Stocks push higher
Wall Street musters gains as investors welcome a better-than-expected corporate report from Goldman Sachs, but advance is limited.
NEW YORK (CNNMoney.com) -- Stocks gained Tuesday after a choppy session in which investors welcomed Goldman Sachs' better-than-expected results but showed caution ahead of all the quarterly reports due in the weeks ahead.
After the close, Intel (INTC, Fortune 500) reported earnings and revenue that fell from a year ago but topped estimates. The chipmaker also said that third-quarter revenue will top expectations. Shares popped 7% in after-hours trading.
The Dow Jones industrial average (INDU) gained 28 points, or 0.3%. The S&P 500 (SPX) index added 5 points, or 0.5%. The Nasdaq composite (COMP) edged up 6 points, or 0.4%.
Stocks rallied Monday after influential banking analyst Meredith Whitney said she was raising her view on Goldman Sachs (GS, Fortune 500). On Tuesday, Goldman reported a bigger-than-expected quarterly profit, setting the stage for a week of reports from the financial sector.
However, Goldman's report failed to do much for markets Tuesday. "Yesterday marked a big turnaround in sentiment regarding the financials and the stocks rallied," said Kenny Landgraf, founder and principal at Kenjol Capital Management. "So today you're seeing less of a reaction."
JPMorgan Chase (JPM, Fortune 500) reports Thursday and Bank of America (BAC, Fortune 500) and Citigroup (C, Fortune 500) report Friday. The sector as a whole is expected to see profits fall more than 50% versus a year ago, according to Thomson Reuters.
S&P 500 earnings are expected to have declined around 36% in the quarter, versus a year ago. However, what the corporations say about the second half of the year and the economic outlook will be critical.
After rallying 40% in three months, stocks have drifted lower over the last month. The second-quarter reporting period could provide the next catalyst for a move in either direction.
"Caution about earnings was reflected by the pullback over the last few weeks," said Gary Flam, portfolio manager at Bel Air Investment Advisors. "But as we move through earnings season and the results are for the most part in line or better than expected, investors will move back into stocks."
He said that toward the end of the third quarter, stocks are likely to see another decline, but ultimately finish the year 5% to 7% higher than where they are now.
Economic news will be in focus Wednesday. Reports are due in the morning on consumer inflation, manufacturing, oil inventories and industrial production and capacity utilization. In the afternoon, the minutes from the last Federal Reserve policy meeting are due.
Goldman Sachs: The financial leader said it earned $3.44 billion, or $4.93 per share, in the second quarter versus $2.1 billion, or $4.58 per share, a year ago.
Analysts surveyed by Thomson Reuters expected net income of $1.73 billion or $3.54 a share.
Goldman, considered to be the healthiest of Wall Street banks during the downturn, benefited from strength in its fixed-income and trading businesses.
In other financial sector news, small-business lender CIT Group (CIT, Fortune 500) rallied Tuesday on bets that the strapped company will get government help.
Other company news: Dow component Johnson & Johnson (JNJ, Fortune 500) reported second-quarter earnings of $1.15 per share versus $1.18 a year ago. Analysts were expecting $1.11 per share, on average. J&J shares inched higher.
Dell (DELL, Fortune 500) shares slipped 8% after the company said late Monday that it expects to see a small decline in gross margins, a key measure of profitability. Dell also said it expects to report a slight increase in revenue when its second quarter ends at the end of July.
Market breadth was positive. On the New York Stock Exchange, winners beat losers seven to three on volume of 980 million shares. On the Nasdaq, advancers topped decliners five to four on volume of 1.89 billion shares.
Economy: Higher gas prices and increases in auto purchases and auto prices boosted June retail sales and wholesale inflation, the government reported.
June retail sales rose 0.6%. the Commerce Department reported. Economists surveyed by Briefing.com thought sales would rise 0.4%. Sales rose 0.5% in the previous month.
Sales excluding autos rose 0.3%, short of forecasts for a rise of 0.5%. Sales rose 0.5% in May.
The producer price index (PPI), a measure of wholesale inflation, jumped 1.8% in June versus forecasts for a rise of 1%. Higher gas prices played a big role in the rise. PPI rose 0.2% in the previous month.
The so-called core PPI, which strips out volatile food and energy prices, rose 0.5% after falling 0.1% in May. Economists thought it would rise 0.1%.
Bonds: Treasury prices fell, raising the yield on the benchmark 10-year note to 3.46% from 3.35% Monday. Treasury prices and yields move in opposite directions.
Other markets: In global trade, Asian and European markets ended higher.
In currency trading, the dollar gained against the euro and the Japanese yen.
U.S. light crude oil for August delivery fell 17 cents to settle at $59.52 a barrel on the New York Mercantile Exchange.
COMEX gold for August delivery rose 30 cents to settle at $922.80 an ounce. 
