U.S. Stocks Gain Altitude With Lift From Boeing Results

NEW YORK (MarketWatch) -- U.S. stocks on Wednesday turned higher after a rocky start, with better-than-forecast profit at aircraft manufacturer Boeing Co. helping to spark investor optimism after two sessions of losses.

"The excuses will be Boeing is having a big day, and there are other decent earnings," said Al Goldman, chief market strategist at Wachovia Securities, who pointed to EMC Corp. and Broadcom Corp.

However, Goldman believes the underlying situation is one of "a market that is bottoming out of the bear market that started in October."

The Dow Jones Industrial Average gained 42.99 points to end at 12,763.22, with 18 of its 30 components tallying gains, which were led by Boeing , up 4.5% after it reported a 38% profit rise.

"Certainly things are not falling off the table as far as earnings go; originally the season started roughly with GE (General Electric Corp.) -- on the thinking that 'if GE can't make it nobody can,' but as more and more come through," the situation seems far less dire, said Bill Stone, chief investment strategist, PNC Institutional Investment Group.

Blue-chip decliners included American International Group Inc. , off 3.1% after news of a $6.2 billion deal by Liberty Mutual Insurance Co. to acquire Safeco Corp. to create the nation's fifth-biggest property and casualty insurer. .

Shares of Safeco ascended 45.8%.

"Mergers and acquisitions have seemingly restarted again with the Safeco deal, which makes everybody feel better," said Stone.

The S&P 500 rose 3.99 point to 1,379.93, with information technology advancing the most, up 2%, followed by telecommunications, up 1.8%.

Declining sectors on the S&P had energy down 1.2%, and financials, off 1.1%.

The technology-led Nasdaq Composite advanced 28.27 points to 2,405.21, bolstered in part by VMware Inc. , which offered an upbeat first-quarter earnings report and outlook late Tuesday, while expectations were high for results from Apple Inc. scheduled for after the close. .

Shares of Broadcom were up 16.3%, with analysts citing solid first-quarter results. .

EMC reported a first-quarter profit that fell 14% from a year ago, but pegged the decline largely to acquisition-related costs. .

Crude moves

On the New York Mercantile Exchange, crude-oil futures ended slightly higher, rising 23 cents to settle at $118.30 a barrel, after soaring to record highs just under $120 a barrel the previous session. .

The weekly petroleum supplies count drove energy shares down, with Dow component Exxon Mobile Corp. off 0.2%. .

Elsewhere on the NYME, gold futures accelerated their losses, under pressure as the dollar climbed against major currencies, with gold for June delivery dropping $16.2 to $909 an ounce. .

Ambac Financial reported a $1.66 billion loss, while WellPoint Inc. cut its earnings outlook for a second time this year.

Shares of United Parcel Service Inc. edged lower, closing off 0.3%, after the globe's biggest package-delivery company offered a less-than-positive outlook on the economy.

U.S. stocks slumped on Tuesday on disappointing results and guidance from technology players including Texas Instruments Inc. and consumer stocks like Coach Inc. .


By Kate Gibson
  • CBSNews

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