Dow gains 35 points

Falling oil prices and strong earnings from home improvement retailer Lowe’s sent US stocks higher today as investors regained their optimism about corporate profits and the health of the economy.

A bullish outlook and better-than-expected fourth-quarter results from Lowe’s soothed investors’ concerns that earnings would decline as the economy slowed through the year.

Oil prices tumbled after surging to nearly 63 dollars per barrel on Friday as a knee-jerk response to a foiled terrorist attack against a Saudi Arabian processing facility worked through the market.

A barrel of light crude settled at 61 dollars, down 1.91 dollars, on the New York Mercantile Exchange. Investors have worried that a lasting spike in oil prices could spark inflation.

Analysts noted that today’s buying came after the markets turned in a mixed but promising performance last week despite increasing economic uncertainty and the terror attack, which points to strong investor enthusiasm for stocks.

“I think this is one of those times where it’s hard to be bearish,” said Chris Johnson, manager of quantitative analysis at Schaeffer’s Investment Research in Cincinnati. ”We’re still in a market that can easily fall prey to all kinds of intraday activity, up or down, but I think we have room to go higher over the next two to three weeks.”

The Dow Jones industrial average rose 35.70, or 0.32%, to 11,097.55.

Broder stock indexes also rose. The Standard & Poor’s 500 index added 4.69, or 0.36%, to 1,294.12, just 0.06 shy of a 4-year high set on January 11. The Nasdaq composite index gained 20.14, or 0.88%, to close at 2,307.18.