Strong Earnings Revive Stock Rally

Stocks advanced broadly Thursday, with some indexes hitting record levels, as corporate earnings reports continued to come in strong and soft economic data pushed interest rates lower.

Investors continued to pour money into stock funds, despite a sharp decline of more than 67 points in the Dow Jones industrial average last week.

The Dow briefly hit 4,741.56 before settling back toward the end of the day, closing up 25.71 at 4,732.77, just 5 points shy of the all-time closing high made on July 17.

Advancing issues led decliners by about 7 to 4 on the New York Stock Exchange. Big-Board volume came to 355.15 million shares as of 4 p.m., down from 373.16 million on Wednesday.

“Earnings continue to be positive,” noted John Church, chief investment officer of Glenmede Trust Co. “The economy looks like it’s going toward the best case of soft landing or no landing. It’s continued growth without inflation. The Federal Reserve has done its job in keeping interest rates in line, and stock valuations aren’t too high. All of that adds up to a very powerful market.”

Some of the stocks that moved substantially Thursday:

NYSE

Boeing rose 2-1/8 to 67-1/2.

Second-quarter profit rose to 74 cents a share from 65 cents a year ago. The company also received a $2.25 billion order for 54 of its 737 jetliners from International Lease Finance Corp.

Delta Air Lines rose 1-1/8 to 80-1/2.

Fourth-quarter net income was $4.49 per share, compared with a loss of $5.50, including a special charge, a year ago. Analysts had been expecting Delta’s earnings to be about $3 per share at most.

Union Pacific rose 1-1/2 to 62-7/8.

The railroad company’s board approved an initial public offering by its Union Pacific Resources oil and gas unit of up to 17.25 percent of its outstanding common shares. After the offering, Union Pacific plans to distribute its remaining Union Pacific Resources shares on a tax-free basis to shareholders.

NASDAQ

Chipcom rose 7-1/2 to 37-1/4.

3Com Corp. fell 2-1/8 to 73-1/2.

3Com Corp., a leading seller of computers and components used in business data networks, will acquire Chipcom Corp. in a $775 million stock deal, the companies said.

AMEX

Semiconductor Packaging Materials Co. rose 1-1/8 to 13-1/4.

The company plans to offer 1.6 million common shares at $11.625 each.