Investors were also undeterred by a government release of a much anticipated concept paper on stress tests for the 19 biggest US financial services companies.
American Express gave the most fuel to the Dow's rise, shooting up nearly 21 percent to US$25.30 a day after reporting results that topped analysts' expectations, helped by aggressive cost cutting.Ford Motor Co. also posted a smaller-than-expected first-quarter loss and said it was on track to at least break even in 2011 and did not expect to seek U.S. government loans, sending its shares up 11.4 percent to US$5.
Economic data also fed the buying frenzy after durable goods orders slipped in March, but fell far less than Wall Street expected. Sales of new single-family homes dropped, but inventories plummeted at a record pace. "The earnings news last night, as well as this morning in general, appears to be relatively positive and, at the core, the durable goods orders this morning also provided further indication that the manufacturing sector is showing tentative signs of improvement," said Michael Sheldon, chief market strategist at RDM Financial in Westport, Connecticut.
The Dow Jones industrial average added 119.23 points, or 1.50 percent, to 8,076.29. The Standard & Poor's 500 Index rose 14.31 points, or 1.68 percent, to 866.23. The Nasdaq Composite Index gained 42.08 points, or 2.55 percent, to 1,694.29.For the week, the Dow fell 0.7 percent and the S&P slid 0.4 percent, while the Nasdaq rose 1.3 percent.
The declines for the blue-chip Dow average and the broad S&P 500 snapped a six-week streak of gains. In contrast, the Nasdaq extended its winning streak to seven straight weeks, its longest string of gains since early May 2007.
On the financial front, the Federal Reserve said the top 19 U.S. banks need to hold a "substantial" amount of capital above regulatory requirements to weather a potential worsening of the economic recession, according to the Fed's white paper on bank stress tests.