US stocks rise
Tuesday, October 23rd, 2007Better-than-expected earnings from Apple Inc. and American Express Co. took away some of the ongoing concern about the unstable US housing market. Apples’ record sales of Macintosh computers and increasing demand of Iphones and Ipods pushed its stock to the highest level since January. Technology stocks rallied after Research In Motion Ltd’s announcement that they will distribute Blackberry email phones to China together with Alcatel-Lucent.
Research In Motion Ltd.’s alliance with Alcatel-Lucent to distribute the BlackBerry e-mail phone in China helped spur a late-day rally in technology stocks that pushed the Nasdaq Composite Index up 45.33, or 1.7 percent, to 2,799.26. The Standard & Poor’s 500 Index added 13.26, or 0.9 percent, to 1,519.59. The Dow Jones Industrial Average gained 109.26, or 0.8 percent, to 13,676.23.
“If companies are still beating expectations, that’s a good backdrop for stocks,” said Robert Morgan, who helps manage about $10.5 billion at Janney Montgomery Scott LLC in Philadelphia. “It says good things about the health of the U.S. economy.”
Today’s earnings reports helped alleviate concern that the worst housing slowdown in 16 years would cause profits to drop for the first time since 2002. The 170 members of the S&P 500 that reported results as of the close of U.S. exchanges posted an average earnings gain of 4 percent, according to Bloomberg data, topping a 0.6 percent decline forecast by analysts on Oct. 19. Sixty-six percent of them beat analysts’ profit estimates.