Confident Dow Gains 14.64 to Extend Rally

The stock market chalked up additional gains today amid improved investor confidence after Monday’s moderate rally.

The Dow Jones average of 30 industrials rose 14.64 to 2,617.12.

Advancing issues outnumbered declining ones by about 8 to 5 on the New York Stock Exchange, with 903 up, 564 down and 498 unchanged.

Big Board volume totaled 152.59 million shares, against 148.91 million in the previous session.

The NYSE’s composite index of all its listed common stocks closed 0.90 higher at 182.16.

At the American Stock Exchange, the market value index rose 1.04 to 351.40.

A partial recovery earlier in Tokyo after a key measure of the world’s biggest equities market took its second-steepest one-day plunge ever on Monday reassured U.S. investors, analysts said.

Spirits were lifted on Wall Street Monday when the market managed to overcome its uneasiness about Tokyo’s troubles.

Hildegarde Zagorski, a market analyst at Prudential-Bache Securities Inc., said stocks were ripe for a rebound, having been sold heavily before this week.

“I think what we’re seeing here is a technical rebound,” she said, noting that investors still are nervous about the consequences sluggish economic growth could have on corporate profits.

Investors, meanwhile, were reluctant to read too much significance into a tumble in orders to U.S. factories for durable goods. Stocks barely budged in response to the news, market watchers said.

The January drop of 10.5%, the biggest decline since the government began keeping track of the figures, was seen as further evidence of a slumping manufacturing sector. However, analysts noted that the orders are volatile and often subject to large revisions.

Bond prices rose sharply this morning, strengthened by what brokers said was momentum from Monday’s gains, a strong dollar and foreign buying of U.S. securities.

“The underlying healthy tone is still there,” said William Veronda, a fixed-income strategist at Financial Group, a Denver investment firm.

The Treasury’s key 30-year issue, up 5/8 point or $6.25 per $1,000 in face amount Monday, advanced again by nearly 1/2 point or $5 per $1,000 face amount as of late morning. The bond’s yield, which declines when the price rises, fell to 8.45% from 8.48% late Monday.

Credit analysts attributed the increase largely to what they called an ebullient mood, partly because of the U.S. market strength in the face of alarming weakness in the Japanese capital markets, the largest in the world.