Mortgage proposal boosts stocks

NEW YORK — Wall Street rallied again Thursday as investors bet that companies hurt by the housing crisis will benefit from another interest-rate cut and a government plan to help financially stretched homeowners.

The Dow Jones industrial average surged 174.93 to 13,619.89.

Microsoft, one of the 30 Dow stocks, rose 40 cents to close at $34.55 a share. Boeing, also a Dow stock, gained $1.08 to $91.78.

Broader stock indicators also extended their gains. The Standard & Poor's 500 index rose 22.33 to 1,507.34, and the Nasdaq composite index rose 42.67 to 2,709.03.

Wall Street, concerned about the housing slump's impact on consumers, started out a bit shaky Thursday when retailers released lackluster sales figures and a downbeat December outlook. However, stocks eventually pushed higher; a weak consumer, though bad for corporate profits, supports the argument for the Fed Reserve to lower interest rates when it meets Tuesday.

Stocks got an additional boost when President Bush announced a plan allowing some homeowners facing foreclosure to not only freeze their interest rates for up to five years, but also refinance their mortgages. The plan could help about 1.2 million homeowners, Bush said.

Ahead of today's report on November payrolls and unemployment, the Labor Department said the number of U.S. workers filing new claims for unemployment benefits fell as expected last week. Still, the four-week average hit a two-year high, suggesting a softening job market.