dow rose 103 points, or 0.83 percent, to a closing record of 12,511. The index hit a record trading level of 12,519 earlier in the session.

Broader stock indicators also advanced. The Standard & Poor’s 500 Index was up 9.9, or 0.70 percent, at 1,427, and the Nasdaq Composite Index rose 17.7, or 0.73 percent, to 2,431.

The two-day advance leaves major indexes heading toward double-digit gains for the year. The Dow is now up 16.7 percent this year, while the Nasdaq has risen 10.2 percent and the S&P; 500 is up 14.3 percent.

Oil and natural gas continued to fall, continuing a drop of more than $1 on Tuesday on concerns a mild winter weather depressed demand for heating fuel. The price of a barrel of light sweet crude fell 76 cents to $60.34 on the New York Mercantile Exchange.

Shares of the biggest U.S. retail chains were higher despite a report from the International Council of Shopping Centers confirmed sales were not as strong in the pre-Christmas holiday shopping period. There is some hope among analysts that customers will pack stores to catch year-end sales.

Wal-Mart Stores Inc., the world’s largest retailer, rose 5 cents to $46.16. Federated Department Stores Inc. rose 58 cents to $38.34, while Target Corp. was up 38 cents at $57.47.

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