Stocks Lifted by Earnings, Consumer Confidence

NEW YORK ( TheStreet) -- Stocks had a strong finish to the day after all three major indices hit 52-week highs on a better-than-expected read for April consumer confidence and encouraging earnings reports.

The Dow Jones Industrial Average finished up by 115 points, or 0.9%, at 12,595. The S&P 500 was higher by 12 points, or 0.9%, at 1347, and the Nasdaq was ahead by 22 points, or 0.8%, at 2848. The indicies all hit 52-week highs Tuesday.

Consumer confidence rose to a better-than-expected level of 65.4 in April after a March reading of 63.8, the Conference Board said. According to Briefing.com, economists had been forecasting an April reading of 64.4.

"The gain over the last month, while not substantial, is nonetheless encouraging given the recent spike in food and fuel prices," said Jim Baird, partner and chief investment strategist for Plante Moran Financial Advisors in a recent note. "The survey suggested that inflation expectations actually eased a bit, while consumers viewed current broad economic conditions more favorably for the seventh consecutive month."

Baird added that inflationary pressures pose the biggest near-term risk to consumer confidence and spending since higher prices could force consumers to make budget cuts, thereby slowing the pace of economic recovery.

Shares of airline carriers and railroads ended with some of the strongest gains, with SkyWest ( SKYW ) up 2.9% to $16.26 and RailAmerica ( RA) 2.9% higher at $17.13.

On the Dow, Cisco Systems ( CSCO), Caterpillar ( CAT), Intel ( INTC), Microsoft ( MSFT), Merck ( MRK) and United Technologies ( UTX) were traded at the top. Stocks such as W&T Offshore ( WTI), Kindred Healthcare ( KND), Carpenter Technology ( CRS) ended ahead by 18%, 18% and 10%, respectively, as they hit 52-week highs.

Coca-Cola ( KO), which missed expectations with adjusted earnings of 86 cents a share and sales of $10.51 billion, was the Dow's biggest laggard. The stock fell 1.2% at $66.93.

Basic materials stocks showed some of the weakest performance of the session. Shares of United States Steel ( X) lost 4.1% at $49.72 after the company posted a wider-than-expected loss in the first quarter .

Shares of AK Steel ( AKS), however, rose 6.4% to $16.96 after the steel producer posted a surprise profit of 8 cents a share .

Dow component 3M ( MMM) surpassed Wall Street's expectations with earnings of $1.49 a share on sales of $7.3 billion. The stock gained 1.9% to $95.94.

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