NEW YORK (
TheStreet) - U.S. stocks snapped a five-day losing streak on Wednesday with buyers out in force as anxiety over the eurozone eased and
(AA) profit surprise lifted hopes for a better than expected first-quarter reporting season.
Spanish bond yields stabilized Wednesday after a European Central Bank official hinted at intervention if the situation in the country deteriorated. The markets were on high alert Tuesday, as yields spiked after Spain warned its banks may need more capital if the economy there weakens further.
Dow Jones Industrial Average rose 89 points, or 0.7%, to close at 12,805. The index's session high was 12,844. Alcoa,
Bank of America
(VZ) were the biggest percentage gainers among the blue chips.
S&P 500 advanced 10 points, or 0.7%, to finish at 1369. The
Nasdaq jumped 25 points, or 0.8%, to settle at 3016.
Breadth within the Dow was positive with 24 of the 30 components on the rise.
were among the few laggards.
Advancers also far outnumbered decliners on both major U.S. exchanges, 2428 to 645 on the New York Stock Exchange, and 1964 to 549 on the Nasdaq.
Stocks sustained deep losses Tuesday with eurozone worries flaring up amid growing trepidation over Spain's economic stability.
"The market was ripe for a pullback and we got it," says Peter Cardillo, chief market economist at Rockwell Global Capital, earlier in the morning. "A close above some of the key technical levels, with the S&P at 1373-1374, would probably mean that the market will begin to focus more on earnings and that the pullback will be short-lived."
While the S&P 500 failed to break past those levels, the Nasdaq did manage to close above the psychological mark of 3,000.
Shares of Alcoa rose 6.2% Wednesday after the aluminum giant reported a surprise quarterly profit after the markets closed Tuesday. The first Dow component to report its results each quarter, Alcoa said it earned $94 million, or 10 cents a share, on revenue of $6.01 billion in the first three months of 2012. The average estimate of analysts polled by
was for a loss of 4 cents a share on revenue of $5.77 billion.
The company attributed the better-than-expected results to "strong productivity improvements across all businesses, higher realized prices for aluminum, and improved volume and mix." Alcoa also reaffirmed its outlook for 7% growth in global aluminum demand in 2012.
Bank of America gained nearly 4% to $8.86. Guggenheim Securities analyst Marty Mosby upgraded the stock to buy from neutral. In his report, the analyst argued that shares "have traded down 15%, since peaking at $10 following the company's successful result from the Federal Reserve's annual stress tests in March, creating "a 29% upside potential to our price target, which we believe, even with BAC's heightened risk profile, justifies a buy rating."
Both Spanish and Italian bond yields eased Wednesday as the European stock markets regained some composure after their worst one-day drop in more than a month Tuesday.
London's FTSE settled up 0.7% and Germany's DAX gained 1%.
European Union and Spanish officials have been trying to calm the markets by insisting that Spain's economy will not be brought to its knees with the phase-in of austerity measures and won't be next in line to seek money from the strained eurozone bailout fund.
"We have a government in Spain that has taken very strong deficit measures," Benoit Coeure, a European Central Bank executive board member said in a speech in Paris, according to
. "All this takes time. The political will is enormous. This is what leads me to say the market conditions are not justified."
"Will the ECB intervene? We have an instrument, the securities markets program, which hasn't been used recently but still exists."
Elsewhere, Japan's Nikkei Average finished lower by 0.8% and Hong Kong's Hang Seng index fell 1.1%.
A tsunami watch was issued Wednesday across the Indian Ocean region after an earthquake, initially measured at 8.9, struck under the sea off the Indonesian province of Aceh. The earthquake was felt as far away as Singapore, Thailand, Bangladesh, Malaysia and India, according to reports.
In U.S. economic news, the Fed's Beige Book report, which outlines economic conditions across the central banks' 12 reporting districts, struck a broadly positive tone, although manufacturers continued to highlight rising petroleum prices as a source of concern.
The central bank said the economy continues to expand at a "modest to moderate" pace, with manufacturing, consumer spending and loan demand showing signs of improvement in several districts, also aided sentiment. Hiring was steady or up slightly across many districts, but employers frequently complained of difficulty in finding qualified workers for high-skilled positions, according to the report.
Before the opening bell, the Commerce Department said that import prices rose 1.3% in March, more than expected, compared with a downwardly-revised decline of 0.1% in February as fuel and industrial material costs rose.
Import prices excluding the fuel component climbed 0.5%. Export prices also increased more than expected, up 0.8%, compared to a gain of 0.4% in February. The rise in both import and export prices were the largest since 2011.
In corporate news,
, a publisher of travel newsletters and Web sites, is planning to sell itself, three people familiar with the matter told
The Internet company is in the process of hiring a financial adviser, the sources said. Based on Tuesday's closing price of $21.06, Travelzoo's market capitalization was $331.6 million. The stock jumped 28% at $27.06.
Travelzoo's move comes after it received takeover interest from private-equity firms and trade buyers, the sources said,
The list of potential buyers could include
, said Dan Kurnos, a research analyst at The Benchmark Company.
American International Group
is planning to jump back into U.S. property investing,
The Wall Street Journal
The move is a reversal of a years-long effort to downsize its real-estate business in the wake of the government bailout the insurance giant received in 2008. The stock gained 2% to close at $31.87.
plunged more than 15% after the Finnish handset maker lowered its first-quarter guidance.
"During the first quarter 2012, multiple factors negatively affected Nokia's Devices & Services business to a greater extent than previously expected," explained Nokia, in a press release, citing competitive industry dynamics and gross margin declines.
finished flat at $626.20 as investors shrugged off a
that the Justice Department may sue the tech giant for alleged e-book price fixing.
The iPhone maker hit yet another new
during Tuesday's trading as the company's market cap surpassed $600 billion for the first time.
May oil futures rose $1.68 to settle at $102.70 a barrel, while June gold futures slipped 40 cents to settle at $1,660.30 an ounce.
The benchmark 10-year Treasury was declining 15/32, lifting the yield to 2.03%, while the U.S. dollar index eased 0.1% at $79.759.
-- Written by Andrea Tse and Shanthi Bharatwaj in New York.
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