Strong earnings push Dow toward 13,000

Stocks advance sharply after Google, other firms exceed profit expectations

? Wall Street bounded higher Friday, hurtling the Dow Jones industrial average to a record close approaching 13,000 as investors celebrated a week of surprisingly strong earnings reports. The major indexes all had their third straight winning week, their longest such streak since October.

Investors who had tempered their expectations for first-quarter earnings Monday were energized by the initial wave of upbeat results. So far into the earnings season, 16 of the 30 Dow components have posted financial results for the first three months of the year – with 10 surpassing analyst forecasts. Dow components Honeywell International Inc., Caterpillar Inc., Pfizer Inc. and McDonald’s Corp. all reported earnings Friday.

Better-than-expected results allowed stocks to extend their best April rally in four years, and one that pushed the Nasdaq composite index and the Standard & Poor’s 500 index to six-year highs.

“It’s not a matter of 13,000 for the Dow; we could be looking at 14,000 by the end of the year,” said Robert Froehlich, chief investment strategist for investment firm DWS Scudder. “There’s too much money out there chasing too few companies. This story isn’t ending anytime soon.”

The Dow closed up 153.35, or 1.20 percent, at 12,961.98, after setting a new intraday high of 12,966.29. The blue chip index – now about 38 points shy of 13,000 – has hit 34 record closes since the beginning of October last year.

The S&P 500 index soared 13.62, or 0.93 percent, to 1,484.35, and the Nasdaq rose 21.04, or 0.84 percent, to 2,526.39. The Nasdaq, badly beaten down since its peak of 5,048.62 in early 2000, now stands at just over 50 percent of that record.

For the week, the Dow surged 2.8 percent, the S&P 500 added 2.2 percent, and the Nasdaq rose 1.4 percent.

Oil prices rose ahead of the presidential election in Nigeria, which is Africa’s top producer of crude. A barrel of light sweet crude rose $1.55 to settle at $63.38 on the New York Mercantile Exchange.

Google gave a boost to technology stocks after it reported late Thursday a 69 percent jump in first-quarter profit to exceed analyst expectations. The results helped reassure some investors who had grown cautious about tech growth, and sent Google up $10.83, or 2.3 percent, to $482.48.

Caterpillar was the Dow’s biggest mover after the manufacturer of heavy equipment posted better-than-expected quarterly profit and issued robust profit guidance. Shares rose $3.20, or 4.7 percent, to $71.82.

Honeywell International rose $2.34, or 4.8 percent, to $51.40 after the industrial conglomerate topped Wall Street projections.