updated 9/13/2006 9:22:28 AM ET 2006-09-13T13:22:28

Wall Street rallied for a third straight session Tuesday, propelling the Dow Jones industrials up more than 100 points on strong earnings from Goldman Sachs and optimism over falling oil prices.

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As oil prices fell for a seventh straight session, investors pushed shares of consumer-oriented stocks higher. Companies such as General Motors, home improvement chain Home Depot and Best Buy all showed strong gains.

“Oil prices and commodity prices are coming down, and if that continues we could be headed for a strong fourth quarter,” aid Peter Cardillo, chief market analyst at S.W. Bach & Co.

Investors also saw positive momentum from financial services stocks after Goldman Sachs reported better-than-expected third-quarter results, although profits fell as its trading business slowed. Not only did Goldman’s earnings bode well for rival investment banks due to report this week, but they also signaled that companies have not pulled back from going to the markets with equity deals.

The rally helped lift the Dow to a fourth-month high, and the Nasdaq composite index and Standard & Poor’s 500 index to three-month highs.

The Dow rose 101 points or 0.9 percent, while the the Nasdaq was up nearly 2 percent.

Cardillo said Wall Street traders decided not to dwell on a record trade deficit figure released Tuesday. The Commerce Department reported the trade deficit ballooned to $68 billion in July amid high oil prices.

Stronger consumer sentiment helped propel General Motors up $1.39, or 4 percent, to $33.23, a 52-week high. Home Depot added $1.60, or 4.6 percent, to $36.66.

Best Buy, which reported second-quarter profit rose 22 percent , advanced $4.37, or 9 percent, to $52.14. Goldman Sachs, which beat earnings projections, rose $7.29, or 4.8 percent, to $158.29.

News came just as the market opened that Bristol-Myers Chief Executive Peter Dolan and the company’s general counsel would both be leaving the company . Dolan was sharply criticized for the company’s conduct related to a failed agreement with Canadian drug maker Apotex to keep a generic version of Bristol’s No. 1 drug, Plavix, off the market. The company said Tuesday it did not find it had done anything wrong, which appeared to put investors at ease.

Bristol-Myers rose $1.06, or 4.5 percent, to $24.45.

Meanwhile, Hewlett Packard announced that Patricia Dunn will step aside as chairwoman Jan. 18 and will be succeeded by CEO Mark Hurd. Dunn apologized for inappropriate techniques employed in an investigation of leaks to the media; the inquiry delved into phone records of board members and reporters. H-P advanced 56 cents to $36.92.

The decisions announced Tuesday came as little surprise following controversy at both companies.

Apple Computer Inc. saw a modest lift after announcing a series of new products, including a way to beam video to televisions and an iPod Nano with a longer battery life.

Advancing issues outnumbered decliners by about 3 to 1 on the New York Stock Exchange, where volume came to 1.80 billion shares, compared with 1.68 billion traded Monday.

Overseas, Japan’s Nikkei stock average closed down 0.48 percent. Britain’s FTSE 100 was up 0.76 percent, Germany’s DAX index rose 1.30 percent, and France’s CAC-40 was up 1.34 percent.

Bonds also advanced, with the yield on the benchmark 10-year Treasury note falling to 4.77 percent from 4.80 percent Monday. The dollar was mixed against other major currencies, while gold prices fell after falling below $600 an ounce Monday for the first time in more than two months.

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