U.S. Stocks Solidly Ahead As Oil Falls, Confidence Rises

NEW YORK (MarketWatch) - U.S. stocks on Tuesday stepped solidly higher, rebounding from the prior session's sharp drop, as consumer confidence rose and as the price of crude declined, while Merrill Lynch & Co. said it would write down additional bad debt.

The major stock indexes added to their gains after data showing a better-than-forecast rise in consumer confidence.

The Dow Jones Industrial Average rose 114.64 points to 11,244.74, with 26 of its 30 components trading higher, with the gains led by General Motors Corp. , up 6%.

The S&P 500 rose 11.17 points to 1,245.54, while the Nasdaq Composite added 30.96 points to 2,295.18.

Ahead of the opening bell, Standard & Poor's reported home prices in 20 U.S. cities fell a record 15.8% in the past year. .

The dollar shrugged off the downbeat housing data, with the dollar index at 72.983, compared to 72.694 in late U.S. trading Monday.

Shares of Merrill Lynch fell in the wake of the brokerage's announcement late Monday that it would sell $8.5 billion in new stock to help cover losses from billions of dollars of bad investment. .

In early action on the New York Mercantile Exchange, crude-oil futures for September delivery fell $2.8 to $121.90. .

By Kate Gibson