Wall Street moves higher, but housing data caps gains
Stocks rose on Monday, boosted by solid earnings from Halliburton and a strong order outlook from Boeing, but gains were capped by a drop in homebuilder sentiment and some disappointing corporate revenues.
Halliburton Co kicked off a busy earnings week, posting a better-than-expected rise in profits, and its shares rose 5.7 percent to $29.10.
But both Hasbro Inc and Delta Air Lines Inc posted revenue that fell short of expectations, underscoring views of a sketchy economic recovery.
A decline in homebuilder sentiment to its lowest level in more than a year exacerbated the negative tone, following a more than 2.5 percent drop in major indexes on Friday.
There's a lot of indecision about the overall economy's direction and moves like Friday's only reinforce the negative view of the second half of the year, as opposed to make people feel these (declines) are buying opportunities, said Michael James, senior trader at Wedbush Morgan in Los Angeles.
The Dow Jones industrial average <.DJI> gained 44.65 points, or 0.44 percent, to 10,142.55. The Standard & Poor's 500 Index <.SPX> rose 4.41 points, or 0.41 percent, to 1,069.29. The Nasdaq Composite Index <.IXIC> added 11.90 points, or 0.55 percent, to 2,190.95.
The S&P 500 hit a low of about 1,061 on Monday, even with the index's 14-day moving average and the 23.6 percent retracement of the benchmark's 2010 high-to-low decline, suggesting a level of resistance where pockets of buying would be expected.
Boeing Co , up 1.6 percent to $62.83, was the top boost to the Dow industrials after it announced an order for 30 large airliners from Dubai-based Emirates and expects to announce more orders this week, particularly from airplane leasing companies.
Entergy Corp forecast second-quarter profit above market estimates and backed its full-year earnings outlook. Its shares rose 2 percent to $77.47.
But Hovnanian Enterprises dropped 4.7 percent to $3.84 after the National Association of Home Builders/Wells Fargo Housing Market index fell to its lowest since April 2009.
Delta Air Lines Inc , the world's biggest air carrier, posted a better-than-expected quarterly profit, but revenue missed expectations and its shares fell as much as 11.3 percent before rebounding. Delta stock lost 0.5 percent to $11.65 and an index of airline stocks <.XAL> dropped 0.9 percent.
Hasbro Inc fell 0.8 percent to $39.19 after it posted a sharper-than-expected quarterly sales decline from a year ago.
International Business Machines Corp was up 1.4 percent to $129.84, trading near its 14, 50 and 200-day moving averages ahead of its earnings report after the bell.
Texas Instruments Inc , which also reports later Monday, rose 2.7 percent to $25.44.
There's potential for positives from Texas Instruments, IBM, Apple, that all could change sentiment, but I don't think there's too many people willing to go out on a limb to make a bet on that, James said.
Second-quarter earnings for S&P 500 companies are expected to increase 30.2 percent from a year ago, up from an estimate of 27 percent a little more than a week ago, according to Thomson Reuters' data. The percentage combines both estimated earnings and actual results.
(Editing by Padraic Cassidy)
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