- The Washington Times - Wednesday, September 27, 2006

NEW YORK (AP) — Wall Street advanced for a third-straight session yesterday, although the Dow Jones Industrial Average fell just short of touching its record high close after a jump in oil prices stifled investors’ enthusiasm.

Falling crude oil prices and an increase in new home sales had helped investors shrug off a weak durable goods report earlier in the session, putting the Dow just 2.21 points away from the closing record of 11,722.98 it set on Jan. 14, 2000.

“I think most of the activity is this push to make a close at all-time highs,” Ryan Larson, senior equity trader at Voyageur Asset Management, said of much of yesterday’s early movement. He contends Wall Street’s expectation that it would surpass the record drove stocks before investors grew wary in part by the rise in oil prices.

“I think it was a little bit exhausted,” he said of the idea of a record-breaking day. He said, however, that the market’s gains shouldn’t be ignored and that optimism remains.

The Dow closed up 19.85, or 0.17 percent, at 11,689.24, its second-best close ever. The Dow has gained 181.14 points over the past three sessions.

Broader stock indicators also moved higher. The Standard & Poor’s 500 Index rose 0.25, or 0.02 percent, to 1,336.59, and the Nasdaq Composite Index advanced 2.05, or 0.09 percent, to 2,263.39.

The Commerce Department said yesterday that orders to U.S. factories for large manufactured goods fell for a second straight month in August, the first time in more than two years there has been a consecutive decline. Demand for durable goods dropped 0.5 percent last month to $209.7 billion.

Some good news came in a report that new home sales rose 4.1 percent in August, their biggest increase in five months. The Commerce Department data raised hopes that a sharp decline in the housing industry could be easing.

Light crude settled up $1.95 at $62.96 a barrel on the New York Mercantile Exchange.

Bonds fell, with the yield on the benchmark 10-year Treasury note rising to 4.59 percent from 4.58 percent late Tuesday.

Several Dow components reported good news yesterday, though it wasn’t enough to push the blue-chip average to new highs. McDonald’s Corp. rose to a six-year high, advancing 76 cents to $39.82, after saying it would boost its dividend 49 percent to $1 from 67 cents.

Another Dow component, Merck & Co., rose 64 cents to $42.40 after scoring another victory in its legal battle over its painkiller Vioxx. A federal jury determined after a two-week trial that there wasn’t sufficient evidence to link Vioxx to a Kentucky man’s heart attack in 2003. Though it was a win for Merck, thousands of cases are still pending over the drug.

Red Hat Inc., the largest distributor of the open-source Linux operating system, fell $6.11, or 23.21 percent, to $20.21 following analyst downgrades to the stocks after a disappointing second quarter.

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