NEW YORK — Wall Street fluctuated today after another drop in oil prices blunted reaction to a mixed set of earnings reports.

Investors believe the drop in oil, if it lasts, will boost the slumping economy. Crude has retreated nearly $5 a barrel in the past two sessions as Hurricane Dolly looked likely to spare key oil installations in the Gulf of Mexico; it's down more than $20 since hitting a record above $147 just weeks ago.

A barrel of light, sweet crude fell $1.86 to $126.56 on the New York Mercantile Exchange.

A drop in energy prices would benefit a wide spectrum of companies, including airlines, manufacturers and even retailers. It also helped distract investors from some disappointing earnings delivered this week — especially from struggling banks and brokerages.

Investors sifted through a raft of earnings news on Wednesday, including a profit warning from warehouse retailer Costco Wholesale Corp. Dow Jones industrial average components McDonald's Corp., Pfizer Inc. and AT&T Inc. all posted results.

In the first hour of trading, the Dow rose 17.42, or 0.15 percent, to 11,619.92. On Tuesday, it rose 135 points.

Broader stock indicators advanced. The Standard & Poor's 500 index rose 6.58, or 0.52 percent, to 1,283.58 and the Nasdaq composite index rose 19.96, or 0.87 percent, to 2,323.92.

Bond prices declined as investors moved some money into equities. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 4.13 percent from 4.10 percent from late Tuesday.

The dollar was higher against other major currencies, while gold prices fell.

McDonald's credited strong overseas sales with driving the company's second-quarter profit. The nation's largest restaurant chain easily surpassed Wall Street's expectations. The stock fell 26 cents to $59.86.

AT&T rose 53 cents to $35.35 after the company said quarterly profits rose amid a big spike in wireless subscribers that offset its shrinking landline business. The biggest U.S. phone company is the official carrier of Apple Inc.'s iPhone, and that helped add 1.3 million wireless subscribers during the period.

Pfizer, the world's biggest drugmaker, said its second-quarter earnings more than doubled as restructuring charges declined and the weak dollar helped lift overseas revenue. It narrowly beat Wall Street expectations. The stock rose 30 cents to $18.65.

Boeing Co. fell $2.78, or 4 percent, to $66.48 after reporting that second-quarter earnings fell 19 percent because a $248 million charge related to a defense program. The world's second-largest commercial airplane maker had already warned it would book the expense.

Washington Mutual Inc. rose 18 cents, or 3.1 percent, to $6 after the nation's largest thrift reported a $3 billion loss due to increases in its loss reserves to cover souring loans in its mortgage portfolio.

Costco warned that its fiscal fourth-quarter and full-year profits will fall short of Wall Street's expectations. The warehouse club operator expects higher energy costs to hurt its results. The stock fell $7.98, or 11 percent, to $64.02.

Fannie Mae and Freddie Mac advanced as the House planned to vote Wednesday on legislation that would tap the mortgage giants' profits to cover any losses from saving 400,000 homeowners from foreclosure. The measure would give the Treasury Department authority to extend the companies a temporary lifeline. Fannie Mae rose $2.05, or 15.3 percent, to $15.46, while Freddie Mace rose 99 cents, or 10 percent, to $10.69.

In economic news, the Federal Reserve is expected to release its Beige Book, an analysis of regional economic conditions, at 2 p.m. EDT.

Advancing issues outnumbered decliners by about 4 to 3 on the New York Stock Exchange, where volume came to 225.3 million shares.

The Russell 2000 index of smaller companies rose 4.67, or 0.65 percent, to 721.49.

Overseas, Japan's Nikkei stock average rose 0.97 percent. In afternoon trading, Britain's FTSE 100 added 1.11 percent, Germany's DAX index rose 0.88 percent, and France's CAC-40 rose 1.31 percent.