U.S. stocks surged Tuesday as investors digested stellar economic data that appeared to put the housing and financial crises far in the rearview mirror.
Photographer: Spencer Platt
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NEW YORK -- U.S. stocks edged higher Tuesday, but the gains were slim as the investors digested another round of earnings reports and ahead of President Obama's State of the Union address in the evening.
The Dow Jones industrial average rose 0.2%, while the S&P 500 and Nasdaq added 0.1%.
The tail end of earnings season continues to paint a fairly healthy picture of Corporate America. But with little else to glom onto, investors aren't willing to place any big bets.
More than 350 companies in the S&P 500 had reported results for the fourth quarter, with 70% beating earnings forecasts and 66% topping revenue estimates, according to Thomson Reuters.
Markets have had a good run so far in 2013. The Dow and S&P 500 are both up nearly 7% and still within range of their all-time highs, while the Nasdaq has gained nearly 6%.
Barclays posted a drop in profit and announced that it is cutting 3,700 jobs. Shares of the British bank spiked almost 8%.
Shares of McGraw-Hill, the owner of rating agency Standard & Poor's, edged lower after the company reported a rise in revenue and logged quarterly earnings per share that were in line with expectations.
Meanwhile, Coca-Cola declined after reporting earnings that slightly topped expectations, while Michael Kors shares jumped 10% after delivering results that blew past forecasts.
At 2 p.m. ET Tuesday, the Treasury Department will release its monthly budget data.
Later Tuesday, President Obama will deliver the first State of the Union address of his second term. He is expected to focus on the economy , jobs and the budget, while also speaking about gun control and immigration.
U.S. stocks drifted lower Monday, after the recent run-up that pushed the Dow and S&P 500 near all-time highs.
Overseas, G-7 finance ministers reaffirmed their commitment to have "market determined exchange rates" early Tuesday. The statement also mentioned having each countries' fiscal and monetary policy focus on domestic issues and "not target exchange rates."
The statement comes amid growing concern that the economic policies of Japanese Prime Minister Sinzo Abe are aimed at spurring economic growth by driving the value of the yen lower in order to boost exports income. Japan is one of the members of the G-7.
European markets were mostly higher in afternoon trading on subdued corporate earnings outlooks.
Japan's Nikkei ended up 1.9% after favorable monetary policy comments from contenders to be the next Bank of Japan governor.
Meanwhile, South Korea's KOSPI reversed early gains to close down 0.3%, after North Korea conducted an underground nuclear test. International institutions and governments were quick to condemn the test, but market reaction was muted. Exchanges in Hong Kong and Shanghai were closed for the Lunar New Year holiday.
The dollar was lower versus the euro and the Japanese yen, but gained ground versus the British pound.
Oil priced edged higher, while gold prices fell slightly.
The price on the 10-year Treasury note declined, sending the yield up to 1.99% from 1.95% late Monday.
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