US stocks rise as tech, industrial earns roll in
Strong earnings reports from big U.S. companies helped push the Dow Jones industrial average to its eighth gain in nine sessions Tuesday.
DuPont, Verizon and Travelers Cos., three of the 30 stocks that make up the Dow, closed higher after reporting their financial results for the final quarter of 2012.
The Dow closed up 62.51 points, or 0.5 percent, at 13,712.21. The Standard & Poor's 500 index gained 6.53, or 0.4 percent, to 1,492.51. The Nasdaq composite average rose 8.47, or 0.3 percent, to 3,143.18.
The indexes spent the morning edging between small gains and losses. Around noon, the Dow rose decisively and stayed higher for the rest of the day.
Earnings have been strong enough this season to drive a five-day winning streak for the S&P 500 and put the Dow on track for its biggest monthly percentage gain since October 2011. Jack Ablin, chief investment officer at BMO Private Bank in Chicago, said traders have been encouraged by the number of companies beating analysts' profit expectations.
"Granted, we have diminished expectations, but companies are doing a decent job beating on the profit side," he said. The revenue side of the equation has been weaker, Ablin said, preventing a stronger updraft for stocks. Traders might gain more confidence if companies reported stronger demand from emerging markets and Europe, he said.
"The U.S. has been pulling this wagon by itself for the last couple years, and now we're facing some austerity measures. We could certainly use a hand," he said.
Among the Dow components that reported early Tuesday, chemical and bioscience company DuPont reported a sharp drop in net income on weakness in its electronics, communications and other businesses, but the results still beat analysts' forecasts. DuPont's stock closed up 83 cents, or 1.8 percent, at $47.82.
Johnson & Johnson said higher sales helped boost its profit from a year ago, when results were weighed down by a slew of one-time charges. However, the company's 2013 profit forecast fell short of analysts' estimates. J&J dropped 54 cents, or 0.7 percent, to $72.69.
Verizon Communications Inc. rose after the country's biggest wireless carrier said it activated a record number of new devices on contract-based plans in the fourth quarter. Verizon's net loss widened on restructuring and pension costs and expenses related to the cleanup from Superstorm Sandy. Its stock rose 40 cents, or 0.9 percent, to $42.94.
A fourth member of the Dow 30, property and casualty insurer Travelers Cos., rose strongly after it said core income categories like investments and premiums written rose. Net income fell because of claims filed in the wake of Superstorm Sandy. The stock shot up $1.64, or 2.2 percent, to $77.95, an all-time closing high. Travelers has risen nearly 27 percent over the past 12 months.
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