Stocks finished modestly higher Wednesday, as a smaller-than-expected trade deficit and some upbeat earnings reports outweighed higher Treasury yields. Near-term oversold conditions and generally bullish earnings sentiment supported equities, says Standard & Poor's MarketScope.
The Dow Jones industrial average rose 40.34 points, or 0.36%, to 11,129.97. The broader Standard & Poor's 500 index added 1.55 points, or 0.12%, to 1,288.12. The tech-heavy Nasdaq composite was up 4.33 points, or 0.19%, to 2,314.68.
World markets were reacting cautiously Wednesday to reports Iran intends to move toward large-scale nuclear programs, says S&P MarketScope. The U.N. wants those programs halted, and Washington is reportedly considering plans to use tactical nuclear weapons against Tehran.
Investors were also digesting a fresh dose of economic data. The U.S. trade deficit narrowed to $65.7 billion in February from $68.6 billion in January. That's narrower than expected and boosts forecasts for first-quarter economic growth, says Action Economics.
Electronics retailer Circuit City (CC) was higher in afternoon trading after posting 65% higher profit for its fiscal fourth quarter. Newspaper publisher Gannett (GCI) was lower after posting an 11.5% first-quarter earnings decline.
Also in earnings, drugmaker Genentech (DNA) was lower after reporting 48% higher first-quarter profit late Tuesday. The company said first-quarter U.S. sales of its leading cancer drug were less than expected.
Chipmaker Advanced Micro Devices (AMD) was set to report quarterly results after the closing bell. Industrial giant General Electric (GE will post earnings Thursday.
Elsewhere, General Motors (GM) led the Dow higher after the automaker said it had record sales in China last year and will boost sales of its Chevrolet-brand cars by at least 50% this year. Rival DaimlerChrysler (DCX) was little changed after its CEO projected higher 2006 profits.
Of other blue-chips in focus, aerospace contractor Boeing (BA) was higher on news of a $5.3 billion aircraft contract with China.
Wireless phone maker Motorola (MOT) was higher after Bear Stearns boosted the stock from peer perform to outperform.
In deal activity, Tivo (TIVO) rose on news of a three-year extension to the company's commercial agreement with satellite TV provider DirecTV (DTV).
Investors will have economic data to consider Thursday ahead of the long weekend. The docket includes February business inventories, March retail sales, March import prices and April consumer sentiment, along with weekly jobless claims.
In the energy markets Wednesday, May West Texas Intermediate crude oil futures closed down 36 cents at $68.62 after weekly inventory data showed an unexpectedly large supply increase.
European markets finished modestly lower. In London, the Financial Times-Stock Exchange 100 index fell 15.7 points, or 0.26%, to 6,000.8. Germany's DAX index was off 7.22 points, or 0.12%, to 5,901.25. In Paris, the CAC 40 index dropped 27.49 points, or 0.54%, to 5,085.11.
Asian markets finished lower. Japan's Nikkei 225 index tumbled 255.58 points, or 1.47%, to 17,162.55. In Hong Kong, the Hang Seng index fell 165.05 points, or 1%, to 16,310.76. Korea's Kospi index slipped 2.49 points, or 0.18%, to 1,383.59.
Prices for 10-year Treasury notes were lower at 96-11/32 with a yield of 4.97%, while 30-year bonds fell to 91-20/32 for a yield of 5.05%.