RTRS: Dow, S&P lifted by energy shares; Nasdaq flat
By Leah Schnurr
NEW YORK (Reuters) - The Dow and S&P rose on Monday after a brokerage's positive comments lifted major energy companies and lower interbank lending rates gave investors hope the credit freeze might be thawing.
But the Nasdaq was little changed after falling briefly as concern about technology spending sunk shares, including Research In Motion. The maker of the BlackBerry tumbled 8.5 percent to $54.01.
Dow components Exxon Mobil and Chevron led the index higher after analysts at Oppenheimer & Co raised recommendations on the companies, as well as a raft of other energy companies. The companies rose by 5 percent to 6 percent.
A sharp drop in the cost of banks borrowing dollars from each other raised hopes that global efforts to shore up the banking system were taking hold. A lack of confidence had spurred financial institutions to hoard cash.
Testifying before a congressional panel, Federal Reserve Chairman Ben Bernanke said another round of government spending may be needed as the economy struggles through what could be an extended period of slower growth.
"It's obviously good news to see those (interbank) rates coming in a little bit," said Kurt Brunner, portfolio manager at Swarthmore Group in Philadelphia, Pennsylvania.
"So it could just be part of the on-going process here to see some of the loosening and to have the global credit markets be a little more comfortable."
The Dow Jones industrial average rose 113.34 points, or 1.28 percent, to 8,965.56. The Standard & Poor's 500 Index added 14.12 points, or 1.50 percent, to 954.67. The Nasdaq Composite Index edged up 2.37 points, or 0.14 percent, to 1,713.66.
On the earnings front, shares of Halliburton Co jumped more than 12 percent after the oil field services company reported better-than-expected results but cautioned the decline in oil prices from record highs could dampen profitability.
A gain in the price of oil on Monday also boosted energy companies, as crude rose on expectations OPEC may cut output this week to raise prices. U.S. front month crude rose more than $2 to over $74 a barrel.
Exxon climbed 5.3 percent to $71.65, while Chevron gained 6.5 percent to $66.40. The S&P energy index jumped more than 6 percent. Energy shares were among the worst hit last week on worries that slowing economic growth will continue to dampen demand.
In deal activity, Exelon Corp, the largest U.S. nuclear power operator, made an unsolicited offer over the weekend to acquire NRG Energy Inc for $6.2 billion in stock.
NRG surged 26.4 percent to $24.44, while Exelon slipped 2.8 percent to $53.00.
On Nasdaq, biotechnology shares, which are often seen as better able to withstand an economic downturn, advanced. Gilead Sciences was among the top gainers, up 4.2 percent to $44.82.
