By Edward Krudy
NEW YORK (Reuters) - Stocks were on course for four weeks of gains on Friday as traders put the September rally firmly back on track after three down days for equities.
The economic data was mixed, but traders latched on to a rise in business spending in August as the latest sign the recovery is on firmer ground. That appeared to trump data that showed new U.S. single-family home sales were flat in August.
Buying was broad across multiple sectors but early indications were that volume was on course for another moderate day despite the near 2 percent rise in major indexes. Around 3.5 billion shares had traded shortly after midday.
"The volume is somewhat light," said Jim Maguire, Jr, a floor trader on the New York Stock Exchange at E.H. Smith Jacobs. "It is not as if we are seeing new capital coming into the market. It is again a trader's market."
Maguire added that a short bias going into the open this morning had been chased out when the market held its gains after the uninspiring housing data.
"It's a classic bull and bear struggle," he said.
The Dow Jones industrial average <.DJI> gained 176.11 points, or 1.65 percent, to 10,838.69. The Standard & Poor's 500 Index <.SPX> rose 21.15 points, or 1.88 percent, to 1,145.98. The Nasdaq Composite Index <.IXIC> added 44.22 points, or 1.90 percent, to 2,371.32.
The S&P 500 also retook its 61.8 percent retracement of its April-to-July fall at 1,140, which can be an important level for traders.
For September, the S&P 500 is up 9.2 percent after rallying since the start of the month as data suggested the economy was not on the verge of sliding back into recession as some had feared.
The broad-based index crossed a major resistance level at 1,130 on Monday, but its close below that mark in the last session and light trading volumes have caused some investors to question the move's sustainability.
"The volume isn't indicative of people piling in, there's no mad rush to buy," said Joseph Greco, managing director at Meridian Equity Partners in New York. "We're coming into the end of the quarter and no one wants to get caught short."
Shares of builder KB Home
Nike Corp
On the Nasdaq, Apple Inc
Boosting investor sentiment was the share offering of Brazilian state oil company, Petrobras. The sale of nearly $70 billion in shares surpassed expectations, erasing concerns that stocks were less attractive assets.
U.S. gold futures surged to an all-time high at $1,300 an ounce in European trading on Friday as investors turned to the precious metal as a refuge from volatility in the currency markets.
(Reporting by Edward Krudy; Addtional reporting by Ryan
Vlastelica; Editing by Jan Paschal)
