MARKET REPORT: Ringing registers cheer investors

— Better Christmas sales and rising commodity prices pushed stocks to their sixth straight gain on Monday and new highs for 2009.

Major indexes edged higher in light trading after sales figures showed shoppers spent more freely this Christmas, a sign that consumers are feeling better about the economy.

Figures from MasterCard Advisors’ SpendingPulse, which track all forms of payment, show retail sales rose 3.6 percent from Nov. 1 through Dec. 24, after dropping during that time last year. Adjusting for an extra shopping day between Thanksgiving and Christmas, the number was closer to a 1 percent gain.

Consumer spending is oneof the biggest drivers of economic growth and is important for a sustained recovery.

Meanwhile, commodity prices rose as the dollar fell, giving a boost to energy and materials stocks.

Airline stocks fell, helping to keep the market’s gains in check. The Dow Jones transportation average fell 24.37, or 0.6 percent, to 4,163.49.

Markets were closed for Christmas and will be closed again Friday for New Year’s Day.

The Dow Jones industrial average rose 26.98, or 0.3 percent, to 10,547.08, its highest close since Oct. 1, 2008.

The Standard & Poor’s 500 index rose 1.30, or 0.1 percent, to 1,127.78, and the Nasdaq composite index advanced 5.39, or 0.2 percent, to 2,291.08.

Bond prices came off their lows after an auction of $44billion of two-year notes saw sufficient demand. Bond prices have been falling in recent weeks, pushing yields higher as stocks continue to advance amid improving economic data.

In total, the Treasury Department is issuing $118 billion of debt this week. Investors have worried this year that demand for government debt would wane amid the large amounts of supply. But so far, most auctions have gone smoothly.

The yield on the previously auctioned 10-year Treasury note, which moves opposite its price, rose to 3.85 percent from 3.80 percent Thursday.

Stocks added to moderate gains from last week, when stocks rose after upbeat reports on unemployment and durable-goods orders. This week, readings on home prices and consumer confidenceare among the few economic reports expected.

Stocks have managed to grind higher throughout December, but the gains have been more subdued than in recent months as investors have held back on making big moves going into the end of the year.

The S&P 500 index is up 66.7 percent since hitting a 12-year low in March.

Commodity prices rose as the dollar fell. Commodities are priced in U.S. dollars, so when the dollar is weak they become more attractive to foreign buyers.

Oil prices gained 72 cents to settle at $78.77 a barrel on the New York Mercantile Exchange. Gold also rose.

Advancing stocks narrowly outpaced those that fell on the New York Stock Exchange, where volume came to a light 2.8 billion shares.

Business, Pages 26 on 12/29/2009

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