US stocks up despite terror arrests

Wall Street withstood the news of a terror plot targeting commercial airlines today, with stocks moving higher on strong corporate earnings reports and a sharp drop in oil prices.

European markets tumbled as British authorities said 24 people were arrested in a widespread plot to destroy numerous international flights, and the US raised its terror alert to the highest levels yet for air travelers.

But while US and international airline stocks fell as a result, strong earnings reports from Dow component American International Group and others lent support to US markets.

Wall Street also benefited from lower crude prices, which fell on the belief that reduced travel in the coming weeks and months would curtail demand for fuels. A barrel of light crude settled at 74, down 2.35, on the New York Mercantile Exchange.

“With the whole issue of what’s happening in London, we could have seen a major sell-off, but we didn’t,” said Stuart Freeman, chief equity strategist for AG Edwards & Sons. “All these things that have happened lately, with inflation and interest rates and oil, you’d think the market would have had a really difficult time with that. But there’s some upside here.”

The Dow Jones industrial average rose 48.19, or 0.44%, to 11,124.37.

Broader stock indicators also rose. The Standard & Poor’s 500 index added 5.86, or 0.46%, to close at 1,271.81, and the Nasdaq composite index gained 11.46, or 0.56%, to end on 2,071.74.