Stocks sharply higher on Boeing, tech forecast

NEW YORK - Industrial and technology stocks pulled the market sharply higher Tuesday after Boeing Co. said it was boosting production and an industry group forecast that demand for computers would increase.

The Dow Jones industrial average rose 213 points to its highest close since May 19 and made its third advance in four days. Major stock indexes rose more than 2 percent.

Industrials made some of the biggest moves after upbeat news from Boeing Co. and Illinois Tool Works Inc. Boeing rose 4 percent after increasing production of the 737 jet. Boeing, which has helicopter operations in Delaware County, said customers were adding to current orders and placing new ones. Illinois Tool Works rose about 2.5 percent after it raised the lower end of its fiscal second-quarter earnings target.

More good news on industrials came from the New York Federal Reserve, which said regional manufacturing expanded for an 11th straight month in June.

"We're still seeing factories and manufacturing help provide a little stimulus for the economy here," said Michael Church, president at Addison Capital Group in Philadelphia.

Technology stocks got a boost after research firm International Data Corp. raised its forecast for personal-computer shipments for 2010. IDC said shipments would be up almost 20 percent from 2010, compared with the forecast of a 15 percent increase made in April. Microsoft Corp. rose 4.3 percent and Hewlett Packard Co. rose 2.4 percent.

Investors are also ready to punish stocks of companies that have disappointing news. Best Buy Co. fell 6.1 percent Tuesday after the electronics chain posted weaker-than-expected earnings.

The Dow rose 213.88, or 2.1 percent, to 10,404.77. The broader Standard & Poor's 500 index rose 25.60, or 2.4 percent, to 1,115.23. The S&P 500 moved above its average close of the past 200 days, 1,108. The 200-day moving average is a technical level many traders watch. Pushing above that is seen as a sign of strength in the market. Gains in stocks faded Monday in part after the S&P 500 index failed to top the mark.

The tech-dominated Nasdaq composite index rose 61.92, or 2.8 percent, to 2,305.88.

Bond prices fell and drove up interest rates after stocks climbed.

Shares of BP P.L.C. rose 73 cents, or 2.4 percent, to $31.40 after falling 10 percent Monday when concerns grew about stepped-up U.S. political pressure to set aside money for costs related to the Gulf of Mexico oil spill that began April 20 when a rig operated by BP exploded. On Tuesday, credit ratings agency Fitch cut its rating on the oil company's debt. Fitch cited concerns about rising costs tied to the spill.