Rate-cut hopes push stocks up

NEW YORK — Stocks extended their rebound from the big summer slump Tuesday after dips in manufacturing growth and construction spending raised investors' hopes for an interest-rate cut.

The Dow Jones industrial average rose 91.12 to 13,448.86. The blue-chip index is about 4 percent below its record close of 14,000.41 July 19 but about 4.7 percent above its summer closing low of 12,845.78 reached Aug. 16.

The biggest gainer among the 30 Dow companies was General Motors, which rose $1.18, or 3.8 percent, to $31.92 after reporting a surprising increase in August sales.

Microsoft, one of the Dow stocks, added 8 cents to close at $28.81 a share. Boeing, also a Dow stock, fell 78 cents to $95.92.

Broader stock indicators also advanced. The Standard & Poor's 500 index added 15.43 to 1,489.42, and the technology-dominated Nasdaq composite index surged 33.88 to 2,630.24.

The market also got a boost as investors bought technology stocks viewed as bargains after being battered during last month's sell-off. Tech and telecom are still seeing takeover activity despite credit concerns; demand for computers, cellphones and other such products appears strong.

The Institute for Supply Management said the manufacturing sector expanded more slowly in August than in July, and the Commerce Department said construction activity fell in July by 0.4 percent. Wall Street was pleased that the snapshots were neither too weak nor too strong — suggesting the economy isn't falling apart, but that the Fed will remain inclined to cut the benchmark federal-funds rate when it meets Sept. 18.