Stocks bounce back

NEW YORK (CNNMoney.com) -- Upbeat earnings from Goldman Sachs and Best Buy boosted stocks Tuesday morning, distracting investors from rising oil prices and the latest woes for the housing sector.

The Dow Jones industrial average (INDU) added 0.5 percent in the early going. The broader S&P 500 (INX) index added 0.6 percent. The tech-fueled Nasdaq (COMPX) composite gained 0.6 percent.

Stocks had slumped Monday and the previous week on worries about the economic outlook amid rising inflationary pressures and slower growth prospects.

Also helping in the early going: news that the European Central Bank (ECB) has made available unlimited funds at a set rate for the next two weeks, in a move to help with liquidity demands through the end of the year. The move follows an announcement last week that the ECB, the U.S. Federal Reserve and other banks have teamed up to make billions available for banks seeking loans.

In earnings news, Goldman Sachs (GS, Fortune 500) reported higher quarterly sales and earnings that topped estimates, managing to deliver despite the current credit market crisis. Nonetheless, shares inched lower, as investors took a 'sell the news' reaction.

Best Buy (BBY, Fortune 500) reported higher quarterly sales and earnings that topped forecasts, thanks to extra shopping days in November and more store openings. However, the electronics retailer cautioned that December and fourth-quarter sales will be constrained. Shares slipped over 1 percent in the early going.

In economic news, housing construction and builder permits dropped in November, in a continued sign of erosion for the market, although the decline was smaller than what economists had forecast. (Full story)

Treasury prices were little changed, with the yield on the 10-year note at 4.14 percent, roughly where it stood late Monday. Treasury prices and yields move in opposite directions.

In currency trading, the dollar gained versus the euro and slipped against the yen.

U.S. light crude oil for January delivery rose $1.57 to $92.20 a barrel on the New York Mercantile Exchange.

COMEX gold for February delivery rose $10.70 to $810 an ounce.