Stocks close higher on boost from Boeing, tech
Wall Street rises at the end of mixed day as investors welcome stronger-than-expected earnings.
NEW YORK (CNNMoney.com) -- Stocks closed higher Wednesday as investors began to embrace first-quarter earnings reports, cheering Boeing's better-than-expected results and anticipating more good news from the tech sector.
The Dow Jones industrial average (INDU) rose 43 points, or 0.3%. The broader Standard & Poor's 500 (SPX) gained 0.3%. The tech-laden Nasdaq composite (COMP) rose 1.2%.
"People are really focused on the earnings season so far and that seems to be what's been driving the market's back and forth moves," said Barrett Capital Management Chief Information Officer Russell Lundeberg, Jr.
"Overall the sentiment is probably that people have priced in a little too much pessimism, as things are turning out not to be as bad as people feared," he added.
After the bell and before Thursday's opening bell, 213 companies were set to report their earnings.
Leading the pack was computer and consumer electronics maker Apple (AAPL, Fortune 500), which reported profit and sales that beat Wall Street estimates, but offered guidance that disappointed investors. The tech's stock fell in after-hours trading.
Similarly, Internet retailer Amazon.com (AMZN, Fortune 500) posted impressive earnings but lowered its full-year guidance, sending its stock lower after the bell.
And telecom company Qualcomm (QCOM, Fortune 500) impressed investors with its profit and revenue. But even though it raised its guidance for the current quarter, shares were trading down in after-hours trading.
"Investors are still waiting to get a solid feel for what the fundamentals of the market are," said Lundeberg. "It's important for people to realize what happened within the various sectors in the first quarter, and if there is any spillover from credit markets."
Traders will also get a look at durable goods orders and initial jobless claims figures before the bell Thursday.
Earnings news. Dow component Boeing (BA, Fortune 500) said profit rose 38% in the first quarter to $1.2 billion. Additionally, the company said its backlog of orders grew to a record of $346 billion. Boeing's stock rose over 3.5%, making up two-thirds of the Dow's gains Wednesday.
Meanwhile, UPS reported a 7.5% increase in first-quarter profit but warned that it expects the U.S. economy to remain weak during the second quarter.
Shares of Ambac Financial Group (ABK) fell nearly 43% after the bond insurer reported a $1.66 billion first-quarter loss on hefty charges related to mortgage-backed bonds. The company also said it has stopped underwriting insurance on some debt.
Drugmaker Schering-Plough (SGP, Fortune 500) said first-quarter earnings rose about 6%. The company's results were hindered by a $23 million charge related to an acquisition and $688 million in accounting adjustments.
Technology stocks. Yahoo reported stronger-than-expected first-quarter earnings after the closing bell Tuesday.
Despite the upbeat earnings, Yahoo (YHOO, Fortune 500) shares fell nearly 2% as investors await the company's response to Microsoft's (MSFT, Fortune 500) unsolicited buyout offer. Yahoo has until Saturday to accept Microsoft's bid or face a proxy fight.
However, Bloomberg reported Wednesday afternoon that Microsoft CEO Steve Ballmer does not plan to raise his $46 billion offer for Yahoo.
Investors view the technology sector favorably since it is more "outward facing," said Art Hogan, chief market analyst at Jefferies & Co. Given the difficulties facing the U.S. economy, companies with access to overseas markets have a huge advantage.
"Technology companies are on the leading edge of being able to garner revenue from overseas," Hogan said.
Auto sales. Toyota has taken the global sales leader title from General Motors (GM, Fortune 500) for the first quarter.
Toyota (TM) said sales increased 2.7% to 2.41 million vehicles in the first quarter. Meanwhile, GM's sales decreased less than 1% to 2.25 million in the same time frame.
Despite the news, shares of GM rose more than 2% Wednesday.
Airline woes. Record high fuel prices have battered the airline industry and resulted in steep quarterly losses for some carriers Wednesday.
Delta Airlines (DAL, Fortune 500) said soaring fuel prices eroded its market value and led to a staggering $6.4 billion loss in the first quarter. The airline said the loss is equivalent to $16.15 a share and was due largely to a non-cash charge of $6.1 billion.
At the same time, Northwest Airlines (NWA, Fortune 500) reported a $4.14 billion first-quarter loss, or $15.78 per share, mostly because of $3.9 billion charge related to rising fuel prices and the company's declining share price.
Last week, Northwest agreed to combine with Delta to create the world's largest carrier.
Both airlines said sales in the first quarter rose.
Deal news. Privately held insurance company Liberty Mutual has offered about $ 6.2 billion to buy Safeco Corp.
The deal, which represents a 51% premium to Safeco's closing price on Tuesday, would create the country's fifth-largest property and casualty insurer. (full story)
Safeco's (SAF, Fortune 500) stock rose nearly 46% on the news.
Market breadth was fairly even. On the New York Stock Exchange, gainers slightly edged out losers on volume of 1.2 billion shares. On the Nasdaq, advancers just topped decliners on volume of 2 billion shares.
Commodities. U.S. light crude oil for June delivery rose 23 cents to settle at $118.30 a barrel in New York after a government report showed a larger than expected drop in gasoline supplies and a more than expected gain in crude inventories.
On Tuesday, oil hit an all-time trading high of $119.90 a barrel.
The national average price for a gallon of regular unleaded gas hit an all-time record of $3.53, AAA reported.
COMEX gold for June delivery fell $16.20 to settle at $909 an ounce.
Other markets. Treasurys fell Wednesday ahead of the Federal Reserve's record $30 billion auction of 2-year debt. The yield on the benchmark 10-year note rose to 3.73%, up from 3.69% late Tuesday. Bond prices and yields move in opposite directions.
The dollar rose modestly against the euro and yen after hitting an all time low against the 15-nation euro in the previous session. 
