Stocks turned from negative to positive on Wall Street over the course of Tuesday at the start of a busy week for corporate earnings after major indexes notched five-year highs.
In afternoon trading, the Standard Poor’s 500-stock index was 0.3 percent higher, the Dow Jones industrial average added 0.3 percent, and the Nasdaq composite index rose 0.1 percent. Both the Dow and S.P. 500 closed last week at their highest levels so far in this earnings season, with the gains largely coming on better-than-expected results.
But despite bullish statements from major companies, including big banks, many investors were worried other reports would reflect economic uncertainty in the fourth quarter.
“The market has been pleased with earnings thus far, and it is encouraging to see a cyclical company like DuPont show revenue strength,” said Adam Sarhan, chief executive of Sarhan Capital in New York, “but I’m waiting on more tech and energy earnings until I come down one way or the other on this season.”
DuPont reported revenue that was ahead of Wall Street expectations, sending shares up 0.9 percent. However, slumping demand for pigment and solar panel parts hurt fourth-quarter profit.
Travelers Companies gained 3 percent after forecasting higher premiums across its businesses, though it also posted earnings that fell by half from insurance losses related to Hurricane Sandy.
Johnson Johnson, the diversified health company, fell 0.8 percent after forecasting 2013 earnings below expectations, while Verizon Communications gained 0.6 percent after reporting a steep loss on pension liabilities and charges related to Hurricane Sandy.
All four companies are Dow components.
Over all, fourth-quarter earnings among the S.P. 500 companies are forecast to have risen 2.5 percent, according to Thomson Reuters data. That estimate is above the 1.9 percent forecast from a week ago but well below the 9.9 percent fourth-quarter earnings forecast from Oct. 1, the data showed.
Monday was a market holiday for Martin Luther King Jr.’s Birthday in the United States. President Obama, at his inauguration for a second term on Monday, called for aggressive action on climate change, economic equality and the federal budget.
Markets have recently been pressured by uncertainty stemming from Washington about the federal debt limit and spending cuts that could hamper American economic growth. Republican leaders in the House of Representatives said they aim to pass on Wednesday a nearly four-month extension of the country’s debt limit, allowing the government to borrow enough to meet its obligations during that period.
In New York trading, Research in Motion jumped 10.6 percent a day after its chief executive said the company may consider strategic alliances with other companies after introducing devices powered by RIM’s new BlackBerry 10 operating system.
Article source: http://www.nytimes.com/2013/01/23/business/daily-stock-market-activity.html?partner=rss&emc=rss
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