Bargain hunting fuel stock rally

Bargain hunting have propelled US stocks sharply higher after better-than-expected results from Yahoo.

The Dow Jones closed up yesterday at 137.77, or 1.4%, at 9,850.04, rebounding from the 211-point loss the previous session, and the Nasdaq gained 41.37, or 2.1%, to 1,985.81.

The Standard & Poor's 500 index rose 11.33, or 1% to 1,138.90, while the Russell 2000 index gained 5.97 to 482.39.

Although the gains were significant, analysts were quick to note they followed losses in six of the last eight sessions.

In trading, investors bid Yahoo up $2.25 to $20.12 an indication that its ad market appears to have stabilized.

Other tech stocks rose in anticipation of earnings reports. IBM gained $2.65 to $119.90, while Microsoft climbed $1.99 to $69.86 ahead of what Wall Street bet would be positive outlooks.

But the buying was selective. Advanced Micro Devices fell 63 cents to $17.28 despite reporting a smaller-than-expected quarterly loss and saying it anticipates profitability in the second quarter. Also Intel rose 82 cents to $34.53.

JP Morgan Chase rose 65 cents to $36.85, after falling sharply the previous session on dismal earnings. Standard & Poor's rating agency also cut the bank's outlook to negative from stable citing loan and investment banking problems.

United Technologies rose $4.30, or 7.3%, to $63.35 after beating Wall Street estimates despite a 19% drop in quarterly earnings. In addition, Kmart lost 4 cents to $1.56 on news its president has left amid a management reshuffling.

Advancing issues led decliners 3 to 2 on the New York Stock Exchange. Volume came to 1.36 billion shares, compared with 1.46 billion shares on Wednesday.