4 Feb 2009

Wall Street notches up solid gains

11:56 am on 4 February 2009

US stocks closed solidly higher on Tuesday as investors weighed a mixed batch of corporate earnings and progress on the government's stimulus plan.

The Dow Jones industrial average jumped 141.53 points, or 1.78%, to 8,078.36.

The Standard & Poor's 500 Index added 13.07 points, or 1.58%, to 838.51.

The Nasdaq Composite Index shot up 21.87 points, or 1.46%, to 1,516.30.

News of an alternative stimulus plan from Senate Republicans suggested lawmakers were moving closer to a package that would soften the blow of a deepening recession.

A group of Republican U.S. senators offered a $US445 billion alternative plan to boosting the ailing economy, about half of which would be in the form of tax cuts.

The plan is an alternative to the $US885 billion package crafted by Democrats who control the Senate.

A surprise rise in December pending home sales also buoyed sentiment, while a solid profit from drugmaker Merck offered a rare bit of welcome news in an otherwise gloomy earnings season.

Merck shares climbed more than 6%, making health-care stocks one of the biggest boosts to both the Dow and the S&P 500.