Muscular US corporate earnings and higher spirits in Europe propelled Wall Street stocks higher yesterday. Five of the 30 big companies that make up the Dow Jones industrial average rose more than 1.5 per cent. AT&T led the gains after reporting better-than-expected profit. Verizon, AT&T's main rival, was close behind. 3M rose sharply after delivering an impressive quarterly report. GE and DuPont rounded out the list of top gainers.
The Dow closed up 74.39 points, or 0.6 per cent, at 13,001.56. IBM rose solidly after the company said it is raising its quarterly dividend and plans to repurchase US$7 billion more of its stock. The S&P 500 rose 5.03 points, or 0.4 per cent, to 1,371.97. The Nasdaq composite average fell 8.85 points to 2,961.60. Apple is the Nasdaq's biggest component and the biggest company by market value.
European stocks rallied into the close a day after one of their worst drops in months. Monday's sell-off followed fears that deficit-cutting deals by some European nations might unravel. Yesterday, as Monday's panicked atmosphere lifted, interest rates on Spanish bonds already in circulation declined. France's CAC-40 index closed up 2.3 per cent. Germany's DAX rose one per cent, London's FTSE 100 0.8 per cent.
As stocks rose, traders sold ultra-safe Treasurys. The yield on the 10-year Treasury note rose to 1.97 per cent from 1.94 per cent late Monday.
