July 18 (Bloomberg) -- U.S. stocks snapped a six-week losing streak after better-than-estimated results from Citigroup Inc., JPMorgan Chase & Co. and Wells Fargo & Co. alleviated concern that earnings will extend their yearlong slump.

Citigroup lifted the Dow Jones Industrial Average to the steepest three-day gain since March 2003 as financial shares, the year's worst performers, jumped 21 percent since July 15. Google Inc. tumbled the most since the Internet search engine went public in 2004 and Microsoft Corp. fell today after they posted disappointing profits. More than half of the 22 financial companies that have reported during the second-quarter earnings season have topped analysts' estimates.

The S&P 500 added 0.36 point to 1,260.68 today, giving the benchmark a 1.7 percent gain since July 11 and ending the longest stretch of weekly losses in four years. The Dow average climbed 49.91, or 0.4 percent, to 11,496.57. The Nasdaq Composite Index fell 29.52, or 1.3 percent, to 2,282.78. Eight stocks retreated for every seven that rose on the New York Stock Exchange.

``I don't think anybody would've thought this quarter that the good news was going to come from the financials, and that's where we've been seeing the good news coming from,'' Michael Magiera, senior analyst at Manning & Napier Advisors Inc., said on Bloomberg Television. The Fairport, New York-based firm manages $17 billion.

The reports from Citigroup, JPMorgan and Wells Fargo eased investor concern about how much more capital financial firms need to raise because of the U.S. housing slump. The S&P 500 Financials Index surged 21 percent since July 15. Twelve of the 22 companies in the group that have reported results so far have beaten estimates.

$13.5 Trillion

The combined value of global equities still has fallen by about $13.5 trillion since October as more than $447 billion in credit-related losses prolong the global economy's slump and rising commodity prices stoke inflation.

Among the 23 industrialized nations in the MSCI World Index, only Canada has averted a bear-market decline of 20 percent. U.S. stocks have fared better than European and Asian equities, measured by the performance of broad benchmark indexes. The S&P 500's 14 percent retreat this year, including an 11 percent drop in the six weeks ended July 11, compares with losses of 17 percent for the U.K.'s FTSE 100 Index, 21 percent for the German DAX Index and 15 percent for Japan's Topix Index.

Citigroup gained $1.38, or 7.7 percent, to $19.35 for the biggest advance in the Dow average. The biggest U.S. bank by assets, which is still down 34 percent in 2008, posted a loss of 49 cents a share from continuing operations. That was less than the 60-cent loss analysts estimated on average in a Bloomberg survey. Citigroup took about $7.2 billion of credit-market writedowns.

Fannie, Freddie Rebound

Fannie Mae and Freddie Mac, the two largest U.S. mortgage finance companies, extended their rebounds from 17-year lows reached on July 15. Freddie Mac received clearance to register with the U.S. Securities and Exchange Commission to raise $5.5 billion of capital under a plan announced in May. Fannie Mae rallied 23 percent to $13.40, bringing its three-day advance to 90 percent. Freddie climbed 10 percent to $9.18, capping a three-day advance of 75 percent.

The S&P 500 Information Technology Index slumped 1.5 percent, its first retreat in four days and the biggest decline by any of the index's 10 industries.

Google fell $52.12, or 9.8 percent, to $481.32. The company posted second-quarter profit of $3.92 a share, excluding costs such as stock compensation. Analysts estimated $4.73 on average in a Bloomberg survey.

2.3% Profit Miss

Microsoft retreated $1.66, or 6 percent, to $25.86. The world's biggest software maker reported 2.3 percent less fourth- quarter profit than analysts estimated. The company, whose shares have fallen 27 percent this year, predicted first-quarter earnings as low as 47 cents a share. Analysts polled by Bloomberg anticipated 49 cents a share, on average.

Advanced Micro Devices Inc. fell 12 percent to $4.65, its biggest drop since October 2006 and the most in the S&P 500. The chipmaker reported a wider loss after writing down the value of its 2006 purchase of ATI Technologies Inc. by $880 million. Chief Executive Officer Hector Ruiz resigned, passing the reins to Chief Operating Officer Dirk Meyer.

``In this market, the penalty for disappointment is greater than the benefit for meeting guidance,'' said Michael Chren, who manages $1.2 billion as senior portfolio manager at Allegiant Asset Management Co. in Palm Beach Gardens, Florida. ``You're seeing incredible violence in the market.''

Four Straight Quarters

Sixty-seven S&P 500 companies that reported second-quarter earnings missed the analyst estimate by 0.9 percent on average, according to data compiled by Bloomberg. As of the close of trading yesterday, results were running 6.7 percent ahead of forecasts. Analysts project profits fell 16 percent during the period, the fourth consecutive decline. That would be the longest streak in six years, Bloomberg data show.

Supervalu Inc. fell 11 percent to $27.70. The second-biggest U.S. supermarket chain may follow rivals in lowering its projection for sales at stores open at least a year, according to Morgan Stanley.

Gilead Sciences Inc. lost almost 11 percent to $49.53. The drugmaker reported 2.2 percent less second-quarter profit than analysts estimated, the first profit miss since at least 2004, according to Bloomberg data.

Batman

Mattel Inc. rose 13 percent to $20.66. The world's largest toymaker reported second-quarter profit that declined less than analysts estimated after international sales increased and kids bought Batman action figures.

Barr Pharmaceuticals Inc. gained 11 percent to $63.43. Teva Pharmaceutical Industries Ltd., the world's biggest maker of generic drugs, agreed to buy rival Barr for $7.46 billion to expand into new markets and widen its lead in copying brand-name medicines. Teva's American depositary receipts rose 4.4 percent to $42.87.

Schlumberger Ltd. led a rally in energy shares as record oil boosted earnings. Its stock rose $3.77, or 3.9 percent, to $100.55. The world's biggest oilfield-services provider said second-quarter profit increased 13 percent as record oil prices prompted customers to boost exploration and production spending.

To contact the reporter on this story: Elizabeth Stanton in New York at estanton@bloomberg.net.

Last Updated: July 18, 2008 16:37 EDT