Posted on: Wednesday, January 26, 2005
Corporate earnings give stocks a boost
By Michael J. Martinez
Associated Press
NEW YORK — A raft of strong earnings reports buoyed investors' lagging confidence and sent stocks sharply higher yesterday, with the Dow Jones industrial average turning in its best showing of the year.
"I'm not sure there's any one particular thing we can point to here. We're getting deep into earnings season, and these companies are showing growth in bottom line results," said Joseph Battipaglia, chief investment officer at Ryan Beck & Co. "We've had a one-third correction from the November and December rally, and investors are coming back in now to buy on the dip."
However, the market's gains were somewhat deceptive. Declining issues outnumbered advancers by a slim margin on the New York Stock Exchange — a sign that investors are picking stocks very carefully.
The earnings reports helped investors overcome ongoing fears about the upcoming Iraqi elections and oil prices that continued to climb toward $50 per barrel.
A strong consumer confidence reading also helped boost stocks. The Conference Board's consumer confidence index for January came in at 103.4, up from December's reading of 102.7 and better than the 101.3 expected.
Consolidated volume on the New York Stock Exchange came to 2.07 billion shares, compared with 1.91 billion on Monday.
Wall Street bellwether Merrill Lynch & Co. Inc. posted a record year, while U.S. Steel Corp. swung to a profit. And despite slumping profits at drug makers Johnson & Johnson and Merck & Co., their earnings met or surpassed analysts' forecasts.
