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Budget optimism buoys stocks

Optimism that President Barack Obama and congressional leaders will reach a deal on the budget deficit and avoid the "fiscal cliff" helped stocks notch their first advance in four days.

The market started lower Friday but spiked higher shortly before midday as the top members of the House and Senate spoke at the White House following a closed-door session with Obama. House Speaker John Boehner and Senate Minority Leader Mitch McConnell both said they offered higher tax revenue as part of a deal. Boehner said he outlined a framework that is consistent with Obama's call for a "balanced" approach of both higher revenue and spending cuts.

"It's a good start . . . the fact that they were all standing together," said Ben Schwartz, the chief market strategist at Lightspeed Financial, a Manhattan-based broker.

The Dow Jones industrial average closed up 45.93 points to close at 12,588.31, after falling 71 points at midmorning. The Standard & Poor's 500 index rose 0.48 percent to 1,359.88, and the Nasdaq rose 0.57 percent to 2,853.13. The Dow still ended lower for the week, logging a fourth straight weekly decline. The index's gains for the year are at 3 percent. -- AP


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