This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
$1 buys you full access to ALL of TheStreet's Subscription Services! Learn More

Stocks Climb on Positive Earnings Kickoff

Stocks in this article: ^DJI^GSPC^IXICAAATINFLXTSLAISRGBKS

NEW YORK ( TheStreet) -- Major U.S. stock markets booked a fourth consecutive session of gains as investors were emboldened by an encouraging start to the new earning season led by Alcoa's ( AA) report Monday evening and the company's reassurances on China demand.

The S&P 500 rose 0.72% to 1,652.32. The Dow Jones Industrial Average gained 0.5% to 15,300.34. The Nasdaq advanced 0.56% to 3,509.26.

"I think the rise in the short run is Newtonian physics: an object at rest can stay at rest, an object in motion tends to stay in motion," said Mark Travis, president of Intrepid Capital Funds. "There's just a feeling that things are improving and we're the best house in a bad neighborhood maybe."

After the market close Monday, Alcoa reported second-quarter losses following restructuring costs, yet still managed to beat analysts' expectations. Alcoa reported a loss of 11 cents a share, losing $119 million for the quarter. Excluding restructuring and legal fees, the company earned 7 cents a share on $5.85 billion in revenue. Analysts polled by Thomson Reuters were looking for earnings of 6 cents a share on $5.83 billion in sales.

The company also eased some worries about the economy slowing in China, on Monday maintaining its estimate that global aluminum demand would persist at a 7% pace this year, spearheaded by demand in China where Alcoa reiterated its growth improvement outlook of 11%.

Shares pulled back 0.13% to $7.91, reversing earlier gains.

Tuesday is a relatively light day on earnings and economic data. On Friday, JPMorgan ( JPM) and Wells Fargo ( WFC) will lead the kickoff of bank earnings.

Paul Pagnato, the Washington D.C.-based partner and managing director of HighTower's Pagnato-Karp Group which oversees more than $2 billion in client assets, said the market's been up for four days in a row thanks to hopes that Alcoa's positive report will be the first of many this earnings season.

"I do feel optimistic and that's because all the economic indicators in our country seem very, very good," Pagnato said during an interview at TheStreet's headquarters in New York. "So getting back to the housing market, the employment market, the purchases of cars ... If you look at the broad-based economic indicators, things look positive. And when the majority of economic indicators are starting to point in a positive direction, you should have good earnings."

Pagnato added that the chances of earnings beats also have increased this earnings season because during last quarter's outlook announcements, CEOs and CFOs of S&P 500 corporations did a "good job" of revising estimates downward, helping to lower the bar for this season.

Netflix was one of the top percentage gainers Tuesday on the S&P 500 after the company announced that it had extended an agreement with CBS (CBS) to continue streaming the television giant's shows. The announcement may not have come as a shock as CBS CEO Leslie Moonves had said in December that he would likely exercise an option to extend a two-year Feb. 2011 deal. Shares jumped 6.1% to $247.38.

Tesla Motors ( TSLA) rose 1.5% to $123.45 after the late Monday announcement that the Palo Alto, Calif.-based company will be joining the NASDAQ-100 Index and the NASDAQ-100 Equal Weighted Index next week underscored the coming of age of the electric car and the Model S, and most importantly, Tesla itself.

Barnes & Noble ( BKS) popped 5.4% to $18.61 after the company announced that William Lynch has resigned as CEO and director of the company effective immediately. The announcement comes as the company continues to lag in the fast-expanding tablet and e-reader markets.

According to Thomson Reuters data, earnings of S&P 500 companies are expected to increase 2.9% for the second quarter.

In other corporate news, Intuitive Surgical ( ISRG) was the largest percentage loser after the medical devices maker announced that its second-quarter revenue will likely miss Wall Street targets. Furthermore, no less than three brokerages have now lowered their ratings and price targets on Intuitive Surgical. Shares fell 16.2% to $419.30.

August gold futures gained $11 to settle at $1,245.90 an ounce Tuesday, while August crude oil futures closed up 39 cents to $103.53 a barrel.

Meanwhile investors Tuesday were also awaiting minutes from the Federal Open Market Committee's June 18 to 19 meeting scheduled for Wednesday to gather more information on the central bank's stimulus tapering timeline.

Written by Andrea Tse and Joe Deaux in New York

>To contact the writer of this article, click here: Andrea Tse.>.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,806.45 -8.49 -0.05%
S&P 500 2,068.45 +1.42 0.07%
NASDAQ 4,769.6430 +11.3910 0.24%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs