Stocks Bounce Back on Earnings Report
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The Dow rose 78 points to close at 12,805 on Tuesday.
The market has been taking a beating in July because of worries that Spain's banking system would fail and that U.S. corporate earnings would shrink.
Mattel (MAT ) stock jumped 10%, more than any other company in the S&P 500. The country's biggest toy maker said net income rose because of better sales of Barbie dolls and lower advertising costs.
Coca-Cola (KO) rose 1% after it posted higher income and revenue.
In other trading, the Standard & Poor's 500 index gained 10 points to 1,364, and the Nasdaq rose 13 points to 2,910.
Two stocks rose for every one that fell on the New York Stock Exchange. Trading volume was below average at 3.4 billion.
A grim assessment on the U.S. economy from Federal Reserve Chairman Ben Bernanke kept the gains in check. He said weaker economic growth likely means the unemployment rate will be slow to drop. But he offered no signs that the Fed was ready to take action to bolster growth soon.
"The big question here isn't whether the Fed will act," said Randy Frederick, managing director of active trading and derivatives at Charles Schwab. "We know they will. The question is how bad do things have to deteriorate before they act."
Goldman Sachs (GS) also reported earnings and revenue that beat Wall Street's forecasts. The bank said it bundled more mortgages into bonds, leading to a 37% increase in sales from mortgage and commodity trading. Its stock gained 30 cents to $97.98.
Among other stocks making big moves:
-- Mosaic (MOS) jumped 5%. The fertilizer maker's net income beat Wall Street's forecasts, with the help of stronger phosphate sales and higher prices for potash. Mosaic also doubled its quarterly dividend to 25 cents. The stock gained $2.84 to $58.21.
-- Reports that HSBC(HBC) allowed Mexican drug cartels to launder billions through its U.S. banks helped push the bank's stock down 1%. A Senate investigation also said some HSBC bank affiliates ignored U.S. government bans against financial transactions with Iran and other countries. HSBC fell 20 cents to $43.28.
-- Walt Disney (DIS) led the Dow, gaining $1.49 to $49.35 after getting an upgrade by analysts at Bank of America.
Source: The AP
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