NEW YORK -- U.S. stocks rose a second day yesterday, paced by gains in Mobil Corp. and other oil issues, amid optimism that a compromise will be reached on balancing the federal budget. Computer equipment and software stocks also advanced.
Talks between President Clinton and congressional leaders renewed confidence that the two sides could soon agree on a budget plan, ending a partial shutdown of the government. If the two sides succeed in bringing spending in line with revenue, interest rates would fall, helping profits to blossom, investors said.
The Dow Jones industrial average closed up 1.44, at 5,097.97, after having been as high as 30.34. The gain, led by shares of General Electric Co., AT&T Corp. and Boeing Co., came as pre-Christmas volume on the New York Stock Exchange slowed to 290 million shares, the smallest since the day after Thanksgiving.
For the week, the average dropped 78.76 points, or 1.52 percent, after plunging 101 points Monday and 50 points Wednesday.
Coca-Cola Co. shares fell for a second day, dropping 75 cents, to $72.
The Atlanta-based soft-drink maker yesterday warned that fourth-quarter sales increases outside the United States may grow about 5 percent, 2 percentage points less than analysts estimated.
3M, down $1.50 to $64, also dropped for a second day. The Wall Street Journal reported Thursday that one-time write-offs such as 3M recently announced sometimes mask deeper trouble at a company.
The Standard & Poor's 500 index gained 1.46 to 611.95; the Wilshire 5,000 index advanced 14.54 to 6,002.99; and the Russell 2,000 index of small-company shares climbed 1.64 to 312.31.
Oil stocks gained as the price of crude rose above $19 a barrel. Shares of Mobil Corp. rose $1.125 to $111.625; Royal Dutch JTC Petroleum Co. added 50 cents to $138.875; Exxon Corp. rose 37.5 cents to $81.375; and Texaco Inc. rose 25 cents to $78.
Enron Corp. vaulted $2.375 to $37.375. The natural gas producer bought back shares on the open market, seeking to quash speculation that it faced financial problems from margin calls on futures contracts.
Among computer makers, Sun Microsystems Inc. jumped $1.50 to $48.50. Fujitsu Ltd. will license Sun's Java computer programming language, which promises to be one of the main tools for building services on the Internet.
Other computer makers also rallied, a day after software makers 3Com Corp. and Broderbund Software Inc. posted higher-than-expected quarterly profits.
Data General Corp. leaped $1.625 to $14.75; Compaq Computer Corp. added $1.125 to $49.75; International Business Machines Corp. gained 37.5 cents to $91.25; and Hewlett-Packard Co. climbed 87.5 cents to $84.625.
Sun's gain helped send the Nasdaq composite index up 6.25 to 1,046.89, after it leaped 15.37 points, or 1.5 percent, Thursday. Also rising were shares of Amgen Inc., Oracle Corp., Cisco Systems Inc. and Microsoft Corp.
Surging bond prices further fueled stocks' advance. The benchmark 30-year government bond rose 18/32, or $5.63 per $1,000 bond, pushing its yield down to 6.06 percent.