By Steven Russolillo
NEW YORK (MarketWatch) -- U.S. stocks rose Tuesday as the dollar
fell after the Bank of Japan unexpectedly announced it was pumping
more funds into its struggling economy to spur growth.
The Dow Jones Industrial Average (DJI) rose 94 points, or 0.9%,
to 10844 on Tuesday, erasing Monday's 78-point drop. Caterpillar
(CAT) powered the Dow's gains, rising 2.1%, while United
Technologies (UTX) increased 1.8% and J.P. Morgan Chase (JPM) rose
1.5%.
The Nasdaq Composite (RIXF) rose 1.2% to 2372. The Standard
& Poor's 500-share index (SPX) rose 1.1% to 1149. All ten of
its sectors traded in positive territory, led by the materials and
financial sectors.
The Bank of Japan surprisingly announced a $418 billion monetary
easing program while cutting interest rates to virtually zero. The
BOJ acted under pressure from the government to do more to promote
growth and take the steam out of the high yen, which has stymied
the critical export sector.
Among the specifics, the central bank said it would cut its key
overnight call rate to a range of 0.0%-0.1%, with rates to remain
at this virtual zero level until prices begin to stabilize from
deflationary pressures.
Meanwhile, the Bank of Australia held steady on interest rates
even as most economists expected it to boost rates. Moody's
Investors Service also said it may cut Ireland's debt rating again,
citing the increased cost to the government of repairing the
stricken banking system, weak economic growth and rising borrowing
costs.
The dollar sank against the yen after getting only a brief
BOJ-related boost. Gold pushed higher to an intraday record of
$1,329.60 an ounce.
The dollar dropped against the euro. The euro was trading
recently at $1.3795, up from $1.3690 late Monday in New York. The
U.S. Dollar Index (DXY) , which tracks the currency against a
basket of six others, fell 0.6%.
Demand for Treasurys increased, sending the yield on the 10-year
note (UST10Y) down to 2.46%. The 2-year yield slipped to another
record low. Crude-oil prices climbed to just above $82 a
barrel.
Investors also remain focused on some key data later this week.
Dow-component Alcoa (AA) unofficially kicks off earnings season
after the close on Thursday, just ahead of the monthly jobs report
on Friday.
Among stocks in focus, Mosaic's (MOS) fiscal first-quarter
earnings nearly tripled, coming off a very steep drop in profit in
the year-earlier period, as the fertilizer maker's revenue and
margins both jumped. Shares rose 2.1%.
Women's apparel retailer Talbots (TLB) cut revenue guidance for
the quarter and year as President and Chief Executive Trudy
Sullivan said traffic in the fiscal third quarter "has been
inconsistent." Shares slid 10%.
Still to come, ISM non-manufacturing data is scheduled for
release at 10 a.m. EDT.