Stocks turn higher as investors set aside some unease over consumer spending, banking sector

NEW YORK — Stocks turned higher Friday as investors set aside lingering concerns about the economy and considered whether the market's downtrodden mood in recent weeks has left stocks oversold.

Stocks have fallen in six of the past seven sessions as investors have fretted about whether consumers would succumb to higher energy costs, rising mortgage costs and an anemic dollar. Continuing credit turmoil has also stirred concerns about the soundness of corporate balance sheets and profits.

Financial stocks fell, partly due to a Fortune online story that raised the possibility the mortgage lender could be masking the true magnitude of credit-related hits to its profits. Fannie Mae executives, in a conference call with Wall Street analysts, defended how the mortgage lender discloses losses on home loans.

But tech storcks fared better. Investors have at times viewed technology companies as perhaps more likely to emerge unscathed from an economic downturn than some groups such as retailers. Cisco Systems Inc., the world's largest network equipment company, said Friday it plans to repurchase an additional $10 billion in stock.

Meanwhile, rising oil prices gave a boost to energy names such as Exxon Mobil Corp. and ConocoPhillips.

"You can certainly come up with a list of the top 10 reasons why we should be down today," said Art Hogan, chief market strategist at Jefferies & Co. in Boston. He contends the rally indicates the market is oversold.

"I think that's being clearly reflected as we rally into what otherwise would be considered negative catalysts."

In midday trading, the Dow Jones industrial average rose 65.60, or 0.50 percent, to 13,175.65.

Broader stock indicators also rose. The Standard & Poor's 500 index rose 5.47, or 0.38 percent, to 1,456.62, and the Nasdaq composite index rose 8.46, or 0.32 percent, to 2,626.97.

Despite the rally by the major indexes, declining issues outnumbered advancers by about 3 to 2 on the New York Stock Exchange, where volume came to 844.5 million shares.