Investors are finding more than one way to bet on an improving economy.
Stocks ended a quiet day mostly higher Tuesday as traders pushed money into commodity and technology stocks.
Prices for commodities rose, reflecting hopes that economic activity will pick up and lead to greater appetite for basic materials. A falling dollar also helped push commodity prices higher, and oil settled above $70 a barrel for the first time since November.
Technology shares, meanwhile, rose more than the rest of the market as an improved profit forecast from chipmaker Texas Instruments raised hopes that demand could also increase for other kinds of technology goods.
Financial shares were mixed as traders absorbed an announcement from the Treasury Department that it would allow 10 large banks to repay $68 billion in federal bailout money. Those banks are among the 19 given money from a rescue fund created last October at the height of the financial crisis.
The news on the bailout repayments was encouraging for the troubled financial industry, but also widely expected. President Obama welcomed the news but also cautioned that much was left to do to repair the nation's banks.
"It's part of the healing process," said Rob Lutts, chief investment officer at Cabot Money Management in Salem, Mass.
A successful government auction of three-year notes pushed interest rates lower. The robust demand for government debt reassured investors who have worried in recent weeks that rising interest rates would choke off a recovery by making it more expensive for consumers to get loans.
Another key test of investor appetite for Treasury debt is coming up on Wednesday with an auction of $19 billion in 10-year notes. Yields on those notes are closely tied to home mortgages and a closely watched barometer for long-term lending rates.
Bonds were mixed. The benchmark 10-year Treasury note rose, pushing its yield down to 3.86% from 3.89% late Monday.
Analysts said the third consecutive day of quiet trading in the market was a welcome sign after a 39.3% surge in the Standard & Poor's 500 index over the past three months, when it hit 12-year lows.
Many market watchers have been expecting more weakness in stocks if the market hears disappointing news on the economy, and some doubt that there's enough positive news coming to resume the forward march.
"The next three months are just going to be a long, hot flat summer. I don't see a catalyst," said Scott Armiger, portfolio manager at Christiana Bank & Trust in Greenville, Del.
The Dow Jones industrial average fell 1.43, or less than 0.1%, to 8,763.06. The broader S&P 500 index rose 3.29, or 0.4%, to 942.43, and the technology-heavy Nasdaq composite index rose 17.73, or 1%, to 1,860.13.
Banks have been eager to get out of the government's bailout program in part to avoid restrictions on executive pay. American Express Co. rose $1.28, or 5%, to $26.93, while JPMorgan Chase & Co. slipped 13 cents to $35.26.
Texas Instruments rose $1.25, or 6.3%, to $21.02.
Aluminum producer Alcoa rose 38 cents, or 3.5%, to $11.15 and U.S. Steel rose $2.76, or 7.9%, to $37.82. In energy, Schlumberger rose $1.52, or 2.7%, to $58.85.
In other trading, the Russell 2000 index of smaller companies rose 3.14, or 0.6%, to 527.93.
About three stocks rose for every two that fell on the New York Stock Exchange, where volume came to 1.1 billion shares, essentially flat with Monday.