Strong earnings from Verizon Communications and a better-than-expected reading on consumer confidence sent stocks modestly higher early today as Wall Street struggled to recover from weeks of heavy selling.
Verizon's bullish second-quarter earnings and positive outlook were a much needed boost to a market that has been slumping for four weeks on concerns over stalled economic growth and a series of second-half profit warnings. Bargain hunting also gave the market a lift.
Investors were also cheered by a very strong consumer confidence report from the Conference Board. The board's consumer confidence index rose to 106.1 in July, the highest level since June 2002 and up from last month's revised reading of 102.8.
"The market is anticipating a slowdown, but we don't see that in the next couple of years," said Lawrence Weissman, who manages the $3.2 billion Smith Barney Large Cap Core Fund. "We're in a much longer-lasting economic recovery."
At 1 p.m., the Dow Jones industrial average rose 79.42, or 0.80 percent, to 10,041.34, breaking above the 10,000 mark for the first time since Friday.
Broader stock indicators were also higher. The Standard & Poor's 500 index climbed 5.48, or 0.51 percent, to 1,089.55, and the Nasdaq composite index was up 15.04, or 0.82 percent, at 1,854.06.
In other economic news, new home sales fell by a less-than-expected 0.8 percent to 1.326 million homes in June. Wall Street had estimated 1.275 million new homes sales for the month.
Verizon surged $1.48 to $37.98 after beating Wall Street expectations by 4 cents per share. The communications company said its earnings outlook was on target for the next quarter.
U.S. Steel Corp. also gave a bullish outlook for the rest of the year, and exceeded analyst estimates on its second quarter earnings by 9 cents per share. U.S. Steel was down 37 cents at $33.55.
Defense contractor Lockheed Martin Corp. fell 40 cents to $51.80 despite its positive earnings, which beat expectations by a nickel per share. The company said its year-end results would likely come in at the high end of Wall Street's estimates.
A reshuffling of the board of directors at Martha Stewart Living Omnimedia sent shares 32 cents higher to $11.32. The company named a new chairman and replaced one of its directors as it refocuses on building its brand after founder Stewart's conviction and prison sentence.
Pulte Homes increased $2.70 to $53. Profit from continuing operations this year will be $7.80 to $8 a share, the company said. It previously expected earnings of as much as $7.25.
L-3 Communications Holdings, the world's second-biggest maker of bomb detectors, rose $1.85 to $58.35. The company said it had a second-quarter profit of 81 cents a share, two cents higher than analysts expected, according to Thomson.
Shares of Cardinal Health lost $6.67 to $43.80. The 13 percent drop was the steepest in the S&P 500. The second-biggest U.S. drug distributor said Richard Miller, 46, resigned as chief financial officer after U.S. regulators stepped up a probe of the company's accounting.
Advancing issues outnumbered decliners by about 3 to 2 on the New York Stock Exchange, where volume came to 653.65 million shares, compared with 576.22 million at the same point Monday.
The Russell 2000 index of smaller companies was up 4.49, or 0.8 percent, at 537.98.
Overseas, Japan's Nikkei stock average tumbled 1.2 percent. In afternoon trading, Britain's FTSE 100 was up 0.9 percent, Germany's DAX index gained 1.6 percent, and France's CAC-40 climbed 0.9 percent.