US stocks: S&P 500 reaches 4-year high

NEW YORK - US stocks rose on Friday, boosted by positive news from Hewlett-Packard Co. and General Electric Co. and by declining oil prices, pushing the broad S&P 500 Index to its highest close in nearly 4-1/2 years.

GE, the largest US industrial conglomerate, raised its 2006 profit outlook and increased its dividend and stock buy-back plan. It also announced plans to sell most of its reinsurance business to Swiss Re for US$7.6 billion. GE shares rose 3.1 per cent to US$35.75.

No. 2 computer maker Hewlett-Packard, whose stock was the best performer in the Dow industrial average this year, rose 1.4 per cent to US$29.40 a day after posting a quarterly profit that surpassed expectations.

A decline in crude oil prices also helped boost stocks, but weighed on some energy-related shares. Lead-month crude oil futures settled down 20 cents at US$56.14 a barrel, after touching a five-month low of US$55.40 earlier in the session.

"Consumer sentiment, the economy and earnings in general are pretty good because petrol has come down," said Edgar Peters, chief investment officer at PanAgora Asset Management Inc. in Boston. "The end-of-the-year rally has already started."

The Standard & Poor's 500 Index rose 5.47 points, or 0.44 per cent, to end at 1,248.27, the highest since June 2001.

The technology-laced Nasdaq Composite Index was up 6.61 points, or 0.30 per cent, at 2,227.07, also its highest close in more than four years.

The Dow Jones industrial average closed up 46.11 points, or 0.43 per cent, at 10,766.33, the highest since March.

The S&P 500 and Dow posted their fourth straight weeks of gains, while the Nasdaq rose for a fifth consecutive week. For the week, the Dow gained 0.75 per cent, the S&P 1.10 per cent and the Nasdaq 1.12 per cent.

Some of the Dow's gains were limited by media and entertainment company Walt Disney Co., which fell 3 per cent to US$25.20 on a weak fourth-quarter profit.

"The market acted pretty well on the week," said Victor Pugliese, managing director at First Albany Corp. "Hewlett-Packard had good news, GE had good news. If Disney wasn't doing what it was doing, the market might have been up more."

General Motors Corp. -- like Hewlett-Packard, GE and Disney a Dow component -- rose 6.4 per cent to US$24.05 after a newspaper reported the company would announce a restructuring plan next week that may include plant closings and at least 25,000 job cuts. GM's chief said on Thursday the company was not headed toward insolvency.

Oil company ConocoPhillips lost 1.4 per cent to US$62.23 with the decline in crude futures.

On Nasdaq, Cisco Systems Inc. fell after it said it would buy cable television set-top box maker Scientific-Atlanta Inc. for US$6.9 billion, moving the internet equipment maker into the home entertainment market. Cisco fell 2 per cent to US$17.02.

Trading was heavy on the NYSE, with about 1.81 billion shares changing hands, above last year's daily average of 1.46 billion, while on Nasdaq, about 2 billion shares traded, above last year's daily average of 1.81 billion.

Advancing stocks outnumbered declining ones by a ratio of 3 to 2 on both the NYSE and Nasdaq.

- REUTERS