Stocks gain ahead of second quarter corporate earnings kickoff
Monday, July 8, 2013
NEW YORK (AP) — Cautious optimism over corporate earnings sent the stock market higher Monday.
U.S. companies start reporting their second-quarter results this week, led by aluminum producer Alcoa, the first company in the Dow Jones industrial average to announce results. Other major companies reporting include JPMorgan and Wells Fargo.
Analysts predict that earnings growth for companies in the Standard & Poor’s 500 index rose 3 percent in the second quarter.
While growth is down from 5 percent in the first quarter, earnings are still expected to reach record levels.
Investors and traders will search for evidence that companies are increasing revenues, not just cutting costs to boost profits.
Sales growth is predicted to fall 0.3 percent in the second quarter.
The Dow rose 88.85 points, or 0.6 percent, to close at 15,224.69. The Standard & Poor’s 500 index gained 8.57 points, or 0.5 percent, to end at 1,640.46.
Dell was among the big gainers in the S&P 500 index. An advisory firm recommended that company shareholders support a plan to take the computer company private. Founder Michael Dell and Silver Lake Partners have offered to buy Dell for $24.4 billion, or $13.65 a share. Dell rose 41 cents, or 3.1 percent, to $13.44.
The Russell 2000 index, an index of small-company stocks, closed at an all-time high 1,009.25. The index past the 1,000 mark for the first time Friday and has gained 18.8 percent this year, a sign that investors are more willing to take on risk.
In other trading, the Nasdaq composite rose 5.45, or 0.2 percent, to 3,484.83, the smallest gain of the major indexes.
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