* Obama and top Republican meet amid signs of movement
* Clearwire down after agreeing to sell rest of company to
* Financials lead; Meredith Whitney group issues upgrades
* Indexes up: S&P 0.8 pct, Dow 1.2 pct, Nasdaq 1.3 pct
By Caroline Valetkevitch
NEW YORK, Dec 17 The S&P 500 ended at its
highest level in almost two months on Monday on rising hopes
that negotiations over the "fiscal cliff" were making progress
and that a deal could be reached in days.
After weeks of stalemate, President Barack Obama and
Republican House Speaker John Boehner met at the White House on
Monday, raising hopes that Washington will be able to head off
steep tax hikes and spending cuts that threaten the economy.
All of the S&P 500's 10 sectors were higher, led by
financials and other growth-oriented sectors. The S&P Financial
Index gained 2.1 percent, and shares of Bank of America
jumped 4 percent to $11. In a research note Monday,
Meredith Whitney Advisory Group shifted to a positive stance on
financials and upgraded Bank of America, Citigroup and
Discover Financial shares.
The S&P consumer distretionary index, up 1.8
percent, was the second-best performing sector. Investors worry
the U.S. economy could slide into recession if the tax and
spending changes are implemented.
Boehner has edged closer to Obama's position by proposing to
extend lower tax rates for everyone who earns less than $1
million. Still, his position remains far from that of President
"Trumping everything right now are the fiscal cliff talks.
It seems like progress is being made. I think it's getting to
the nitty gritty," said Alan Lancz, president of Alan B. Lancz &
Associates Inc. in Toledo, Ohio. "The bet right now is that
something will come by the end of this week."
The Dow Jones industrial average was up 100.38
points, or 0.76 percent, at 13,235.39. The Standard & Poor's 500
Index was up 16.78 points, or 1.19 percent, at 1,430.36,
its highest close since Oct. 22. The Nasdaq Composite Index
was up 39.27 points, or 1.32 percent, at 3,010.60.
The gains, which came on lighter-than-usual volume, ended a
two-day losing streak on the S&P 500. The index also had its
best daily percentage gain since Nov. 23. Volume was roughly 6.2
billion shares traded on the New York Stock Exchange, the Nasdaq
and the NYSE MKT, compared with the year-to-date average daily
closing volume of 6.4 billion.
In the financial sector, American International Group Inc.
shares rose 3 percent to $34.95 on plans to sell as much
as $6.5 billion of AIA Group Ltd. Advancing stocks also included
those in the home construction sector, which rose 4.5
"People are looking for sectors to play, and I think Bank of
America broke out of some long-standing price levels, and it got
everything going in that sector," said Rick Meckler, president
of investment firm LibertyView Capital Management in Jersey
City, New Jersey.
Shares of Citigroup were up 4.1 percent at $39.15
while shares of Discover Financial were up 1.6 percent
Clearwire Corp agreed to sell the rest of the
company to Sprint Nextel Corp for a slightly sweetened
$2.2 billion offer just days after minority shareholders
criticized the previous bid as too low. Clearwire tumbled 13.6
percent to $2.91, while Sprint was up 0.2 percent to $5.56.
Apple Inc shares edged up after recent losses,
rising 1.8 percent to $518.83 even though two firms cut their
price targets on the stock Monday.
The tech giant said it sold more than 2 million of its new
iPhone 5 smartphones in China during the three days after its
launch there on Friday, but the figures did not ease worries
about stiffer competition. Apple shares have tumbled more than
25 percent in about three months.
Compuware Corp rose 12.9 percent to $10.76 after
hedge fund Elliott Management offered to buy the business
software maker for $2.3 billion and S&P Capital IQ raised the
target price and moved it to "hold" from "strong sell."
Advancers outnumbered decliners on the NYSE by about 2 to 1,
and on the Nasdaq by nearly 9 to 4.