US STOCKS-Wall St rises on stimulus plan hopes; tech leads

                                
 * Tech shares rise on bets for infrastructure spending
                                
 * Apple slips after uneventful Macworld
                                
 * Alcoa falls after-the-bell; sets job, production cuts
                                
 * Dow up 0.7 pct, S&P up 0.8, Nasdaq up 1.5 pct
                                
 * For up to the minute market news, click [STXNEWS/US]
 (Adds Alcoa after-the-bell, context to Dow)
                                
 By Chuck Mikolajczak
                                
 NEW YORK, Jan 6 (Reuters) - U.S. stocks gained on Tuesday
on the increased likelihood of a government stimulus package
after the release of minutes from the last Federal Reserve
policy meeting painted a dismal picture of the U.S economy.
                                
 Investors bet technology stocks would benefit from
President-elect Barack Obama's proposed economic plan that
would include the largest U.S. infrastructure investment since
the 1950s.
                                
 Microsoft <MSFT.O> added 1.2 percent to $20.76 after the
software maker said it sold 28 million units worldwide of its
Xbox 360 video game console through the end of 2008, extending
the Xbox's lead over rival Sony Corp's <6758.T><SNE.N>
PlayStation 3. [ID:nN05400786].
                                
 The U.S. Federal Reserve, in minutes from its Dec. 15-16
meeting, warned of uncomfortably low levels of inflation and
said the economic outlook will be weak for some time. For
details, see [ID:nnN06439238]
                                
 "There is a little bit of a honeymoon period with the
ushering in of the new calendar year, people are anticipating
bold initiatives in the stimulus package," said Todd Clark,
managing director of stock trading at Nollenberger Capital
Partners in San Francisco.
                                
 "It seems like there is some willingness to take risks
again."
                                
 The Dow Jones industrial average <.DJI> was up 62.21
points, or 0.69 percent, to 9,015.10. The Standard & Poor's 500
Index <.SPX> gained 7.25 points, or 0.78 percent, to 934.70.
The Nasdaq Composite Index <.IXIC> added 24.35 points, or 1.50
percent, to 1,652.38.
                                
 The Dow has risen six of the last eight trading sessions
and is down 28 percent from one year ago.
                                
 Retailers rose ahead of closely monitored same-store sales
figures -- an industry benchmark -- later in the week after the
latest report on U.S. chain stores provided a small sign of
relief. After a dismal holiday shopping season, the data showed
sales rose 1.4 percent last week over the prior period and fell
less than the same week a year earlier. The S&P retail index
<.RLX> rose 2.3 percent.
                                
 Materials and mining companies were among the top advancers
on Tuesday as a global commodities benchmark <.CRB> settled at
its highest level since Nov. 28, helped in part by a rally in
precious and base metals, soft commodities and some energy
futures.
                                
 The S&P index of materials companies <.GSPM> rose 1.9
percent, while an ETF tracking both metal and mining companies
<XME.P> jumped 3.6 percent.
                                
 But in after-the-bell trade, shares of Alcoa <AA.N> sank
after the aluminum producer said it will cut production and
reduce about 13,500 jobs, or about 13 percent of its global
workforce, in an effort to save cash and reduce costs in
response to the economic downturn.
                                
 Shares of Alcoa, a Dow component, were down 4.3 percent in
after-market trade.
                                
 Earlier in the session, weaker-than-expected new orders
received by U.S. factories in November and a seven-year low in
pending home sales for that month spurred concerns about
mounting job losses and the deepening U.S. recession.
[ID:nN06422985]
                                
 Technology shares, which are seen as better prepared to
weather the economic downturn due to large cash reserves, were
a particular bright spot. International Business Machines Corp
<IBM.N> and Hewlett-Packard Co <HPQ.N> pushed the Dow higher,
rising 2.8 percent and 8.2 percent respectively.
                                
 However, after initially rising and helping to lift the
Nasdaq in the wake of an Oppenheimer & Co upgrade, shares of
Apple Inc <AAPL.O> retreated as its performance at the Macworld
expo in San Francisco disappointed investors. Apple, which had
previously introduced the iPhone at Macworld, frustrated
investors with its lack of big news. For more see
[ID:nN06423900].
                                
 Shares of Apple slipped 1.7 percent to $93.02.
                                
 Volume on the New York Stock Exchange totaled about 1.33
billion shares, and about 2.17 billion shares traded on the
Nasdaq.
                                
 Advancers outnumbered decliners on the New York Stock
Exchange by a ratio of about 7 to 2, while on the Nasdaq the
ratio was about five to two.
 (Additional reporting by Deepa Seetharaman; Editing by Leslie
Adler)