Stocks Rise After Solid Corporate Earnings Reports

Strong earnings reports from big United States companies helped push the Dow Jones industrial average to its eighth gain in nine sessions on Tuesday.

DuPont, Verizon and the Travelers Companies, 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-stock index gained 6.56 points, or 0.4 percent, to 1,492.56. The Nasdaq composite average rose 8.47 points, or 0.3 percent, to 3,143.18.

The indexes spent the morning showing 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 had been encouraged by the number of companies beating analysts’ expectations for profit. “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, Mr. Ablin said, preventing a stronger updraft for stocks. Traders might gain more confidence if companies were to report 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, the chemical and bioscience company DuPont reported a sharp decline 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 raise its profit from a year ago, when results were weighed down by a spate of one-time charges. The company’s 2013 profit forecast, however, fell short of analysts’ estimates. The company’s share price dropped 54 cents, or 0.7 percent, to $72.69.

Shares of Verizon Communications 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 Hurricane Sandy. Its stock rose 40 cents, or 0.9 percent, to $42.94.

A fourth member of the Dow 30, the Travelers Companies, the property and casualty insurer, rose strongly after it reported a rise in core income categories like investments and number of premiums written. Net income fell because of claims filed after Sandy. The stock rose $1.64, or 2.2 percent, to $77.95. .

The Treasury’s benchmark 10-year note slipped 1/32, to 98 2/32, and the yield finished at 1.84 percent, unchanged from late Friday.

Article source: http://www.nytimes.com/2013/01/23/business/daily-stock-market-activity.html?partner=rss&emc=rss