April 20 - Wall Street closed the day in different directions as earnings from bellwethers General Electric and McDonald’s lifted the Dow and S&P 500. Conway G. Gittens reports.
PLEASE NOTE: THIS EDIT CONTAINS CONVERTED 4:3 MATERIAL Wall Street put together its third rally in five days as earnings gave investor confidence a shot in the arm. First-quarter profits, excluding items, topped forecasts at General Electric and revenues came in ahead of expectations at more than $35 billion. Industrial orders rose 20 percent and pricing was firm, leading CEO Jeff Immelt to maintain his 2012 forecast of double-digit growth. Profits at McDonald's are up. The growing popularity of its low-cost menu around the world, especially in economically-challenged Europe, resulted in strong sales numbers for the world's biggest fast food chain. Russ Koesterich, the chief global strategist at iShares, a division of BlackRock, sums up a low-expectation earnings season this way: SOUNDBITE: RUSS KOESTERICH, CHIEF GLOBAL STRATEGIST, ISHARES (ENGLISH) SAYING: "Economic growth is just enough to produce some decent top-line numbers, but what is also happening is because the economy is slow and interest rates are low and people can't get a raise we're seeing that the two biggest input costs for those companies, wages and the cost of capital, are barely growing. And that's helping companies maintain record margins." In other corporate news: It's been two years since a drilling explosion in the Gulf of Mexico killed 11 workers, causing the biggest oil spill in U.S. history. Just this week BP reached settlements to resolve billions of dollars in claims tied to the disaster, but legal troubles remain. Back to the markets now: The Dow and S&P 500 finished higher, but the Nasdaq stumbled. Blue chips gained 1.4 percent for the week, while the Nasdaq is down three in a row. Europe closed out its best week in a month with a rally encouraged by upbeat economic data. Conway Gittens, Reuters