* Durable goods orders rise unexpectedly
* Consumer sentiment, new home sales add to optimism
* Oil pullback underpins sunnier sentiment
* Dow up 0.4 pct, S&P 500 up 0.6 pct, Nasdaq up 1.1 pct
(Updates to midday, changes byline)
By Steven C. Johnson
NEW YORK, July 25 (Reuters) - U.S. stocks rebounded on
Friday as better-than-expected data on consumer sentiment and
housing and falling oil prices eased concern about the economy
and the outlook for profit growth.
The brighter mood on Wall Street led investors to snap up
stocks in a range of sectors, including technology and
consumer goods, helping the major indexes recover from
Thursday's 2 percent slide.
Shares of big manufacturers, including United Technologies
<UTX.N>, which rose 1.2 percent, were another standout sector
following a report that showed an unexpected jump in orders
for long-lasting durable goods.
The economic data "was good enough news to get some buyers
off the sidelines, and oil's being down brought in even more,"
said Hugh Johnson, chief investment officer at Johnson
Illington Advisors in Albany, New York.
Around midday, the Dow Jones industrial average <>
was up 22.80 points, or 0.20 percent, at 11,372.08, after
earlier reaching an intraday high at 11,443.81. The Standard &
Poor's 500 Index <.SPX> was up 4.75 points, or 0.38 percent,
at 1,257.29. The Nasdaq Composite Index <> was up 18.13
points, or 0.80 percent, at 2,298.24.
Oil dropped nearly $2 <CLc1> to fall below $124 a barrel
at midday, and analysts said a continued decline would be good
news for the economic outlook, stocks and the dollar.
"Supply and demand ultimately call the tune in commodity
prices, and we have had a decline in domestic demand," said
Joseph Battipaglia, market strategist at Stifel Nicolaus in
Yardley, Pennsylvania.
"As long as demand keeps falling, I think you'll see more
pressure on energy prices, and that ultimately is very good
because it helps the consumer get some relief."
Consumer sentiment rebounded unexpectedly this month after
falling to levels last seen in the early 1980s, as tax rebate
checks helped offset high gas prices, while new home sales in
July were not as weak as expected. See: []
Among technology shares, shares of chip maker Qualcomm Inc
<QCOM.O> helped lead gains on the Nasdaq, rising 3.3 percent
to $54.14, after several brokerages raised their price targets
on the stock.
Shares of Juniper Networks Inc <JNPR.O> climbed more than
14 percent to $25.75 after the network equipment maker raised
its full-year outlook and reported a 40 percent rise in
quarterly profit. Shares of rival Cisco Systems Inc <CSCO.O>
gained almost 1 percent to $21.96, off an earlier intraday
high at $22.48.
Apparel retailer Abercrombie & Fitch Co <ANF.N> was down
8.5 percent at $55.26 a day after the firm's chief financial
officer resigned. The S&P retail index was down 0.8 percent.
Shares of Wachovia Corp <WB.N> fell 8.2 percent to $14.41
after Morgan Keegan cut its rating on the bank to
"underperform."
Other financial shares also struggled as investors
continued to book profits after the sector's recent rally.
Bank of America <BAC.N>, the No. 2 U.S. bank, fell 4.2
percent to $29.36, curbing the gains of both the Dow and the
S&P. For the week, though, the stock is up almost 7 percent.
The heaviest weight on the Dow was International Business
Machines <IBM.N>, down 1.3 percent at $128.29 a week after
reporting much stronger-than-expected earnings. Even with
Friday's decline, IBM is up almost 19 percent for the year to
date.
(Additional reporting by Ellis Mnyandu; Editing by Jan
Paschal)
