Dow rises sharply; dollar gets stronger

NEW YORK -- Wall Street shot higher Thursday as investors, while anticipating another dismal jobs report today, viewed the rising dollar and falling oil prices as promising signs for the economy.

The Dow Jones industrial average rose nearly 190 points to finish above 13,000 for the first time since Jan. 3.

The dollar rose on better-than-expected economic data and the Federal Reserve's apparent resolve to monitor inflation. The Commerce Department said consumer spending rose 0.4 percent in March, more than predicted, and the Institute for Supply Management said U.S. manufacturing contracted in April by a bit less than anticipated.

The readings were not all positive -- consumer spending rose mainly due to rising energy and food prices. The ISM's report also indicated that companies are hurting from climbing costs.

But the dollar, which has recently strengthened after a protracted decline, rallied anyway, pushing the euro down more than 1 percent to $1.5461 in late trading. The dollar's advance helped crude oil fall briefly near $110 a barrel and then settle at $112.52. That alleviated some of the inflation-related anxieties in the market, given that crude recently traded at a record near $120 a barrel.

The dollar's rise comes a day after the Fed lowered key interest rates by a quarter-point, but suggested the economy should keep growing moderately, while inflation is the growing concern.

"What we're seeing is that maybe the economy is not falling off a cliff, but perhaps leveling off," said Peter Cardillo, chief market economist at New York-based brokerage house Avalon Partners Inc. "I think the Fed (rate-cutting campaign) is over with, even though the Fed's statement didn't say that."