* U.S. consumer confidence hits highest since October 2007
* Best Buy tumbles after results, DSW rises
* Indexes up: Dow 0.4 pct, S&P 0.3 pct, Nasdaq 0.3 pct (Updates to midday trading)
By Ryan Vlastelica
NEW YORK, Aug 26 (Reuters) - U.S. stocks rose on Tuesday,with both the Dow and S&P 500 hitting fresh intraday records onthe back of strong consumer data suggesting the market'slong-running rally could continue.
The day's gains were broad, with only the telecom and utility sectors lower on the day. Both groups areviewed as defensive plays that underperform in periods ofeconomic expansion. Energy shares, which are highlycorrelated to the pace of growth, led the day's gain with a 0.8percent advance.
The S&P climbed back above 2,000, which it had breached forthe first time on Monday. With Tuesday's move, both the Dow andthe S&P have risen in 10 of the past 13 sessions, while theNasdaq is up for 11 of the past 13 sessions. However, much ofthe market's recent gains have come on low volume, suggestingmany traders may be reluctant to jump in at current levels.
"It's hard to read too much into today's activity, sincevolume is so low. People aren't going to do anything tooaggressive until there's some kind of catalyst, either positiveor negative," said Michael O'Rourke, chief market strategist atJonesTrading in Greenwich, Connecticut. "We're still in anuptrend, but it will be tough to move significantly higher fromhere."
U.S. consumer confidence rose more than expected in August,climbing to its highest since October 2007. Separately, U.S.durable goods orders jumped 22.6 percent in July, the biggestgain on record, though the number was skewed by stronginternational demand for aircraft. Excluding transportation,orders fell 0.8 percent.
The market's momentum is still seen as intact and the S&P'sprice-to-earnings ratio is within historical norms, leading manyanalysts to believe stocks are not overvalued. Nonetheless,pronounced further gains may be a challenge amid potentialheadwinds such as a reduction in Federal Reserve stimulus and asimmering conflict between Ukraine and Russia.
The Dow Jones industrial average rose 66.4 points or0.39 percent, to 17,143.27, the S&P 500 gained 6.1 pointsor 0.31 percent, to 2,004.02 and the Nasdaq Composite added 15.00 points or 0.33 percent, to 4,572.35.
Best Buy Co Inc fell 5.1 percent to $30.35 after theelectronics retailer reported second-quarter revenue that missedexpectations and forecast a drop in same-store sales in thesecond half of the year. DSW Inc rose8.5 percent to $30.79 after adjusted earnings topped forecasts.
Digital Ally Inc extended its meteoric rise,climbing 17 percent to $14.62 on heavy volume. The recent fatalpolice shooting of an unarmed black teenager in Missouri hasfueled interest in the company's wearable camera, and the stockhas almost quadrupled this month alone.
Amazon.com Inc late Monday agreed to buylive-streaming gaming network Twitch Interactive for about $970million in cash. Shares (Frankfurt: DI6.F - news) rose 2.3 percent to $341.84. (Editing by James Dalgleish)
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