U.S. Markets open in 2 hrs 6 mins

Strong earnings from AT&T, 3M lift US stocks

Daniel Wagner, AP Business Writer

In an April 16, 2012 photo trader Damian Bagarozza left, and specialist Joseph Mastrolia work on the floor of the New York Stock Exchange. Wall Street was headed for a higher open Tuesday April 24, 2012, with Dow Jones industrial futures gaining 0.2 percent and S&P 500 futures up 0.3. (AP Photo/Richard Drew)

Solid U.S. corporate earnings and higher spirits in Europe propelled the Dow Jones industrial average to a triple-digit gain Tuesday.

AT&T and 3M led the Dow higher after reporting better-than-expected profits. Hershey also beat Wall Street's expectations. The chocolate maker's stock rose the most of any in the Standard & Poor's 500 index.

Apple, the biggest company by market value, will report its quarterly earnings after the close. Its stock fell sharply, limiting gains for the tech-heavy Nasdaq composite index.

The gains for blue chips were broad. Seven of the 30 stocks in the Dow gained 1.5 percent or more. Only four fell. Among them was Wal-Mart Stores, still reeling after reports over the weekend that top company officials knew about widespread bribery of foreign officials.

European stocks rallied into the close a day after one of their worst drops in months. Monday's selling followed fears that deficit-cutting agreements by some nations are close to unraveling.

On Tuesday, interest rates on Spanish bonds already in circulation declined as Monday's panicked atmosphere dissipated. France's CAC-40 index closed up 2.3 percent. Germany's DAX rose one percent, London's FTSE 100 0.8 percent.

Still, Europe's troubles are far from resolved. One sign: Bond investors demanded much higher interest rates from Spain and Italy when they auctioned new debt, signaling more pain ahead for those debt-strapped countries.

The Dow rose 100 points to 13,027 as of noon EDT. It was led by AT&T 3M, GE, Verizon, Pfizer and IBM. IBM said it is raising its quarterly dividend and plans to repurchase $7 billion more of its stock.

The S&P 500 rose six points to 1,373. The Nasdaq composite average fell two to 2,968.

The Nasdaq was dragged lower by Apple, which fell 2 percent.

As stocks rose, traders sold ultra-safe Treasurys. The yield on the 10-year Treasury note rose to 1.96 percent from 1.94 percent late Monday.

Among the other U.S. companies swinging on earnings news:

— Baker Hughes, an oilfield service contractor, leapt 7 percent after its profit exceeded expectations because of strong drilling activity in Africa.

— Regions Financial surged 5 percent after the bank more than doubled its first-quarter profit by setting aside less money for loan losses.

— Coach fell 3 percent after the maker of high-end leather goods said results in U.S. department stores were weak, despite stronger sales in China.

— Netflix plunged 12 percent after saying it is adding new subscribers slowly in the second quarter. Investors are nervous about stronger competition from video-streaming rivals such as Amazon.com and Comcast.

A wave of weak U.S. economic data failed to douse the rally for stocks. Sales of new homes fell by 7 percent last month, the biggest decline in a year, the government said after markets opened. Home prices in most major U.S. cities fell in February for a sixth straight month.

Americans' confidence in the economy held steady despite rising gas prices and falling home values, according to the Conference Board, a private research group.

About three stocks rose for every one that fell on the New York Stock Exchange.


Daniel Wagner can be reached at www.twitter.com/wagnerreports.