Wall St up as tech strength offsets weak data

By Deepa Seetharaman

NEW YORK (Reuters) - Strength in the tech sector boosted U.S. stocks on Tuesday, overshadowing data showing slumping factory orders and dismal pending home sales.

Apple Inc helped drive the Nasdaq higher for a second day after Oppenheimer & Co upgraded the stock, saying Chief Executive Steve Jobs' letter to investors about his health allayed concerns of an unplanned leadership change.

Investors also bet technology stocks would benefit from President-elect Barack Obama's proposed economic plan that would include the largest U.S. infrastructure investment since the 1950s.

"The prospects are slightly better for producers of computerware. Tech stocks are also receiving a boost from the Obama initiative to spend on technology infrastructure," said Andrew Wilkinson, senior market analyst at Interactive Brokers Group in Greenwich, Connecticut.

International Business Machines Corp (IBM.N: Quote, Profile, Research) and Hewlett-Packard Co (HPQ.N: Quote, Profile, Research) pulled the Dow higher, rising 2.5 percent and 4.5 percent respectively.

The Dow Jones industrial average rose 68.34 points, or 0.76 percent, at 9,021.23 and the Standard & Poor's 500 Index gained 8.87 points, or 0.96 percent, at 936.32. The Nasdaq Composite Index rallied 24.41 points, or 1.50 percent, at 1,652.44.

Oil prices rose, pushing energy shares higher. Chevron gained nearly 2 percent.

Still, weaker-than-expected new orders received by U.S. factories in November and a seven-year low in pending home sales for the same month spurred concerns about mounting job losses and the deepening U.S. recession.