(Updates to midday, changes byline)
By Cal Mankowski
NEW YORK, Feb 26 (Reuters) - U.S. stocks jumped on Tuesday
after IBM <IBM.N> said it will buy back $15 billion of its
shares, boosting the computer hardware sector, while energy
companies' shares climbed as oil rose past $101 a barrel.
On Tuesday, Moody's comfirmed bond insurer MBIA Inc's
<MBI.N> "AAA" rating. MBIA shares shot up 4.3 percent to $15.20
on the New York Stock Exchange. That news followed a rally
triggered late on Monday by signs that the the two largest bond
insurers could stabilize.
The Dow and Nasdaq each rose more than 1 percent.
Computer services company IBM said the buyback program
could boost its 2008 earnings, and lifted the broader market as
it showed it can still earn robust profits even as economic
data indicates the U.S. economy is on the brink of a
recession.For details, see []
Energy shares were the top driver of the S&P's advance,
with a weak dollar and geopolitical tensions driving the price
of oil higher. Shares of Chevron Corp <CVX.N> rose 1.1 percent
to $88.11.
"The market is looking for positives. IBM's a big component
of the market, it's a large weighting. That, combined with
Ambac and the move late yesterday, is giving short-term
direction in the market," said Mark Schlarbaum, a trader at
Global Capital Management, in Conshohocken, Pennsylvania.
The Dow Jones industrial average <> was up 145.31
points, or 1.16 percent, at 12,715.53. The Standard & Poor's
500 Index <.SPX> was up 13.38 points, or 0.98 percent, at
1,385.18. The Nasdaq Composite Index <> was up 30.32
points, or 1.30 percent, at 2,357.80.
Stocks added to gains after Federal Reserve Vice Chairman
Donald Kohn said risks to economic growth were more of a threat
than inflation and that the Fed was ready to do what it needs
to respond to "difficult times." Since last August, the Fed has
taken an aggressive approach to cutting interest rates to
stimulate the economy.
IBM shares rose 4.4 percent to $114.87 and contributed the
most to the Dow's gains.
Hewlett-Packard Co <HPQ.N> told a technology investment
conference that the computer and printer maker remains
confident about its previous earnings forecast, which was ahead
of Wall Street's estimates.
HP's shares added 2.6 percent to $49.36.
The tech and energy sector news overshadowed a report
earlier in the day showing inflation making an unwanted
comeback and another report that consumer confidence hit a
5-year low.
U.S. producer prices last month had their biggest 12-month
gain in more than 26 years, the government said, dealing a blow
to investors' hopes for more Fed rate cuts to avert a
recession.
The Conference Board, a private research group, said its
index of consumer confidence for February fell to a 5-year low,
hurt by a much tougher job market.
(Additional reporting by Jennifer Coogan; Editing by Jan
Paschal)
