Stocks gain again as oil keeps falling
NEW YORK » Stocks advanced for the second straight session yesterday as another decline in oil prices and several upbeat profit reports eased some of Wall Street's concerns about the economy.
Investors expect that a sustained pullback in oil prices would give a crucial boost to the economy. Crude has retreated as oil investors have worried that high prices and a sluggish economy are reducing demand. The government reported yesterday that domestic inventories increased last week as consumers curbed their energy use.
Oil is down more than $20 a barrel since hitting a record above $147 just weeks ago. A barrel of light, sweet crude fell $3.98 to settle at $124.44 a barrel on the New York Mercantile Exchange.
While oil again tugged at stocks, as it has for months, investors also examined a raft of earnings reports that indicated not all corporate profits were suffering because of the slower economy. That left some investors more upbeat about the prospects for the overall economy. AT&T Inc., McDonald's Corp. and Pfizer Inc., all among the 30 stocks that make up the Dow Jones industrial average, weighed in with reports that generally pleased investors.
"Oil is a positive but I think bigger than that is the earnings news is not as catastrophic as people were thinking," said Noman Ali, portfolio manager of U.S. equities for MFC Global Investment Management in Toronto.
AT&T rose $1.24, or 3.9 percent, to $33.06 after the company said quarterly profits rose amid a big spike in wireless subscribers that offset its shrinking landline business.
Pfizer, the world's biggest drug maker, said its second-quarter earnings more than doubled as restructuring charges declined and the weak dollar helped lift overseas revenue. The stock rose 72 cents, or 3.9 percent, to $19.07.
McDonald's credited strong overseas sales with driving the company's second-quarter profit. The stock fell 46 cents to $59.66.
The Dow rose 29.88, or 0.26 percent, to 11,632.38 after rising nearly 100 points early in the session. On Tuesday, the blue chips gained 135 points.
The Standard & Poor's 500 index rose 5.19, or 0.41 percent, to 1,282.19 and the Nasdaq composite index rose 21.92, or 0.95 percent, to 2,325.88.
Nasdaq's gains came ahead of a report from Amazon.com Inc., which said after the closing bell that its second-quarter profit more than doubled to top Wall Street's expectations.
Advancing issues outnumbered decliners by about 5 to 3 on the New York Stock Exchange, where volume came to 1.72 billion shares, compared with 1.57 billion shares traded Tuesday.
The Russell 2000 index of smaller companies rose 2.37, or 0.33 percent, to 719.19.
The yield on the benchmark 10-year Treasury note rose to 4.12 percent from 4.10 percent from late Tuesday.