Wall Street rebounds on profits; IBM, Coke lead
Stocks jumped about 1 percent on Tuesday on strong earnings from IBM and Coca-Cola, offsetting investor disappointment in results from big financial firms.
The turnaround from Monday's losses over debt concerns also received a boost from unexpectedly strong housing data.
Dow component International Business Machines Corp
The S&P information technology sector <.GSPT> gained 1.8 percent, the top gainer among S&P sectors. Shares of Apple
The market is focused once again on corporate earnings, taking over for the debt talks, said Rob McIver, co-portfolio manager of the Jensen Portfolio in Portland, Oregon.
The market has been preoccupied with wrangling in Washington over a deal to raise the debt ceiling. There is a growing sense that a last-ditch plan taking shape in Congress may be the only way to avoid a U.S. default.
However, all 10 S&P 500 sectors rose on Tuesday, even financials, which were hit by declines in Goldman Sachs Group Inc
Goldman is a bellwether of the rest of the banks, and it should set the tone for the rest of them, but I wouldn't be too pessimistic, said Robert Francello, head of equity trading for Apex in San Francisco.
Those losses were offset by a 4 percent rise in shares of Wells Fargo
The Dow Jones industrial average <.DJI> was up 121.40 points, or 0.98 percent, at 12,506.56. The Standard & Poor's 500 Index <.SPX> was up 12.80 points, or 0.98 percent, at 1,318.24. The Nasdaq Composite Index <.IXIC> was up 44.45 points, or 1.61 percent, at 2,809.56.
Housing starts topped forecasts in June to touch a six-month high, and permits for future construction unexpectedly increased, the government reported. Homebuilder D.R. Horton Inc
Goldman's second-quarter net income fell short of lowered expectations as fixed income trading revenue dropped sharply. Bank of America recorded a second-quarter net loss of $8.8 billion after a big settlement with mortgage bond investors.
Coca-Cola Co
Coke rose 3 percent to $69.12, while J&J was 0.7 percent lower at $66.63. Both stocks are Dow components.
(Additional reporting by Caroline Valetkevitch and Ryan Vlastelica; Editing by Kenneth Barry)
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