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Earnings, Data Boost Stock Market

Stocks climb on better-than-expected retail sales and profit reports.

Updated from 4:17 p.m. EST

Stocks in New York finished strong Wednesday as solid earnings reports and better-than-expected retail sales data from the government brought in buyers.

The

Dow Jones Industrial Average

advanced 178.83 points, or 1.45%, to 12,552.24. The

S&P 500

added 18.35 points, or 1.36%, at 1367.21, and the

Nasdaq Composite

climbed 53.89 points, or 2.32%, at 2373.93.

The market gained ground after a government report that showed retail sales unexpectedly rose 0.3% in January. Economists expected a 0.3% decline, which would have fallen in line with the dismal same-store sales results individual retailers posted last week. Excluding autos, retail sales were up 0.3%, slightly above forecasts.

Ian Shepherdson, chief economist with High Frequency Economics, said that the trend for retail sales is still slowing, but the January data could certainly have been worse.

"The big surprise here is the 0.6% rise in auto dealers' sales, despite the automakers' reporting a 6.4% plunge in sales," he said. "Ex-autos, sales were boosted by a 1.4% rebound in clothing sales, partially reversing the 2.3% drop in December."

"All of the things we've been concerned about in the economy are based on the consumer, and this report shows that the consumer isn't rolling over and dying," said Art Hogan, chief market strategist with Jefferies. "That's a good sign. The big argument now is if traders are afraid of missing the bottom or whether they're getting in before the next leg down."

Also on the economic front, the Commerce Department said business inventories rose 0.6% in December, slightly above the expected 0.5% increase.

Breadth was strong for a third straight day. About 3.62 billion shares changed hands on the

New York Stock Exchange

, with advancers beating decliners by a 2-to-1 margin. Volume on the Nasdaq reached 2.16 billion shares as winners edged losers 7 to 3.

Several stronger-than-anticipated earnings reports also helped sentiment.

Coca-Cola

(KO) - Get Coca-Cola Company Report

exceeded the Thomson First Call average estimate for fourth-quarter earnings on an adjusted basis, posting a 79% jump in fourth-quarter profit compared to a year ago. Despite the beat, Coca-Cola shares finished down 53 cents, or 0.9%, to $59.39.

Elsewhere,

Deere

(DE) - Get Deere & Company Report

topped expectations after reporting fiscal first-quarter earnings that rose 54% from the year-ago period.

Waste Management

(WMI)

also exceeded analysts' targets for the fourth quarter. Deere declined 1.1% to $85.54, and Waste Management rose 2.8% to $34.04.

TheStreet Recommends

Jones Apparel

(JNY)

had a fourth-quarter loss of $90 million, but still managed to beat the Thomson First Call estimate on an adjusted basis. Additionally, the company said

Wal-Mart

(WMT) - Get Walmart Inc. Report

would carry the company's girl's denim brand starting in the summer. Jones Apparel jumped $1.70, or 11%, to $17.15.

Tech stocks got a boost from

Applied Materials

(AMAT) - Get Applied Materials, Inc. Report

, which after the prior close posted fiscal first-quarter results that handily beat estimates. Shares of the chip-equipment maker surged $1.84, or 10%, to $19.91.

Away from earnings, traders remained focused on monoline bond insurers

Ambac Financial

(ABK)

and

MBIA

(MBI) - Get MBIA Inc. Report

one day after Warren Buffett, the billionaire chief of

Berkshire Hathaway

(BRK.A) - Get BRK.A Report

, offered to reinsure $800 billion of municipal bonds insured by the companies.

Many reports indicated the deal would be soundly rejected by the insurers. Shares of Ambac and MBIA finished 5.3% and 1.2% higher, respectively, following 15% selloffs last time out.

Stocks overall rallied during Tuesday's session before paring gains into the close. The Dow rose more than 220 points but settled up 133.40, or 1.09%, at 12,373.41. The S&P 500 ended ahead by 9.73 points, or 0.73%, at 1348.86.

The Nasdaq stumbled in the final hour to finish 0.02 point lower at 2320.04.

Investors are also gearing up for remarks from

Federal Reserve

Chairman Ben Bernanke, who will testify Thursday before a U.S. Senate committee on banking and housing.

Treasury prices sank. The 10-year note was down 18/32 in price to yield 3.73%. The 30-year bond was off 1-7/32 in price, yielding 4.53%.

Commodity prices were mixed. Crude oil gained 49 cents to close at $93.27 a barrel despite a bearish inventory report from the Energy Department. Gold futures lost 90 cents to $910.20 an ounce.

Overseas markets were also mixed. Overnight in Asia, Hong Kong's Hang Seng added 1.1% and Japan's Nikkei 225 tacked on 0.4%. Among European bourses, London's FTSE 100 eased 0.5%, while Germany's Xetra Dax was up 0.1%.