Stocks closed higher Wednesday after Federal Reserve Chairman Alan Greenspan delivered an upbeat assessment of the economy and oil dipped below $57 a barrel.
The Dow Jones Industrial Average rose 42.59, or 0.4 percent, to 10,689.15. The Standard & Poor's 500 rose 5.85, or 0.5 percent, to 1,235.20, its best close since July 2, 2001. The Nasdaq Composite Index rose 15.39, or 0.7 percent, to 2,188.57, moving into positive territory for the year and reaching its highest point since June 18, 2001.
Greenspan said in an appearance before Congress that the economy should enjoy sustained growth with low inflation in coming months. And he made clear that the Federal Reserve Board would continue raising interest rates at the same gradual pace it has for the past year.
Oil prices fell after new government data showed rising U.S. supplies of diesel and heating oil and a smaller-than-expected decline in crude oil inventories. U.S. light, sweet crude oil futures settled down 74 cents to $56.72 a barrel, after dropping as low as $56.10, the lowest since June 30.
Among local movers, shares of Amgen Inc. jumped 15.1 percent to $81.17 after the Thousand Oaks-based biotechnology company beat analysts' expectations for second-quarter earnings and raised its financial outlook for the year. Amgen said late Tuesday that net income rose to $1 billion (82 cents per diluted share). Analysts had forecast earnings of 72 cents per share. Also, the company said it now expects to earn between $3.10 and $3.20 per share in 2005, up from previous guidance.
And j2 Global Communications Inc. gained 1.9 percent to $36.59 after the L.A.-based messaging and communications services provider stock was rated "buy" in new coverage by analyst Frank Marsala at First Albany Corp. The price target was set at $44 per share.
On the down side, shares of Jakks Pacific Inc. lost 6.9 percent to $18.66 after the Malibu-based toymaker matched analysts' earnings estimates of 39 cents per share and came in under its revenue forecast. Revenue for the second quarter rose to $127.1 million, just shy of the $135.6 million estimate.
And Computer Sciences Corp. fell 1.2 percent to $45.97 after the El Segundo-based IT services company's stock rating was downgraded to "underperform" from "in-line" by analyst Gregory M. Gould at Goldman, Sachs & Co.
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