Strong Earnings Reports Push Stocks Higher

Stocks rose Thursday, halting a one-day slide with help from some strong earnings reports and hopes that Friday’s economic data will provide more justification for an optimistic inflation outlook.

The Dow Jones industrial average rose 44.33 to close at 7,886.76, bolstered by strong profit showings from General Electric and J.P. Morgan.

Bellwether technology shares stumbled despite a better-than-expected profit report from Compaq Computer, but the technology-heavy Nasdaq market posted a narrow gain for its sixth consecutive record close.

The Dow’s advance put the blue-chip barometer back in striking distance of the 8,000 mark. On Wednesday, the Dow edged within 10 points of 8,000, but quickly turned lower, sliding nearly 120 points amid worries that profit forecasts have grown too optimistic.

“As we have made significant gains over the near-term, 8,000 is somewhat of a psychological barrier,” said Scott Bleier, chief investment strategist at Prime Charter. “As earnings season unfolds, we will see the Dow move through the 8,000 area. In the meantime, we’ll have this hemming and hawing as the market consolidates just south of that milestone.”

Some of the stocks that moved substantially or traded heavily Thursday:

NYSE

General Electric, up 1-1/16 at 69-1/2.

GE’s second-quarter earnings rose 13 percent, led by strong growth in its financial services division. The results were slightly better than Wall Street expectations. GE’s second-quarter revenues rose 15 percent compared with last year.

Compaq Computer, down 7/8 at 120-1/8.

The world’s biggest manufacturer of personal computers reported a 58 percent improvement in its second-quarter earnings, beating analyst forecasts.

Kmart, down 1/2 at 11.

AnnTaylor Stores, down 2 at 16-7/8.

Lowes Companies, down 3-5/16 at 35.

The retailers reported their June sales and warned that they won’t meet forecasts for their second quarter earnings.

Wal-Mart, up 1 at 35-1/16.

The nation’s biggest retailer’s sales from stores open at least a year rose 6.4 percent in June compared the same month last year, while total sales rose 11.8 percent.

NASDAQ

ValuJet, up 1/2 at 7-5/16.

Airways, up 1-1/4 at 6-5/8.

Atlanta-based ValuJet, whose public image has suffered since last year’s crash in the Florida Everglades, announced plans to buy AirTran Airways for $61.8 million in stock and drop the ValuJet name. AirTran serves 23 mid-size cities from Orlando, Fla. ValuJet is to swap one share of its stock for each AirWays share.