U.S. stocks gain amid upbeat economic data, earning reports

09:33, April 20, 2011      

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U.S. stocks recovered on Tuesday from a sharp decline in the previous trading session, as data showed U.S. housing starts rose in March and Johnson & Johnson's better-than-expected first quarter earning report helped lift the markets.

After a steep sale in the wake of Standard & Poor's downgrading of U.S. credit outlook a day ago, the equity markets regained some losses on Tuesday's trading session.

The U.S. Commerce Department said housing starts rose 7.2 percent in March to an annual rate of 549,000. New construction in February, which was affected by poor winter weather, was revised up to 512,000 from an original reading of 479,000.

The better-than-expected housing data suggested that the U.S. housing markets were picking up momentum and helped lift the stock markets.

Also, unemployment data added on investors' optimism on the U. S. economy. The U.S. Labor Department said Tuesday that the unemployment rate dropped in 34 states in March, the largest number of states to record a decline since last June.

Meanwhile, the Dow component Johnson & Johnson posted its first quarter earnings on Tuesday, with a profit of 3.5 billion dollars, which was largely due to better-than-expected sales, also stimulating investors' confidence in the equity markets.

The world's largest health-care company surged nearly 4 percent on Tuesday's trading.

Goldman Sachs, the biggest U.S. investment bank, also posted its first quarter earnings on Tuesday, saying that its profit fell 21 percent year-on-year to 2.74 billion dollars, but the drop was smaller than previous estimation by analysts. Its shares dipped 1. 92 dollars, or 1.25 percent, to close at 151.86 dollars per share.

Material and energy sectors were among the best performers on Tuesday as oil price kept rising and the gold hit an all-time high of 1,500 dollars an ounce in midday trading session.

The Dow Jones industrial average gained 65.16 points, or 0.53 percent, to 12,266.75. The Standard & Poor's 500 advanced 7.48 points, or 0.57 percent, to 1,312.62. The Nasdaq Composite index was up 9.59 points, or 0.35 percent, to 2,744.97.

Source: Xinhua
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