Major indexes float to 13-month highs as commodity prices lift energy stocks

Major stock indexes managed to post modest gains Tuesday as higher commodity prices lifted energy and materials stocks. The advances were enough to push major stock indexes to new 13-month highs, though more stocks fell than rose at the New York Stock Exchange. The gains came after the market zigzagged for much of the day.

A rebound in the dollar after three down days sapped investors' appetite for stocks. Higher oil prices lifted energy stocks, and trading volume remained light. Traders focused on retailers' earnings reports for insight into one of the market's biggest worries: how much consumers are spending.


Home Depot, Saks and Target all reported better-than-expected third-quarter results but also said they remain cautious ahead of the holiday shopping season.

"Despite the dramatic rally in the stock market, we still see the consumer operating at recessionary levels," said Uri Landesman, chief equity strategist and senior portfolio manager at ING Investment Management in New York.

Better retail news pushed stocks higher Monday as a government report showed a rebound in overall sales in October. Investors are looking for signs that consumer spending, one of the biggest drivers of the U.S. economy, will recover during the holiday season.

A report on industrial production weighed on the market. The Fed said output at the nation's factories, mines and utilities rose 0.1% in October, less than the 0.4% predicted by economists polled by Thomson Reuters.

Meanwhile, signs of inflation remained muted, a positive signal for the economy. The Labor Department's Producer Price Index, which measures inflation at the wholesale level, rose less than expected in October. The 0.3% rise was smaller than economists' forecasts of 0.5% and followed a decline of 0.6% a month earlier.

"The market is saying inflation is not an issue," said Tim Courtney, chief investment officer at Oklahoma City-based Burns Advisory Group. He said that's a signal interest rates will remain low.

According to preliminary calculations, the Dow Jones industrial average rose 30.46, or 0.3%, to 10,437.42. The broader Standard & Poor's 500 index rose 1.02, or 0.1%, to 1,110.32, while the Nasdaq composite index rose 5.93, or 0.3%, to 2,203.78.

Falling stocks narrowly outpaced those that rose on the NYSE, where volume came to 972 million shares compared with 1.1 billion Monday.

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