New York: Mixed earnings reports and a stronger dollar helped US stocks finish about where they started Tuesday.
The Dow Jones industrial average wavered within a 100-point range as traders attempted to parse the direction of the economy amid a drop in home prices, a batch of weak earnings reports and a slight rise in consumer confidence.
Stocks started the day with losses after disappointing results from Texas Instruments Inc., US Steel Corp., Bristol-Myers Squibb Co. Du Pont, one of the 30 companies that make up the Dow average, fell 1% even though it beat estimates. Investors have been having high expectations this season with three out of every four companies besting analyst estimates.
The Dow Jones industrial average rose 5.41 points, or 0.1%, to 11,169.46. The Standard & Poor’s 500 index rose 0.02% to 1,185.64, while the technology-focused Nasdaq composite index rose 6.44 points, or 0.3%, to 2,497.29.
The 30 stocks in the Dow were split down the middle, with half falling and half rising. Microsoft Corp. rose 2.8% to lead the index, while Procter & Gamble fell 1.1% as the measure’s laggard.
A gain in consumer confidence this month helped stocks pare their losses and then edge higher in afternoon trading.
“The consumer confidence numbers were encouraging,” said Bernie McSherry, vice president of strategic initiatives at Cuttone and Co. It’s a sign shoppers “may be reaching into their wallets heading into the holiday shopping season.”
Ford Motor reported a record third quarter profit on Tuesday, citing a strong product line and better sales in North America. It gained 1.4% in US market share, while GM lost some. For the year, Ford also beat out Toyota in US sales.
Ford was able to avoid bankruptcy and government bailout money unlike GM and Chrysler early last year, but it left the company with a lot more debt than the other 2 automakers. Ford’s previous best net-quarter was in 1997.
Shares of Netflix Inc. rose $10.78, or 6.4%, to $177.62 amid rumors that the company may be a target of an acquisition by Apple Inc.
Traders were moving out of riskier assets as the dollar strengthened. A stronger dollar makes stocks and commodities more expensive because they are priced in dollars. The dollar rose against Japan’s yen and the euro Tuesday.
Home prices slid in August, renewing concerns about the health of the housing market. Fifteen of the 20 cities measured in the Standard & Poor’s/Case-Shiller home price index saw price declines.
Consumer confidence, a measure used to gauge consumer spending, rose slightly in October to 50.2. High unemployment and bad business conditions have brought the index down to far below 90, which indicates a stable economy.
A reading above 100 indicates a strong economy, a level last reached in mid 2007.
Bond prices fell slightly. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 2.64% from 2.56% late Monday.
Trading volume on the floor of the New York Stock Exchange came to 965 billion shares.