US stocks end higher

Wall Street gained momentum today, surging higher for the second straight day on the Federal Reserve’s positive outlook for the economy.

The Dow Jones industrials rose by triple digits, bringing its two-day advance to more than 300 points.

US investors are feeling more confident that business is poised to turn around following the Fed’s statement on Wednesday that the economy was strengthening. Better-than-expected earnings from Procter & Gamble added to the gains, while an analyst upgrade of Intel helped technology stocks.

But there were some signs of lingering caution, including some early selling in the tech sector.

The Dow Jones industrial average closed up 157.14, or 1.6%, at 9,920.00, exceeding Wednesday’s 144.62-point climb. The biggest contributor to the Dow’s gain was P&G.

The broader market also finished higher. The Nasdaq composite index rose 20.67, or 1.1 percent, to 1,934.11 following Wednesday’s 20-point win. The Standard & Poor’s 500 index advanced 16.64, or 1.5%, to 1,130.21 after gaining 12 points on Wednesday.

Analysts credited much of the two-day winning streak to long-awaited signs that the economy is recovering. Besides the Fed, investors were encouraged by news that the economy grew at a 0.2% annual rate in the fourth quarter. That increase could signal that the recession ended late last year or early in 2002.

Today also produced good economic news as the Labour Department reported that Americans’ incomes increased a solid 0.4% in December, after staying level the month before.

‘‘What we have seen this week is that we have turned the corner. We have left the recession behind,’’ said Jeff Kleintop, chief investment strategist for PNC Financial Services Group in Philadelphia.

Procter & Gamble soared dlrs 3.39 to dlrs 81.68 after surpassing quarterly earnings expectations by a penny a share and reaffirming its projections for fiscal 2002. The maker of Crest and Tide, which also posted its first sales increase in a year, was the strongest Dow stock.

Another consumer products maker, Kraft Foods, climbed dlrs 1.56 to dlrs 37.06 after raising its 2002 earnings projections beyond analysts’ expectations.

Other blue chip gainers included Home Depot, up dlrs 1.02 at dlrs 50.09, and JP Morgan Chase, which rose 99 cents to dlrs 34.05.

Chip maker Intel, also a Dow industrial, gave the tech sector some lift, rising dlrs 1.18 to dlrs 35.04 after its shares were upgraded by Merrill Lynch.

Other tech advancers were IBM, up dlrs 2.34 at dlrs 107.89, and Oracle, which gained 64 cents to dlrs 17.26 on an upgrade from Prudential Securities.

Also in tech trading, shares of Hewlett-Packard and Compaq Computer posted moderate gains following clearance of their dlrs 23.6 million merger from the EU. H-P inched up 15 cents to dlrs 22.11, while Compaq rose 36 cents to dlrs 12.35.

Analysts said bargain hunting also factored into today’s advance as buyers took advantage of cheaper prices following a big selloff on Tuesday, when the Dow tumbled 247.51, its biggest one-day point drop in three months. Worries about companies accounting procedures, precipitated by the collapse of Enron, were cited as the biggest factor in that drop.

‘‘I continue to believe that we are in a major recovery from late September lows. ... We have had a setback because of the Enron situation. Everyone got a bit frightened,’’ said Al Mirman, strategist at V Finance in Sarasota, Florida.

Today’s upturn also came despite mildly disappointing economic data as the Commerce Department reported consumer spending slipped 0.2% in December.

Advancing issues outnumbered decliners nearly 2 to 1 on the New York Stock Exchange. Volume totalled 1.52 billion shares, down from Wednesday’s 1.97 billion.

The Russell 2000 index, which measures the performance of smaller company stocks, rose 3.38, or 0.7%, to 483.10.