Stocks moved sharply higher Wednesday on strong earnings from Time Warner, declining oil prices and a big upswing in tech stocks. The Dow Jones industrial...
NEW YORK — Stocks moved sharply higher Wednesday on strong earnings from Time Warner, declining oil prices and a big upswing in tech stocks.
The Dow Jones industrial average rose 65.96 to 10,472.73.
Microsoft, one of the 30 Dow stocks, gained 50 cents to close at $26.46 a share. Boeing, also a Dow stock, fell 35 cents to $64.70.
Broader stock indicators also advanced. The Standard & Poor’s 500 index rose 12.00 to 1,214.76. The Nasdaq composite index, boosted by tech leaders including Apple Computer, rose 30.26 to 2,144.31.
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With three-quarters of third-quarter earnings reported, the S&P 500 is poised to post a 14 percent year-over-year quarterly gain. Traders continue to watch earnings while they wait for details on the economic outlook from the Federal Reserve, which raised its benchmark interest rate to 4 percent Tuesday, its 12th consecutive rate increase.
“Interest rates are still rising, but for the moment, we have great corporate profits,” said Charles Blood Jr., senior financial-markets analyst at Brown Brothers Harriman. “It’s like a race between interest rates and profits. One day interest rates seem to win, the next day profits seem to win.”
The result is a market where large-cap stocks are nearly flat for the year.
Oil futures fell. A barrel of light crude was quoted at $59.75, down 10 cents, in trading on the New York Mercantile Exchange. Oil’s decline widened after the Energy Information Administration reported oil and gas reserves that were in line with analysts’ exceptions.
Despite the day’s gains, money managers remain wary of stocks. The S&P 500 is barely positive for the year. Merrill Lynch said in a strategy note that its “sell-side indicator,” a survey of Wall Street strategists’ recommended asset allocations, shows the number of strategists who are moving more money into cash rose last month.
“Cash still appears to be the only asset class with a near-certain increasing and competitive expected return,” Merrill Lynch said in the note.
Near the top of investors’ list of worries is how long the Federal Reserve will continue to raise interest rates.
“It’s been a little difficult to get any read as to what their thinking may be,” said Jim Dunigan, chief investment officer for PNC Advisors.
Time Warner reported an 80 percent rise in third-quarter earnings. Stock in the company, whose properties include the Warner Bros. studio, HBO, CNN and Time magazine, rose 33 cents to $17.90.
Apple rose $2.45 to $59.95 as investors bet it will do well in its recent video iPod business and continue to succeed in the digital-music arena.