Wall Street hits best on strong earnings, debt talk

13:30, July 20, 2011      

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U.S. stocks surged on Tuesday on strong earning reports from blue-chip companies and debt hopes, with the Dow jumping over 200 points and the Nasdaq rising over 2 percent.

The Dow Jones industrial average gained 202.26 points, or 1.63 percent, to 12,587.42, hitting its biggest one-day gain since December.

The Nasdaq Composite Index rose 61.41 points, or 2.22 percent, to 2,826.52, achieving its biggest one-day gains since March.

The Standard &Poor's 500 rallied 21.29 points, or 1.63 percent, to 1,326.73.

U.S. President Barack Obama endorsed Tuesday the debt deal proposed to cut the deficit by more than 4 trillion dollars.

Moreover, Republican senator Roger Wicker said that a bipartisan budget plan introduced Tuesday could pass the Senate with a majority of 60 to 70 votes.

On the earnings front, IBM Corp. reported Monday earnings of 2. 9 billion dollars, or 2.31 dollars a share, on revenue of 24.6 billion dollars, up 8 percent from a year ago, beating expectations.

The world's biggest soda maker Coca-Cola posted Tuesday its second quarter earnings of 1.17 dollars versus the average analyst estimate of 1.16 dollars.

Johnson &Johnson said on Tuesday that its second quarter profit was 1.28 dollars a share. The average analyst estimate was 1.24 dollars a share, from last year's 1.21 dollars.

Bank of America on Tuesday posted the biggest quarterly loss in its history as the bank's mortgage-related costs soared.

The largest U.S. bank by assets reported a net loss of 8.8 billion dollars, or 0.90 dollar per diluted share in second quarter, compared with net income of 3.1 billion dollars, or 0.27 dollar per diluted share from the same period last year.

Goldman Sachs Inc., the Wall Street's biggest investing bank by assets, reported earnings for the second quarter on Tuesday, showing rising net income, but still missing the estimation as the fixed-income trading revenue fell sharply.

Goldman said its net earnings for the second quarter reached 1. 05 billion, or 1.85 dollars per share, compared with 78 cents per share in the same period a year earlier and 1.56 dollars in the previous quarter. The analysts' estimation was 2.35 dollars per share.

On economic front, the Commerce Department said housing starts in June rose 14.6 percent to a seasonally adjusted annual rate of 629,000, the highest level since January.

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