NEW YORK Stocks rose for a fifth consecutive day Tuesday as investors latched on to reports of progress in fiscal-cliff talks in Washington. The Standard & Poors 500 index had its biggest gain this month.
The Dow Jones industrial average gained 78.56 points to 13,248.44. It was up as much as 137 points earlier in the day. The S&P 500 finished up 9.29 points at 1,427.84. The Nasdaq composite ended up 35.34 points at 3,022.30.
The Wall Street Journal reported that budget negotiations between the White House and Republican House Speaker John Boehner had progressed steadily in recent days. That reinvigorated talks that appeared to have stalled, the paper reported, citing people close to the process.
Stock markets stayed higher even after Boehner said midday Tuesday that President Barack Obama is slow-walking talks to avoid the fiscal cliff, and hasnt outlined spending cuts hes willing to support as part of a compromise. Senate Majority Leader Harry Reid said Tuesday afternoon that it would be extremely difficult to pass legislation to address the so-called fiscal cliff before Christmas, but added theres still a chance it can be done.
The market has been very susceptible to fiscal cliff headlines, said Todd Salamone, a senior vice president at Schaeffers Investment Research, adding that stocks have rallied more on good news than they have fallen on indications that talks were stalling. It seems the expectation is that something will get done, but its a very cautious expectation. Theres a lot of money on the sidelines.
Delta Air Lines rose 52 cents, or 5.1 percent, to $10.66 after the company said it will buy almost half of Richard Bransons Virgin Atlantic for $360 million as it seeks a bigger share of the lucrative New York-to-London travel market.
AIG gained $1.90 to $35.26 after the U.S. Treasury Department said it has sold the rest of its stake in the insurer. AIG was bailed out by the government after nearly collapsing during the 2008 financial crisis.
The S&P and Nasdaq got a boost from Apple, which makes up 4 percent of the S&P and 11 percent of the Nasdaq. Apple isnt part of the Dow.
Apple advanced $11.57, or 2.2 percent, to $541.39, its biggest advance in more than a week. Apple had fallen sharply since closing at a record high of $702.10 on Sept. 19 as investors worried that the tech giant wont be able to maintain its rapid growth as competition in the smartphone market intensifies.