Wall St up on recovery hopes

New York - Wall Street regained its upward momentum on Friday on economic recovery hopes but investors were cautious over earning potential of companies that have reeled from prolonged recession.

The Dow Jones Industrial Average rose 31.44 points (0.32%) to 9 815.06 a day after investors locked in profits and took a breather after a long market rally.

The Nasdaq composite climbed 3.63 points (0.17%) to 2 130.38 and the broad-market Standard & Poor's 500 index added 2.68 points (0.25%) to 1 068.17.

Stock volume and volatility picked up Friday due end of quarter option expiration of futures and options on stocks and stock indexes, market analysts said, cautioning against profit taking on any slight opportunity.

"We believe a big part of the rally lately has been due to aggressive traders and hedge funds," said Wells Fargo chief market strategist Al Goldman.

"Those folks can change their minds quickly," he added.

Fresh government data showed the United States was beginning to recover from recession since December 2007.

On Thursday, reports showed new claims for unemployment benefits falling for the second consecutive week and home construction and building permits rising in August.

But analysts said company earnings remained a concern.

"All week there has been a slow trickle of calendar third quarter earnings that overall have failed to live up to expectations," said Patrick O'Hare of Briefing.com.

"Whether those expectations have been raised too far reflecting more the equity markets' view of the economic recovery versus reality remains in question," he said.