Created on Monday, 10 December 2012 Written by STEVE ROTHWELL,AP Business Writer
NEW YORK (AP) — Stocks inched higher on Wall Street Monday after a strong sales report from McDonald's helped offset concerns about the surprise resignation of Italy's prime minister, Mario Monti.
The Dow Jones industrial average was up 26 points at 13,181, as of 11:56 a.m. The Standard and Poor's 500 was up two points at 1,420. The Nasdaq composite was up 13 points at 2,991.
McDonald's rose $1.12 cents to $89.56. A key sales figure rose in November as U.S. customers bought more breakfast offerings and limited-time Cheddar Bacon Onion sandwiches.
Robert Pavlik, chief market strategist at Palm Beach, Fla.-based Banyan Partners, said it was encouraging to see signs of strength in the restaurant chain. McDonald's, a member of the Dow average, was trading as high as $100 at the beginning of 2012. The pickup in McDonald's sales, he said, gave investors something positive to focus on as Italy's sudden political turmoil sent a jolt through European markets.
Monti, who has been credited with restoring confidence in Italy's economy, announced that he would step down after former Prime Minister Silvio Berlusconi's party dropped its support. Italian government bond yields, a critical measure of how much the country has to pay to borrow, jumped. Concern that the European debt crisis was enveloping Italy, one of the euro region's largest economies, helped stymie markets around the world earlier in the year.
Investors will also watch for developments in the budget talks in Washington. Automatic tax increases and federal spending cuts are scheduled to start Jan. 1 unless a deal is reached to reduce the U.S. budget deficit. Economists say the measures, if implemented, could push the economy back into recession.
President Barack Obama and House Speaker John Boehner met at the White House Sunday to discuss the budget, while rank-and-file Republicans stepped forward with what they called pragmatic ideas to break the stalemate. The Obama-Boehner meeting Sunday was the first between just the two leaders since Election Day.
Other stocks making big moves;
—Priceline.Com fell $31.9 to $627.10 after Deutsche Bank cut its recommendation on the stock to "hold" from "buy" and lowered its price target to $710 from $800.
—Phillips 66, the refining and pipeline company, gained $1.66 to $54 after saying late Friday that it was raising its quarterly dividend to 31.25 cents per share from 25 cents. The company also said it had approved the repurchase of another $1 billion in company stock, after approving the repurchase of $1 billion of shares during the first quarter.