Wall Street sets records even as oil jumps

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NEW YORK -- U.S. stocks rallied to record highs Friday on optimism about economic growth, takeovers and corporate profits even as oil prices surged on concerns about North Sea production problems.

The Dow blue-chip index set a record for the second straight day and the Standard & Poor's 500, a broader measure of large U.S. stocks, regained a life high after seven years.

Both overshadowed minor gains in U.S. Treasuries and a steady dollar, which rebounded from its lows against the euro.

The greenback and stocks were supported by expectations of an improving economy after a surprisingly strong U.S. consumer sentiment report for July offset news of a drop in retail sales in June. Treasuries benefited from weaker retail sales.

"It's optimism based on earnings, and people just seem to be ignoring oil prices right now," said Giri Cherukuri, head trader at Oakbrook Investments LLC in Lisle, Illinois.

"Next week is going to be a lot more earnings coming out, and it will drive the market. I think we may not get as strong moves every single day next week, but we will maintain these levels. People are very optimistic," he added.

General Electric Co. reported a 9.6% increase in quarterly earnings Friday, in line with expectations, and increased a stock buyback plan, boosting the Dow.

Shares in GE, the world's second-largest company by market capitalization, closed up 1.3% at $39.50. Shares of energy companies also rose in response to surging oil prices, with Exxon Mobil Corp. rising 0.8% to $90.33.

Some investors took profits but this did not affect the market overall.

The Dow Jones industrial average rose 45.52 points, or 0.33%, to end at a record 13,907.25. The Standard & Poor's 500 Index gained 4.80 points, or 0.31%, to finish at 1,552.50, also a record close. The Nasdaq Composite Index advanced 5.27 points, or 0.20%, to close at 2,707.00.

The S&P 500 rose as high as 1,555.10. Its previous record of 1,553.11 was set on March 24, 2000, in the waning days of the Internet bubble.

The Dow hit an intraday record at 13,932.29 and the Nasdaq climbed as high as 2,707.64, its highest in more than 6-1/2 years.

For the week, the Dow ended up 2.2%, the S&P 500 rose 1.4% and the Nasdaq gained 1.5%.
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