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February 12, 2013

Stocks edge higher in early trading

From The Associated Press

NEW YORK — Stocks edged higher in early trading Tuesday following mixed earnings reports from companies including Avon, Goodyear and Coca-Cola.

The Dow Jones industrial average rose 30 points to 13,981 in the first hour of trading. The Standard & Poor’s 500 was up two points at 1,519. The Nasdaq was up three at 3,194.

Avon, a direct seller of beauty products, jumped $2.68, or 16 percent, to $19.97 after the company posted a fourth-quarter loss that wasn’t as bad as analysts had expected. Avon hopes to save $400 million by slashing costs. Michael Kors, a luxury clothing and accessories seller, rose $6.30, or 11 percent, to $63.23 after reporting earnings that beat analysts’ predictions.

Coca-Cola, the world’s largest beverage company, fell 61 cents to $38.03 after reporting fourth-quarter revenue that fell short of analysts’ forecasts. Goodyear Tire & Rubber sank 6 percent to $13.11 after the company cut its forecast for full-year earnings, blaming weakness in the European economy.

About 70 percent of companies in the S&P 500 have reported earnings for the fourth quarter. Analysts are projecting that earnings will rise 6.4 percent for the period, an improvement from the 2.4 percent growth reported in the third quarter, according to S&P Capital IQ.

A start-of-the-year rally that pushed indexes close to record highs has slowed down. The S&P 500 is up 1.3 percent this month, following a 5 percent gain in January. The Dow has advanced 0.8 percent in February, after surging 5.8 percent a month earlier, logging its best January in almost two decades.

Stock advanced at the start of the year after lawmakers reached a last-minute deal to avoid the “fiscal cliff” of sweeping tax increases and spending cuts. Investors are also becoming more optimistic that the housing market is recovering and that hiring is picking up.

Investors will be watching closely Tuesday night when President Barack Obama delivers his annual State of the Union speech. Obama is expected to focus on the economy, including job creation.

A decline in bond prices since the beginning of the year has also slowed. The yield on the 10-year Treasury note, which moves inversely to its price, rose 3 basis points to 1.99 percent. The yield was 1.71 percent at the beginning of the year.

Among other stocks making big moves:

— Masco jumped $2.23, or 13 percent, to $20.02 after the home improvement and building products company reported earnings that beat analysts’ expectations thanks to strong demand in North America.

— Dun & Bradstreet, a provider of credit and business data, fell $7.44, or 9 percent, to $77.92 after the company reported that a fourth-quarter profit that came in below market expectations.

 

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