By Dan Strumpf
U.S. stocks ended higher, buoyed by a rebound in oil prices and
a handful of positive first-quarter earnings reports.
Energy stocks pulled ahead of the broader market, as crude
prices rose for the fourth straight session. But trading volumes
remained relatively muted, as investors awaited additional
quarterly updates from companies in the weeks ahead.
The Dow Jones Industrial Average gained 59.66 points, or 0.3%,
to 18036.70. The S&P 500 gained 3.41 points, or 0.2%, to
2095.84. The Nasdaq Composite Index slipped 10.96, or 0.2%, to
4977.29.
Energy stocks in the S&P 500 rose 1.8%, benefiting from the
recent rebound in oil prices. U.S. crude futures gained 2.7% to
$53.29 a barrel, their third-highest settlement price of this year.
Oil prices have risen 12% this month, though they are still down
48% from a year ago following a monthslong tumble.
"A lot of people are starting to poke around" in the energy
sector, said Michael Antonelli, an equity sales trader at Robert W.
Baird in Milwaukee. "You've got people digging."
Chevron Corp. shares posted the biggest gain in the Dow, rising
2.2% and contributing 16 points to the index's rise.
Investor focus also fell on the financial sector, which saw two
high-profile earnings reports this week. Shares of J.P. Morgan
Chase & Co. gained 1.6% after the bank reported stronger
first-quarter profit. The gains added about seven points to the
Dow's rise.
Elsewhere in the sector, updates on the first quarter were
mixed. Shares of Wells Fargo & Co. fell 0.7% after the company
reported a rare earnings decline, following pressure on its lending
margins. Amid the uneven quarterly reports, the S&P 500
financials sector ended the session with little change.
Money managers are bracing for one of the weakest quarterly
earnings season in years, with companies pinched by the
strengthening dollar and the tumble in oil prices. S&P 500
companies are expected to post a 4.9% fall in first-quarter
earnings from a year earlier, according to FactSet.
Still, trading volumes were low on Tuesday, suggesting many
investors are sitting out the market ahead of additional updates in
the coming weeks. Just 5.8 billion shares traded hands Tuesday,
below the average for April and for the year.
"We've really seen client activity in the U.S. drop off sharply
as clients wait for more clarity on earnings guidance and on Fed
policy," said Joe Spinelli, head of single stock trading for the
Americas at Deutsche Bank.
Shares of Fastenal Co. gained 4.4% after the nuts and bolts
maker said earnings rose 14% in the quarter ended in March.
Shares of Avon Products Inc. soared 14% after The Wall Street
Journal reported the company was exploring strategic alternatives,
including a possible sale.
In economic news, U.S. retail sales rose 0.9% in March to $441.4
billion, the Commerce Department said Tuesday. That was the biggest
monthly gain in a year, but was weaker than the 1.1% increase
expected by economists.
"You really can't ignore the impact of the significantly
stronger dollar on earnings, especially for multinationals," said
Monica DiCenso, U.S. head of equity strategy at J.P. Morgan Private
Bank.
Ms. DiCenso said she recently cut earnings expectations for the
year, now expecting 4% to 5% earnings growth for the S&P
500.
European stocks were mostly lower. France's CAC 40 fell 0.7% and
Germany's DAX declined 0.9%.
The yield on the 10-year Treasury note fell to 1.904% from
1.938% on Monday. Yields fall as prices rise.
Saumya Vaishampayan contributed to this article.
Write to Dan Strumpf at daniel.strumpf@wsj.com
Access Investor Kit for Avon Products, Inc.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US0543031027
Access Investor Kit for The Dow Chemical Co.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US2605431038
Access Investor Kit for Fastenal Co.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US3119001044
Access Investor Kit for JPMorgan Chase & Co.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US46625H1005
Access Investor Kit for Wells Fargo & Co.
Visit
http://www.companyspotlight.com/partner?cp_code=P479&isin=US9497461015