NEW YORK: US stocks rallied Tuesday amid optimism that Washington was serious about reaching a deal on the "fiscal cliff."
The Dow Jones Industrial Average gained 115.57 points (0.87 per cent) at 13,350.96 in closing trade.
The Standard & Poor's 500 Index was up 16.43 points (1.15 per cent) to finish at 1,446.79. The Nasdaq Composite Index was up 43.93 points (1.46 per cent) to close at 3,054.53.
"Stocks took solace in what appeared to be a step up in the pace of fiscal cliff negotiations," said analysts with Charles Schwab & Co.
President Barack Obama and top Republican John Boehner have stepped up negotiations in recent days in an apparent effort to avert the so-called fiscal cliff -- a combination of tax hikes and spending cuts set to take effect in January.
Apple rose 2.9 per cent. South Korean competitor Samsung said Tuesday it would drop a legal request to ban Apple products in five European countries.
But on Monday, a US judge denied Apple's request to ban a set of Samsung smartphones from the US market after a jury found the South Korean electronics titan guilty of patent infringement.
Google stock was flat at US$721.07 in the wake of word that the European Union will seek an accord with the Internet search giant to resolve anti-trust concerns.
Media audience ratings service Nielsen increased 4.4 per cent after announcing it will buy Arbitron for US$1.26 billion in cash to expand its radio ratings. Arbitron soared 23.6 per cent.
ConocoPhillips, which said it was selling its Algerian business unit, gained 1.8 per cent.
Gunmaker Smith and Wesson Holding Corporation stock dropped roughly 10 per cent amid a US gun control debate sparked by a shooting in Connecticut Friday that saw 27 murdered -- including 20 children -- and shocked the nation.
Another gun maker, Sturm Ruger, lost 7.7 per cent. -- AFP
NEWTOWN, Conn. Family members have gathered for the first of eight funerals for school shooting victims to be held at a Catholic church in Newtown, Conn.
A motorcade of dozens of vehicles led by police motorcycles accompanied the family of 6-year-old James Mattioli to St. Rose of Lima on Tuesday. His funeral comes a day after two other 6-year-old boys were laid in the first of a long, almost unbearable procession of funerals.
Margarita Rosniak and her 10-year-old daughter, Charlotte, watched from the sidewalk as people entered the church. They had traveled from California for a Christmas vacation in New York and came to Newtown to join the residents in their grief.
Clutching her daughter close, Margarita Rosniak spoke of sympathizing with the parents. Her daughter says she plans to do a school project on the massacre. She asks, "What was the point of it? They're just little kids."
Meanwhile, a funeral for another of the 20 innocent children killed - 6-year-old Jessica Rekos - was also scheduled for Tuesday. Her family says she loved horses and had just asked Santa for new cowgirl boots and a cowgirl hat, CBS News correspondent Randall Pinkston reported.
Security remained high, and the small, affluent Connecticut community was still on edge as the rest of the country prepared for the Christmas holidays.
"There's going to be no joy in school," said 17-year-old P.J. Hickey. "It really doesn't feel like Christmas anymore." But he added, "This is where I feel the most at home. I feel safer here than anywhere else in the world."
In a sign of investors distancing themselves from gun makers, private equity firm Cerberus Capital Management announced it would sell its stake in major arms manufacturer Freedom Group. It said in a statement, "It is apparent that the Sandy Hook tragedy was a watershed event that has raised the national debate on gun control to an unprecedented level."
The mystery of why a smart but severely withdrawn 20-year-old, Adam Lanza, shot his mother to death in bed before rampaging through Sandy Hook Elementary, killing 20 children ages 6 and 7, was as deep as ever.
Sandy Hook Elementary will remain closed indefinitely.
Investigators say Lanza had no ties to the school he attacked, and they have found no letters or diaries that could explain why he targeted it. He forced into the school shortly after its front door locked as part of a new security measure. He wore all black and is believed to have used a Bushmaster AR-15-style rifle, a civilian version of the military's M-16. Versions of the AR-15 were outlawed in the U.S. under the 1994 assault weapons ban, but the law expired in 2004.
Debora Seifert, a spokeswoman for the federal Bureau of Alcohol, Tobacco, Firearms and Explosives, said both Lanza and his mother fired at shooting ranges and visited ranges together.
At the White House on Monday, spokesman Jay Carney said curbing gun violence is a complex problem that will require a "comprehensive solution." He did not mention specific proposals to follow up on President Barack Obama's call for "meaningful action."
New York City's billionaire Mayor Michael Bloomberg, perhaps the most outspoken advocate for gun control in U.S. politics, again pressed Obama and Congress to toughen gun laws and tighten enforcement.
"If this doesn't do it," he asked, "what is going to?"
At least one senator, Virginia Democrat Mark Warner, said Monday that the attack has led him to rethink his opposition to the ban on assault weapons. And West Virginia Sen. Joe Manchin, a Democrat who is an avid hunter and lifelong member of the powerful National Rifle Association, said it's time to move beyond the political rhetoric and begin an honest discussion about reasonable restrictions on guns.
In Newtown on Monday, minds were on mourning.
Two funeral homes filled for Jack Pinto and the youngest victim, Noah Pozner, who turned 6 just two weeks ago..
A rabbi presided at Noah's service, and in keeping with Jewish tradition, the boy was laid to rest in a simple brown wooden casket with a Star of David on it.
"I will miss your perpetual smile, the twinkle in your dark blue eyes, framed by eyelashes that would be the envy of any lady in this room," Noah's mother, Veronique Pozner, said at the service, according to remarks the family provided to The Associated Press. Both services were closed to the news media.
Noah's twin, Arielle, who was assigned to a different classroom, survived the killing frenzy.
At 6-year-old Jack Pinto's Christian service, hymns rang out from inside the funeral home, where the boy lay in an open casket.
In the middle of town, an ever-growing memorial has become a pilgrimage site for strangers who want to pay their respect.
One man told CBS Station WCBS why he visited: "Because I'm a dad with four beautiful daughters, when I found out it broke my heart. It's hard to sleep, I don't know how to feel."
Authorities say Lanza shot his mother, Nancy, at their home and then took her car and some of her guns to the school, where he broke in and opened fire. A Connecticut official said the mother, a gun enthusiast who practiced at shooting ranges, was found dead in her pajamas in bed, shot four times in the head with a .22-caliber rifle.
Lanza was wearing all black, with an olive-drab utility vest with lots of pockets, during the attack.
As investigators worked to figure out what drove him to lash out with such fury -- and why he singled out the school -- federal agents said he had fired guns at shooting ranges over the past several years but that there was no evidence he did so recently as practice for the rampage.
Debora Seifert, a spokeswoman for the federal Bureau of Alcohol, Tobacco, Firearms and Explosives, said both Lanza and his mother fired at shooting ranges, and also visited ranges together.
"We do not have any indication at this time that the shooter engaged in shooting activities in the past six months," Seifert said.
Investigators have found no letters or diaries that could explain the attack.
Whatever his motives, normalcy will be slow in revisiting Newtown.
Classes were canceled district-wide Monday, though other students in town were expected to return to class Tuesday.
Dan Capodicci, whose 10-year-old daughter attends the school at St. Rose of Lima Roman Catholic Church, said he thinks it's time for her to get back to classes.
"It's the right thing to do. You have to send your kids back. But at the same time I'm worried," he said. "We need to get back to normal."
Gina Wolfman said her daughters are going back to their seventh- and ninth-grade classrooms tomorrow. She thinks they are ready to be back with their friends.
"I think they want to be back with everyone and share," she said.
Newtown police Lt. George Sinko said whether to send children to school is a personal decision for every parent.
"I can't imagine what it must be like being a parent with a child that young, putting them on a school bus," Sinko said.
The district has made plans to send surviving Sandy Hook students to Chalk Hill, a former middle school in the neighboring town of Monroe. Sandy Hook desks that will fit the small students are being taken there, empty since town schools consolidated last year, and tradesmen are donating their services to get the school ready within a matter of days.
"These are innocent children that need to be put on the right path again," Monroe police Lt. Brian McCauley said.
With Sandy Hook Elementary still designated a crime scene, state police Lt. Paul Vance said it could be months before police turn the school back over to the district.
The shooting has put schools on edge across the country.
Anxiety ran high enough in Ridgefield, Conn., about 20 miles from Newtown, that officials ordered a lockdown at schools after a person deemed suspicious was seen at a train station.
Two schools were locked down in South Burlington, Vt., because of an unspecified threat. A high school in Windham, N.H., was briefly locked down after an administrator heard a loud bang, but a police search found nothing suspicious.
House Speaker John A. Boehner said Tuesday that he will introduce legislation — opposed by Democrats— to raise taxes only on households earning $1 million or more, as a backup plan for avoiding the "fiscal cliff" if his attempts to forge a broader spending agreement with the White House fail.
Negotiations between Boehner and President Obama have made significant progress in recent days, with Boehner agreeing to the idea of raising tax rates on the wealthiest Americans, and Obama saying he could accept tax increases for households earning $400,000 or more per year. That threshold is a concession from the president's campaign pledge to raise rates on those earning at least $250,000, but it remains unacceptable to many Republicans.
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