Google Leads Dow Toward 13,000 Milestone
Wall Street bounded higher Friday after Google Inc. led a series of stronger earnings reports that propelled the Dow Jones industrials further into record terrain and toward its first assault on the 13,000 mark.
In midday trading, the Dow Jones industrial average was up 101.18, or 0.79 percent, at 12,909.81, after setting a new intraday high of 12,950.44. The blue-chip index has hit 33 record closes since the beginning of October last year.
After tempering their expectations for the first-quarter, investors have been pleasantly surprised by the initial torrent of earnings reports, helping major indexes rebound from February's market plunge. The Nasdaq composite and Standard & Poor's 500 are both at six-year highs.
So far, 16 of the 30 Dow components have posted financial results for the first three months of the year — with 10 surpassing analyst forecasts. Dow components Honeywell International Inc., Pfizer Inc., Caterpillar Inc. and McDonald's Corp. all reported results before the open.
Google reported late Thursday a 69 percent jump in first-quarter profit to exceed analysts' expectations, expanding its lead in the global market for Internet search advertising, reports CBS News correspondent Alexis Christoforous. The results helped reassure some investors who had grown cautious about the technology sector after disappointing earnings earlier in the week from companies such as Yahoo Inc.
"The main impetus has been, most of the bears and the gloom-and-doomers thought that first-quarter earnings would stink. Once again, the Gloomy Gusses have been proven wrong," said Alfred E. Goldman, chief market strategist at A.G. Edwards & Sons Inc. in St. Louis.
"However, the market has come an awfully long away in a short period of time," he added. "Some short-term caution is called for."
The rally was solidly anchored by some of the biggest companies in the world, all components of the Dow.
Caterpillar was the Dow's biggest mover after the manufacturer of heavy construction and mining equipment posted better-than-expected quarterly profit and issued robust profit guidance. Shares rose $3.33, or 4.9 percent, to $71.95.
Honeywell International rose $1.54, or 3.1 percent, to $50.60 after the aerospace company topped Wall Street projections.
Google jumped after beating expectations, which it has done 10 out of 11 quarters since its initial public offering. The stock rose $12.05, or 2.6 percent, to $483.70.
McDonald's reported quarterly profit rose 22 percent, but its shares dipped. Pfizer reported one-time charges that pushed profit lower by 18 percent, but the results beat expectations.
Overseas, Japan's Nikkei stock average closed up 0.42 percent. In afternoon trading, Britain's FTSE 100 was up 0.97 percent, Germany's DAX index rose 1.49 percent, and France's CAC-40 advanced 2.02 percent.