NEW YORK (TheStreet) -- Stocks posted gains Tuesday as investors cheered a better-than-expected read on consumer confidence and overlooked weak home price data and durable goods orders.
Dow Jones Industrial Average
gained 23.6 points, or 0.2%, at 13,005. The
added 4.6 points, or 0.3%, to 1372. The
gained 20.6 points, or 0.7%, at 2987.
The Conference Board's measure of consumer confidence soared to a reading of 70.8 in February from 61.5 in January. Economists were looking for a rise to 63 after an originally reported 61.1 in January.
Stocks rebounded after the release even with the downbeat economic news earlier morning. The latest measure of durable goods orders from the Commerce Department dropped 4% in January, following a 3.2% rise in December. Orders were expected to fall 1% after an originally reported 3% rise the prior month, according to estimates from Thomson Reuters.
Economists said that while the report was disappointing, a one month reading does not confirm any sort of trend. "We see no evidence of underlying slowing in the industrial economy so we look for a rebound in Feb and the re-emergence of the upward trend over the next couple of months," said Ian Shepherson, U.S. economist at High Frequency Economics.
S&P/Case Shiller reported that its 20-city home-price index saw a year-over-year 4% drop in December. Economists were looking for a 3.6% decline. "While we thought we saw some signs of stabilization in the middle of 2011, it appears that neither the economy nor consumer confidence was strong enough to move the market in a positive direction as the year ended," said the release.
The S&P 500 is still up an impressive 4.2% for the month as February draws to a close tomorrow. At the same time, the S&P 500's close at a multi-year high on Monday caused some nervousness that a market top may be coming.
"There's a predisposition of negative sentiment," said Matt Lloyd, chief investment strategist with Advisors Asset Management, adding that many investors are still thinking that what happened in the past will happen in the future. "That's why we're seeing a muddling along in the market."
On Wednesday, the European Central Bank launches its second long-term refinancing operation, which will provide an estimated $630 billion in cheap loans to the region's financial system.
Germany approved Greece's bailout with a parliamentary vote on Monday, after Chancellor Angela Merkel warned that a Greek exit from the euro would lead to "incalculable" damage. Germany's green light puts Greece one step closer to receiving its long awaited second round of funding from European creditors. The next focus for investors will be a summit meeting this Thursday and Friday, at which euro leaders will debate whether to increase the region's bailout firewall.
Ratings firm Standard & Poor's cut Greece's credit rating to "selective default." The move comes after reductions by Fitch Ratings last week and ahead of a Greek bond swap in which some private creditors may resist taking part in the exchange. Greece is now the first eurozone nation to be rated in default.
2012 Stock Predictions and Outlook
Germany's DAX settled up 0.56% and London's FTSE closed up 0.18%. Japan's Nikkei Average settled up 0.92% on Tuesday and Hong Kong's Hang Seng was up 1.65%.
In corporate news,
, the online travel booking services provider, posted fourth-quarter adjusted profit well above Wall Street's expectations. Priceline reported non-GAAP earnings of $276.8 million, or $5.37 a share, on revenue of $991 million for the three months ended Dec. 31. Analysts were expecting earnings of $5.05 a share on revenue of $967.9 million. Shares were up 7% to $632.76.
, the China-based online media company, reported fourth-quarter profit in line with analysts' estimates but revenue came in a smidge lighter than forecasts. Revenue for the quarter was $128.7 million. Analysts were expecting $129.3 million. SINA forecast first-quarter revenue of $101 million to $104 million with advertising revenue seen coming in between $78 million and $80 million. The stock soared 11.3% to $70.04.
If Moody's downgrades
by three notches, the investment bank said it would have to post an additional $6.52 billion in collateral to counterparties. Morgan Stanley, in a filing with the
Securities and Exchange Commission
late Monday, said it would have to post $919 million in the event of a one-notch cut by Moody's; a two-notch cut would require additional collateral of $4 billion. Morgan Stanley shares were down 0.2% to $18.71.
shares were up 0.2% to $30.01 as its cruise liner Costa Allegra is towed to the Seychelles after a fire broke out on the ship, on which there are 636 passengers and 413 crew. No injuries were reported. This is Carnival's second accident in recent weeks. On Jan. 13, its Costa Concordia cruise liner capsized off the coast of Italy, causing the deaths of 25 passengers.
has reported second-quarter net income of $166.9 million, or $4.15 a share on sales of $1.8 billion. Analysts on average were expecting earnings of $4.04 a share on sales of $1.78 billion. Shares advanced 2.8% to $376.41.
reported fourth-quarter adjusted earnings of 3 cents a share and sales of $2.97 billion. Analysts on average were expecting breakeven earnings per share and revenue of $3 billion. Shares jumped 18.9% to $3.59.
April oil futures fell $2.01 to $106.55 a barrel. Oil retreated from the $110 mark in the prior trading session after topping $109 a barrel last week. In other commodities, April gold futures closed up $13.50 to $1,788.40 an ounce.
The dollar index was down 0.4%. The benchmark 10-year Treasury was down 6/32, raising the yield to 1.946%.
-- Written by Andrea Tse and Chao Deng in New York
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