By Kate Gibson, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks leapt on Wednesday after Ford Motor Co. reported its best retail-sales month in seven years and as investors tracked hearings on a proposed U.S. strike against Syria.
"Everybody was so focused on political dysfunction with the upcoming debt-ceiling debate, and this latest international crisis has shown a very unusual bipartisanship coming out of Washington," said Ron Florence, deputy chief investment officer for investment strategy, Wells Fargo Bank.
After an early 35-point fall, the Dow Jones Industrial Average (DJI) rose as much as 123 points, and was lately up 112.72 points, or 0.8%, at 14,946.8.
"The short-term volatility is all around how the world is going to respond to a humanitarian crisis," Florence added.
Intel Corp. (INTC) led gains that included 27 of the Dow's 30 components. Leading blue-chip losses, Microsoft Corp. (MSFT) fell 2.2% after Morgan Stanley cut its rating on the software maker following its deal to acquire Nokia Corp.'s (NOK) devices business.
Benchmark indexes traveled to session highs as U.S. Secretary of State John Kerry and Secretary of Defense Chuck Hagel spoke at a House hearing on the White House request for congressional approval of a limited strike against the Syrian regime.
A Senate committee expected to vote later in the day on a resolution supporting the use of U.S. military force in Syria.
The S&P 500 index (SPX) advanced 14.14 points, or 0.9%, to 1,653.91, with telecommunications and health care the best performing and utilities the sole decliner of its 10 major industries.
ETrade Financial Corp. (ETFCD) rallied 9.1% after it said regulators had approved its request to use capital from its bank subsidiary for wider corporate purposes.
Bolstering technology shares, Apple Inc. (AAPL) rose $10.42, or 2.1%, to $499 after Cantor Fitzgerald LP started coverage of its shares with a buy rating and a 12-month target of $777. Apple has announced a Sept. 10 event to display its new iPhone models and a second event in Beijing a day later that is adding to investor optimism.
Shares of LinkedIn Corp. (LNKD) fell 1.7% after the professional-networking site said in a securities filing it would sell 4.17 million of its Class-A stock, estimating it would reap $1 billion.
The Nasdaq Composite (RIXF) rose 34.26 points, or 1%, to 3,646.86.
The Nasdaq (NDAQ) experienced another glitch with its main data feed that halted trading for roughly three hours almost two weeks ago. The exchange said the outrage affected its ability to transmit quotes in stock symbols PC through SPZ. The trouble has been resolved, and trading was not impacted, Nasdaq said.
Advancers pulled ahead of decliners by a more than 2-to-1 ratio on the New York Stock Exchange, where 317 million shares traded as of 1:55 p.m. Eastern. Composite volume neared 1.9 billion.
Ford shares (F) rallied 3.6% after the vehicle manufacturer reported a spike in sales last month from a year earlier. and hiked its production plan for the fourth quarter.
"Equity investors appear to be reacting to a positive outlook reflected by Ford's decision to boost output -- itself a sign that a Fed tapering would arrive as the economy is strengthening, not weakening," wrote Andrew Wilkinson, chief economic strategist at Miller Tabak & Co., referring to the consensus expectation that the Federal Reserve would begin scaling back its monetary stimulus later this month.
In a televised news conference with Sweden's prime minister, President Barack Obama continued to make his case for a military reply to the use of chemical weapons against civilians in Syria last month.
"We believe very strongly with high confidence that chemical weapons were used; we want to join with the international community for an effective response," Obama said. "Even Syria doesn't deny they were used; the only remaining dispute is who used them," Obama said in Stockholm, as his top national security aides briefed lawmakers in public and private hearings on Capitol Hill.
The president also said the world should not find excuses not to act and that he believes a strong message can be sent to the Syrian regime. "It was this reach out in such terms that resulted in the drop in oil and gold," said Peter Boockvar, chief market strategist at the Lindsey Group LLC, in emailed comments.
On the New York Mercantile Exchange, both crude and gold futures fell, with oil (CLV3) down $1.51, or 1.4%, at $107.03 a barrel and gold (GCZ3) losing $22, or 1.6%, to $1,390 an ounce.
The Federal Reserve releases its Beige Book survey of economic conditions in its 12 districts at 2 p.m. Eastern time. Investors will be looking for clues as to the timing and amounts of any cuts in the central bank's $85 billion in monthly bond purchases.
"We continue to expect the Fed to taper later this month and its impact on the dollar could have very negative impacts on certain emerging-market economies," Nick Raich, CEO at the Earnings Scout, wrote in a research note.
The U.S. dollar (DXY) edged lower against currency rivals including the yen (USDJPY) and euro (EURUSD). U.S. Treasury prices were mixed, with the yield on the 10-year note (10_YEAR) rising 4 basis points to 2.889%.
Ahead of the Fed's release, San Francisco Fed President John Williams said the central bank should start curbing its stimulus later this year and stop it altogether by the middle of next, so long as the labor market continues to improve and inflation rises toward 2%.
On Friday, the government releases U.S. payrolls data for August, with the monthly report coming a day after Automatic Data Processing Inc. releases hiring data for last month. The labor market is a concern of the Fed and would likely factor in to any decisions made at the Federal Open Market Committee gathering later this month.
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