U.S. Stocks Rise as Bond Yields Slip; GE, Textron Shares Gain

June 19 (Bloomberg) -- U.S. stocks rose after bond yields fell for a third day, easing concern that higher borrowing costs will restrain consumers and businesses.

Textron Inc., the world's largest maker of corporate jets, sent industrial shares to the biggest gain in the Standard & Poor's 500 Index after Goldman, Sachs & Co. advised clients to buy the shares. General Electric Co., Bank of America Corp. and JPMorgan Chase & Co. led shares of companies that benefit from falling interest rates.

A surge in the 10-year Treasury note's yield to its highest since 2002 pushed stock indexes down from records earlier this month. The benchmark yield, which influences rates on mortgages and corporate loans, has lost more than 0.07 percentage point over the last three days.

``There's a sigh of relief for investors that the spike in yields we saw last week didn't hold or push higher,'' said Scott Armiger, who oversees $350 million as portfolio manager at Greenville, Del.-based Christiana Bank & Trust.

The Standard & Poor's 500 Index added 2.28, or 0.2 percent, to 1533.33 at 1:01 p.m. in New York. The Dow Jones Industrial Average gained 22.93, or 0.2 percent, to 13,635.91. The Nasdaq Composite Index increased 1.39 to 2627.99.

Textron, maker of Cessna jets, rose $3.52 to $112.35. GE, the world's biggest maker of power generators, added $1.05 to $39.12.

The yield on the 10-year note slipped 4 basis points, or 0.04 percentage point, to 5.09 percent on speculation a slump in housing will continue to be a drag on the economy.

Bank of America, the second-largest U.S. bank, gained 77 cents to $50.68. JPMorgan, the third-biggest, rose 41 cents to $50.84.

Bristol-Myers, Expedia

Bristol-Myers Squibb Co. added $1.41, or 4.7 percent, to $31.72. The drugmaker won accelerated U.S. review for its experimental breast-cancer medicine ixabepilone, a new type of treatment for patients whose tumors have spread to other organs.

Expedia Inc. increased $3.63, or 14 percent, to $29.13. The world's largest Internet travel agency plans to spend as much as $3.5 billion buying back up to 42 percent of its common stock. The company will repurchase as many as 116.7 million shares for between $27.50 and $30 a share in a tender offer, Expedia said. $42.77.

Builders broke ground on new houses at an annual rate of 1.474 million last month, 2.1 percent less than April, the Commerce Department said. Housing construction is in its worst recession since 1990-1991, cutting 0.9 percentage point from growth in the first quarter after detracting 1.2 percentage points in the second half of 2006.

Stocks fell yesterday after the National Association of Home Builders/Wells Fargo index of sentiment dropped to its lowest since 1991.