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Dow on record high for second consecutive day

Dow on record high for second consecutive day
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First Published: Fri, Feb 16 2007. 06 21 AM IST
Updated: Fri, Feb 16 2007. 06 21 AM IST
New York: The Dow Jones Industrial Average climbed to a second consecutive record as falling import prices bolstered expectations the Federal Reserve will cut interest rates.
Qualcomm Inc., the second-biggest maker of mobile-phone chips, helped lift the Standard & Poor’s 500 Index and Nasdaq Composite Index for a third day. Caterpillar Inc., the largest producer of earthmoving equipment, rose to a four-month high on plans to repurchase $7.5 billion of its shares, while health-care companies surged as Warren Buffett’s Berkshire Hathaway Inc. bought a stake in UnitedHealth Group Inc.
The government’s import price index, showing lower inflation, coincided with Fed Chairman Ben S. Bernanke’s congressional testimony that price pressures were abating. Odds of a rate cut by August have quadrupled this week based on futures contracts that allow bets on the direction of borrowing costs.
The Dow average rose 23.15, or 0.2 percent, to 12,765.01. The S&P 500 added 1.51, or 0.1 percent, to 1456.81. The Nasdaq increased 8.72, or 0.4 percent, to 2497.10.
Gains were limited by a drop in energy shares after crude prices fell as much as 2.4 percent. A gauge of oil-related companies in the S&P 500 was the biggest drag on the index.
Three-Day Advance
The Dow average has advanced 1.7 percent over three days, driven by takeovers and comments from Bernanke to Congress that the economy will expand at a “moderate” pace as inflation eases.
Bernanke reiterated his Senate testimony from yesterday that price increases are slowing amid falling energy and commodity costs. The Fed chief’s semi-annual address continued for a second day before the House of Representatives.
The Report on import prices supported Bernanke’s view. The import price index declined 1.2 percent in January, the biggest drop in three months.
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First Published: Fri, Feb 16 2007. 06 21 AM IST
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