updated 2/2/2006 7:08:42 AM ET 2006-02-02T12:08:42

Stocks rallied Wednesday after oil futures fell by more than $1 a barrel and Dow Jones industrial Boeing Co. said its earnings had more than doubled .

Major Market Indices

A late afternoon tumble in oil prices sent stocks higher in the final hour of trading. Oil fell $1.36 a barrel to settle at $66.56 on the New York Mercantile Exchange.

Stocks had stayed in a tight range most of the day, following Google Inc.’s fourth-quarter earnings , which missed analysts’ estimates, the first time the company hasn’t pleasantly surprised investors since its August 2004 initial public offering. It closed down $30.88, or 7.1 percent, at $401.78, losing more than $9 billion in market capitalization in a day.

Analysts were reassured by the fact that the overall market, which traded in a tight range during January, wasn’t overwhelmed by Google’s results.

“The fact that the market is continuing to stay at the upper end of the trading range, even with oil prices continuing to hover around their highs is positive, it indicates investor confidence,” said Peter Cardillo, chief strategist, senior vice president and market analyst, S.W. Bach & Co.

The Dow Jones industrial average was up 89.09 points, or 0.82 percent, at the close, while the broader Standard & Poor’s 500-stock index added 2.38 points, or 0.19 percent, and the Nasdaq composite index gained 4.74 points, or 0.21 percent, despite Google’s decline.

Bonds fell as investors mulled possible future Fed rate hikes, with the yield on the 10-year Treasury note rising to 4.57 percent from 4.52 percent late Tuesday. The U.S. dollar was higher against other major currencies in European trading. Gold prices fell.

Google’s tumble continued a trend the market has seen in recent weeks: Stocks that disappoint fall hard. Some that have taken a recent beating, such as General Electric Co. and Citigroup Inc., have yet to recover.

“There’s ‘hot money’ — hedge fund money, more aggressive money — if they sense anything out of the ordinary, they bail out quickly, en masse,” said Ralph Acampora, managing director of technical research at Knight Capital Group Inc., an asset management firm.

The market may look placid, Acampora said, but “the point is that there’s selling under the surface, there’s some profit taking and some of it is nasty.”

In economic news, the Institute for Supply Management said manufacturing grew in January, but at a slower pace than December . The group said deliveries of goods are slowing and prices are increasing.

Some investors are rooting for a cooling economy, which would give the Fed a firm reason to end its streak of short-term interest rate hikes . They fear that continued rate hikes could push the economy into a recession.

Boeing Co. rose $3.31 to $71.62 after it said fourth-quarter earnings more than doubled as the huge aerospace company’s resurgent commercial airplane division posted strong gains. The company also raised its profit outlook for 2006, citing better operating performance.

Media conglomerate Time Warner Inc.’s stock rose 69 cents to $18.22 after it said profits rose 21.2 percent in the fourth quarter on strong results from the company’s cable TV, movie studios and cable networks businesses.

Shares of Tribune Co., one of the nation’s largest owners of newspapers and TV stations, hit a five-year low after the company’s fourth-quarter profit fell 38 percent, hurt by a spate of charges related to work-force cuts and the shutdown of a production plant. The stock fell 30 cents to $28.71.

JetBlue Airways Corp. fell $1.86 to $11.18 after it said its fourth-quarter loss widened, as increased revenue could not offset the impact of sharply higher fuel costs. The airline also forecast losses for the first quarter and full year 2006 .

UAL Corp.’s United Airlines formally exited bankruptcy protection Wednesday when it filed papers with the U.S. Bankruptcy Court. The stock will trade on the Nasdaq with the ticker symbol UAUA; it was trading on a when-issued basis at $43, up $1.02.

Overseas, Japan’s Nikkei stock average fell 1.02 percent. Britain’s FTSE 100 rose 0.72 percent, Germany’s DAX index gained 0.92 percent, and France’s CAC-40 rose 1.04 percent.

© 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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