Buyers on Main Street influence buyers on Wall Street

NEW YORK -- Wall Street reveled in its best day in a month Thursday with buyers reasserting themselves amid upbeat news about consumer spending.

Investors were heartened by stronger-than-expected October retail sales. Analysts said the market also drew strength from Iraq's agreement Wednesday to a U.N. resolution calling for weapons inspections, which could avert a war.

The Dow Jones Industrial Average closed up 143.64, or 1.7 percent, at 8,542.13. It was the Dow's best one-day advance since Oct. 21 when it rose 215.84.

The broader market posted its best gains in a month. The Nasdaq climbed 50.18, or 3.7 percent, to 1,411.52. It was Nasdaq's best day since Oct. 15 when it rose 61.91.

The Standard & Poor's 500 index advanced 21.74, or 2.5 percent, to 904.27. It was also the S&P's best one-day gain since Oct. 15 when it rose 39.83.

"The market has been boosted by the good retail sales numbers and the fact that the imminence of U.S. military action against Iraq has been delayed. Those two events have been a magnet for money," said Alan Ackerman, executive vice president at Fahnstock & Co.

Thursday's gains followed news that sales at the nation's retailers were flat in October, better than the 0.2 percent decline analysts had expected. It was also an improvement over a 1.3 percent drop in sales for September.

Consumers bought fewer new cars but splurged on clothes. That raised hopes among economists that consumers will spend enough this holiday season and prevent the sputtering economy from sliding back into recession.

The news was encouraging to investors, who know consumer spending represents economic vitality, accounting for two-thirds of the nation's economy.

Retailing stocks were strong. Target surged $3.46 to $33.49 on third-quarter earnings that were 2 cents a share higher than expected.

"People are looking for reasons to buy stocks, rather than sell them. When investor psychology changes, that is what happens. Two months ago nobody wanted to buy," said Michael Murphy, head trader for Wachovia Securities.

While the market's advance was widespread across sectors, analysts were most encouraged by the tech sector's gains.

"Technology is fairly valued. And, I think the market is telling you that the economy is starting to shape up. With that in mind, you want to own these stocks," Murphy said.

Tech gainers included Microsoft, up $1.63 at $56.99, and Oracle, which rose 73 cents to $10.35.

Another economic report suggested companies are reducing the speed at which they lay off workers. For a second straight week, new claims for jobless benefits fell, declining last week by 8,000 to 388,000, a three-month low, the Labor Department said.

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