Nov. 10 (Bloomberg) -- Most U.S. stocks fell following six straight gains for the Standard & Poor’s 500 Index as earnings disappointed investors at companies from MBIA Inc. and Fluor Corp. to Electronic Arts Inc.

MBIA, the world’s largest bond guarantor, tumbled 27 percent after posting a $727.8 million loss on insured credit derivatives. Fluor sank 7.6 percent as the engineering firm cut its full-year profit forecast, while Electronic Arts sank 6.4 percent following its 11th straight quarterly loss. The Dow Jones Industrial Average climbed to a 13-month high for a second day as American Express Co. and Bank of America Corp. rallied.

“The market seems to go back and forth daily based on who reports earnings and what they report, and today you had a couple of modestly disappointing earnings repots,” said Dean Gulis, part of a group that manages $2.5 billion for Loomis Sayles & Co. in Bloomfield Hills, Michigan. “To some extent you’re having a reaction to a pretty strong day yesterday.”

Eight stocks dropped for every five that rose on the New York Stock Exchange. The S&P 500 slipped less than 0.1 percent to 1,093.01 at 4:06 p.m. in New York after rallying 2.2 percent yesterday. The Dow increased 20.03 points, or 0.2 percent, to 10,246.97 for its highest close since Oct. 3, 2008.

The S&P 500 climbed as much as 0.3 percent in the first hour of trading today, bringing the gauge within 1.5 points of its one-year high on Oct. 19. The index hasn’t advanced for seven straight days since 2006. The S&P 500 is down 30 percent from its 2007 peak even after rebounding 62 percent from a 12- year low in March.

‘Gradual Improvements’

“To get further rallies from here, we’ll have to see continuation of gradual improvements with respect to growth, business activity and hopefully a continuing slowdown in the pace of layoffs,” said Christopher Sullivan, who oversees $1.4 billion as chief investment officer at United Nations Federal Credit Union in New York.

Of 430 companies in the S&P 500 that reported quarterly earnings since Oct. 7, 83 percent exceeded estimates, according to data compiled by Bloomberg. Average earnings per share slumped 15 percent in the period, a ninth-straight quarter of declining profits. Retailers Macy’s Inc., Wal-Mart Stores Inc. and J.C. Penney Co. are among companies scheduled to release results this week.

MBIA, Fluor

MBIA slid 27 percent to $3.52, its steepest loss since April 2008. The insurer reported a net loss of $727.8 million, or $3.50 a share, in the third quarter on a drop in the value of securities the company backs through the credit derivatives market. The average estimate of three analysts surveyed by Bloomberg was for a loss of $1.09 a share.

Fluor declined 7.6 percent to $44.38 for its biggest tumble since March. The largest publicly traded U.S. engineering firm lowered its full-year earnings forecast after posting third- quarter profit of 89 cents a share. Analysts surveyed by Bloomberg estimated earnings of 90 cents on average.

Electronic Arts lost 6.4 percent to $18.29. The second- largest video-game publisher reported its second-quarter loss widened to $391 million, or $1.21 a share. Excluding some items, per-share profit of 6 cents missed the 10-cent average estimate of analysts in a survey.

Exxon Mobil Corp., the largest U.S. energy company, slipped 0.3 percent to $72.61. Crude-oil futures fell 38 cents to $79.05 a barrel in New York as Tropical Depression Ida weakened, allowing workers to return to offshore platforms in the Gulf of Mexico.

AIG, Bank of America

American International Group Inc. climbed 3.9 percent to $37.59. The insurer bailed out by the U.S. will be able to repay its Federal Reserve credit line and “much or all” of the Treasury Department’s investment if financial markets stabilize, Moody’s Investors Service said. AIG owed more than $44 billion on the credit line as of last week and has tapped more than $40 billion from Treasury facilities.

Bank of America gained 1.7 percent to $16.03. Chief Executive Officer Kenneth D. Lewis said the largest U.S. lender by assets expects to achieve 45 percent of its $7 billion in cost savings from acquiring Merrill this year, ahead of the 25 percent anticipated when the transaction was completed.

American Express Co. climbed 1.6 percent to $39.68. The largest credit-card issuer by purchases said worldwide spending climbed 3 percent in October as rising equities may have emboldened affluent customers.

Health Stocks Gain

Health-care stocks in the S&P 500 climbed 0.5 percent as a group, the most among 10 industries. Senate Majority Leader Harry Reid told reporters he expects to bring legislation to overhaul the U.S. health-care system up for debate next week. He believes the Senate can pass the measure by the end of the year.

Johnson & Johnson, Pfizer Inc. and Abbott Laboratories added at least 0.8 percent.

Bristol-Myers Squibb Co. gained 1.3 percent to $23.34. The drugmaker agreed to license Alder Biopharmaceuticals Inc.’s rheumatoid arthritis treatment in a deal that may be worth more than $1 billion.

FedEx Corp. added 1.1 percent to $82.13. The second- largest U.S. package-delivery company projected it will handle about 8 percent more shipments on its busiest day before the Christmas holiday amid “positive signs” for the economy. Monsanto Co. climbed 5.2 percent to $73.66, the most since July, after reconfirming its plan to double 2007 gross profit in 2012. The world’s largest seed producer increased its expectation for 2010 sales of two seeds by at least 14 percent and said it will advance nine biotech seeds in the pipeline by January.

Beazer, Priceline Rally

Beazer Homes USA Inc. rose 8.7 percent to $5.10 after posting its first quarterly profit in three years. The homebuilder said revenue for the fiscal fourth quarter fell to $376.3 million from $649.8 million a year earlier, beating the $334.7 million average analyst estimate.

Priceline.com Inc. added 18 percent to $204.22 for the stock’s steepest advance since February 2008 and the biggest gain in the S&P 500. The online travel agency reported third- quarter sales and profit that topped analysts’ estimates, buoyed by the summer travel season.

The dollar was little changed after slumping to a 15-month low against the currencies of major U.S. trading partners yesterday.

Shares of U.S. companies with the most overseas sales are doing best this year on speculation the dollar’s slide is boosting earnings.

Dollar’s Impact

S&P 500 companies generating more than half of their revenue abroad have beaten those doing business only in the U.S. by 27 percentage points, according to data compiled by research firm Bespoke Investment Group LLC. The falling dollar makes American goods more competitive overseas and boosts revenue when foreign currencies are brought back to the U.S.

The S&P 500 is now trading at about 17 times its members’ estimated earnings, according to Bloomberg data, compared with an average ratio of 14.9 since the data starts in 2006. Jeremy Grantham, the chief investment strategist at Boston-based Grantham Mayo Van Otterloo & Co., wrote last month that the “fair value” for the S&P 500 is around 860, or about 21 percent below today’s close.

Billionaire investor Kenneth Fisher said the S&P 500 will probably exceed 1,300 as early as February because the economy continues to rebound from the worst recession since the 1930s.

The index will add up to 25 percent from last week’s close in the next three months, said Fisher, 58, who oversees $35 billion as chairman of Woodside, California-based Fisher Investments Inc.

“It’s just a reversal of excessive pessimism,” Fisher, ranked by Forbes magazine as the 289th-richest person in the U.S., said in an interview yesterday. “We still have a lot more bull market to go because we had such a huge bear market.”

To contact the reporter on this story: Mary Childs in New York at mchilds4@bloomberg.net.

Last Updated: November 10, 2009 16:32 EST