Stocks Up Amid Earnings News, Manufacturing Data

Blue-chip stocks rose Thursday after regional manufacturing data suggested business conditions could improve in coming months, while technology shares jumped on positive earnings news  from Finnish mobile phone maker Nokia Corp.(NOK).

The Dow Jones industrial average ended up 80.04 points, or 0.97 percent, at 8,337.65, according to the latest available data. The broader Standard & Poor's 500 Index gained 13.67 points, or 1.55 percent, at 893.58. The technology-laced Nasdaq Composite Index advanced 30.78 points, or 2.21 percent, at 1,425.50.

With almost a third of the companies in the Standard & Poor's 500 index having reported, investors are happy that results were in line with expectations or even a little better.

"Earnings in the first quarter were OK. The market is relieved there were no disasters. In general, outlooks have been realistic," said Arnie Owen, managing director of equities at Roth Capital Partners in Newport Beach, California.

Stocks rose across the board, with advancing issues beating declining shares by almost 3 to 1 on the New York Stock Exchange, and by more than 2 to 1 on Nasdaq. Only three of the 30 stocks in the Dow Jones industrial average fell, and all three market gauges rose for the week.

For the week, the Dow rose 1.6 percent, the Nasdaq gained 4.9 percent and the S&P 500 index advanced 2.9 percent.  U.S. financial markets will be closed for Good Friday.

Technology stocks were lifted by growth prospects at Nokia and Broadcom Corp. (BRCM). Nokia said second-quarter sales at its cellphone unit would rise between 4 percent and 12 percent, reflecting global economic uncertainties. But it was a step up from 1 percent growth in the first quarter.

Nokia, the most active issue on the NYSE, jumped $1, or 6.59 percent, to $16.18.

Broadcom surged 18 percent after the semiconductor designer said it expects second-quarter revenue to rise 12 percent to 14 percent from the previous period on stronger chip sales and cost cutting. Its first-quarter earnings, excluding charges, also topped analysts' expectations. Broadcom's stock, among the Nasdaq's most active, rose $2.55 to $16.60.

"A lot of people are making a bet on the earnings leverage of the technology companies. That's why that group is outperforming," said Cary Nordan, equity analyst at BB&T Asset Management. "The question is: Does this growth accelerate this summer or would it be like last year, when growth decelerated?"

Stocks got a boost after a Philadelphia Federal Reserve survey showed a weak regional economy, but companies reported "a fairly high degree of optimism" about the future. The Dow reversed losses when the report was released at midday.

"There's a huge disparity between the companies' views of current conditions and their views of likely conditions in the future," said Patrick Fearon, an economist at A.G. Edwards & Sons. "That could mean that business spending, including business hiring, might be improving in the coming months."

Earlier, the Dow had declined after a U.S. jobless report was worse than expected, reflecting increased layoffs in the auto industry as the world's richest economy limped forward.

But earnings have been better than expected. Earnings in the first-quarter have increased 10.2 percent over year-ago results, compared with expectations for growth of 8.5 percent, according to Thomson First Call.

"Coming into this earnings season, many market commentators said earnings would be quite dismal. Most commentators believed because of geopolitical events -- the war in Iraq -- the economy would have been very muted. However, there have been some fairly strong earnings," said Erik Gustafson, senior portfolio manager at Columbia Management Group.

Shares of United Technologies (UTX), which makes Black Hawk helicopters and Carrier air conditioners, fell $2.27, or 3.65 percent, to $60, pressuring the Dow. Net income climbed to $502 million, or $1 a share, up from $467 million, or 92 cents a share. But the company warned of a tough second quarter, blaming continued turmoil in the commercial aviation market.

Sears, Roebuck and Co. (S), the largest U.S. department store chain, said weak sales and increased reserves for bad credit-card debt sapped first-quarter profit, and it warned second-quarter earnings would miss analysts' estimates.

Sears slipped 1 cent to $26.63.

PepsiCo Inc. (PEP) said first-quarter profit rose nearly 13 percent as chilly weather drove up sales of Quaker oatmeal, offsetting a drop in its North American soft-drink business.

Earnings also benefited from cost cuts related to PepsiCo's acquisition of Quaker, the maker of Gatorade sports drinks, and a gain on the sale of Quaker's Mission pasta business.

PepsiCo shares rose 6.6 percent or $2.64 to $42.54.

Honeywell International Ltd. (HON) reported first-quarter net income fell 32 percent, and warned full-year earnings would be at the bottom of its forecast as key commercial aviation customers cut orders. Its shares gained 18 cents to $22.56.

Delta Air Lines, citing "the greatest financial crisis" in its history, posted the airline industry's biggest loss yet for the first quarter, and said it will furlough 200 pilots as the sector grapples with a crippling downturn.

Atlanta-based Delta (DAL), the No. 3 U.S. air carrier, said the war in Iraq had depressed travel demand further. Delta shares, however, rose $1.26, or 12 percent, to $11.75, after hitting a session low of $10.86 earlier in the day.

On the employment front, first-time jobless claims rose by 30,000 to a seasonally adjusted 442,000 for the week ended April 12, the Labor Department said. It was the ninth straight week that claims held above the key 400,000 level, regarded by economists as a sign of an unhealthy labor market.

The gain was well above economists' expectations that jobless claims would edge up to 411,000.

"I think the jobless number still reflects uncertainty about the war," said Phil Flynn, vice president and senior market analyst with Alaron Trading Corp.

"These weekly numbers can be somewhat erratic, so even though the number is a little bit disappointing, we will have to see the data in the next couple of weeks," he said. "With the weather warming and the war with Iraq over, the job market should start to look a bit more optimistic in the next couple of weeks".

More than 1.38 billion shares changed hands on the New York Stock Exchange, and about 1.6 billion shares traded on Nasdaq.

The Russell 2000 index, a barometer of smaller company stocks, rose 5.97, or 1.6 percent, to 383.70.

Overseas, Japan's Nikkei stock average finished 0.7 percent lower Thursday. In Europe, France's CAC-40 rose 0.1 percent, Britain's FTSE 100 gained 0.9 percent and Germany's DAX index climbed 2.7 percent.

Reuters and the Associated Press contributed to this report.