NEW YORK - A modest drop in crude oil futures sparked buying interest on Wall Street Tuesday, with investors scooping up shares battered by the selloff of the past few weeks.
The Dow Jones Industrial Average rose 43.90 points (0.43 percent) to 10,465.76 and the Nasdaq composite added 5.29 points (0.27 percent) to 1,996.36 at 1545 GMT.
The broad-market Standard and Poor's 500 index advanced 5.42 points (0.46 percent) to 1,181.54.
Sentiment perked up after crude oil futures, which hit fresh records in recent sessions, dipped 21 cents to 56.80 dollars a barrel in opening trade on the New York Mercantile Exchange.
"The markets are oversold and investors are really looking for a catalyst and the most obvious catalyst would be a decline in oil prices," said Michael Sheldon, chief market strategist at Spencer Clark LLC.
"The past few weeks have certainly been a rough patch for investors but I think if we can start to see a little bit of a pullback in oil prices then we're likely to see investors start to tiptoe back into the market."
Bob Dickey at RBC Dain Rauscher noted that the markets have been holding key psychological levels like 10,400 for the Dow, despite some early weakness on Monday that saw a temporary dip below that level.
"Once again, the market moved to the edge of the cliff and waved its arms and even a leg over the edge, and then backed away from jumping into the pit of eternal doom," he said in a note to clients.
"With each test of the support levels the more important they become to hold, and also the stronger they become. In order to pull out of this testing process we believe the Dow must now break through the peak from last week at 10,600, which would help to build our confidence that a new rally phase was beginning."
Among active shares, Pfizer was in focus after announcing a major reorganization that included more cost-cutting and investment in research that will cut into profits in the short-term. The world's biggest drugmaker rallied 80 cents to 26.73.
Boeing jumped 87 cents to 59.20 after announcing it delivered 70 aircraft in the first quarter.
ConocoPhillips dipped eight cents to 110.49 after the oil giant said its production in the first quarter of 2005 was roughly flat from the prior quarter.
Morgan Stanley, facing a growing revolt from dissident shareholders and former executives, fell 1.29 to 57.01 announcing plans to spin off its Discover credit card operations, dashing hopes for a partial or full buyout of the investment bank and brokerage giant.
In the tech arena, Google climbed 3.26 to 188.55 after a favorable research note on the Internet search giant from Lehman Brothers.
Bonds drifted lower. The yield on the 10-year US Treasury bond rose to 4.470 percent from 4.456 percent Monday and that on the 30-year bond climbed to 4.751 percent from 4.730 percent. Bond yields and prices move in opposite directions.
04/05/2005 15:52 GMT