NOVEMBER 23 2009 16:16h

Wall Street surges to open week

A sign for Wall Street




The market will be closed on Thursday for the Thanksgiving Day and it will be open only half a day the next day.

US stocks roared higher Monday with traders focusing on a weak dollar that boosted commodities and other shares sensitive to greenback-linked movements.

The Dow Jones Industrial Average jumped 144.35 points (1.40 percent) to 10,462.51 in the first exchanges, rebounding from a three-session losing streak.

The tech-heavy Nasdaq rose 35.96 points (1.68 percent) to 2,182.00 and the broad-market Standard & Poor's 500 index added 18.43 points (1.69 percent) to 1,109.81. Both indexes ended lower last week.

Traders said stocks surged from the opening bell as the dollar weakened with expectations that interest rates would remain at near zero low levels.

- Weakness in the US dollar has prompted a run on commodities and equities heading into the open, with traders reacting to exit-strategy comments from a Federal Reserve member over the weekend - said analyst Joseph Hargett of Schaeffer's Investment Research.

The dollar slid against the euro on Monday on concerns that the Federal Reserve may keep emergency stimulus measures in place for a while longer, helping push gold prices to a record high level, analysts said.

Comments by Federal Reserve Bank of St. Louis President James Bullard that he would prefer to keep the central bank's asset-buying programme active beyond its current cut-off date pushed the dollar lower, analysts said.

An extension of the program, widely considered a negative factor for the US currency, would give more flexibility to US policymakers, he said.

- Bullard's comments stand in stark contrast to the action of the European Central Bank, which announced its first tightening steps on Friday - Hargett said.

Separately, the holiday-shortened week ahead will provide plenty of economic data to digest, beginning Monday with the October existing home sales report.

In the past week, the market was chilled by data showing a 10.6 percent slide in October housing starts, along with a drop of four percent in permits to build new homes, a leading indicator of the sector.

This makes data on existing home sales and new home sales more critical for investors, said Sal Guatieri at BMO Capital Markets.

The market will be closed on Thursday for the Thanksgiving Day and it will be open only half a day the next day.