25 Apr 2009

Earnings reports help lift Wall St stocks

9:33 am on 25 April 2009

US stocks rallied on Friday as earnings showed companies have weathered the recession and economic data raised hopes the economic cycle may have hit a bottom.

Investors were also undeterred by a government release of a much anticipated concept paper on stress tests for the 19 biggest US financial services companies.

American Express shot up nearly 21% to $US25.30 a day after reporting results that topped analysts' expectations, helped by aggressive cost cutting.

Ford Motor Co also posted a smaller-than-expected first-quarter loss and said it was on track to at least break even in 2011 and did not expect to seek US government loans, sending its shares up 11.4% to $US5.

Economic data also fed the buying frenzy after durable goods orders slipped in March, but fell far less than Wall Street expected. Sales of new single-family homes dropped, but inventories plummeted at a record pace.

The Dow Jones industrial average added 119.23 points, or 1.50%, to 8,076.29.

The Standard & Poor's 500 Index rose 14.31 points, or 1.68%, to 866.23.