Stocks edge higher in afternoon trading
NEW YORK - U.S. stocks were slightly higher in early afternoon trading Tuesday as investors weighed strong results from Home Depot (HD) and Macy's (M) against an unexpectedly steep decline in consumer confidence this month. The worst declines in confidence came in areas that were most affected by the winter storms and severely cold weather of the last few weeks.
KEEPING SCORE: The Dow Jones industrial average was up 26 points, or 0.2 percent, at 16,233 as of 1:25 p.m. (1825 GMT). The S&P 500 was up two points, or 0.1 percent, to 1,850, a point above the record high it reached on Jan. 15. The Nasdaq composite was up a point at 4,294. Stocks have moved between small gains and losses throughout the day.
SNOWED IN: Macy's rose $2.75, or 5 percent, to $55.82 while Home Depot was up $2.44, or 3 percent, to $80.29. While both companies reported better-than-expected results, both were also affected by the recent winter storms. Macy's said that at one time during January, 30 percent of its stores were shut down because of weather.
"We don't like to use weather as an excuse but we think we probably lost $100 million in the month of January," Home Depot's chief financial officer, Carol Tome, said in a conference call with investors. "Atlanta was frozen, for example. It was tough here."
CONFIDENCE IS ALSO HIT: The Conference Board's index of consumer confidence fell to 78.1 in February from 80.7 the month before. That was below the 80.1 level economists polled by FactSet were expecting. The report is a closely watched indicator of how likely consumers are to spend money and keep the economy moving forward.
The report was the latest indication that the last several weeks of cold weather has slowed economic activity. The regions that had the biggest declines in confidence in February were in the middle of the storm earlier in this month that brought snow from Atlanta to Boston.
"Perhaps (confidence) would have done slightly better had the weather been less dismal," economists at the investment bank RBS wrote in a note to investors.
SICKLY TENET: Hospital management company Tenet Healthcare (THC) fell $5.21, or 11 percent, to $43.09 after the company reported a loss in the fourth quarter. Tenet took on more debt because of an acquisition and a stock repurchase program.
DEFENSE WOES: Shares of several defense contractors fell following Defense Secretary Chuck Hagel's announcement Monday that the size of the nation's armed forces would be reduced to below World War II levels. Northrop Grumman (NOC) fell 1 percent, while Raytheon (RTN) and Lockheed Martin (LMT) fell 0.5 percent.
STILL NEAR A RECORD: The S&P 500 barely missed hitting another record high on Monday. It closed at 1,847.61, less than a point from its record close of 1,848.38 set on Jan. 15. Both the Nasdaq and S&P 500 are positive for 2014, while the Dow is still down 2 percent.