Stocks opened narrowly higher Wednesday as traders digested a mixed bag of earnings reports.
Disturbing the market was a $11.69-per-share loss for troubled bond insurer Ambac Financial Group (ABK). Net premiums written fell 38%, and credit derivative exposures added up to a $1.7 billion loss.
Boeing (BA), Yahoo (YHOO) and United Parcel Service (UPS) also posted earnings results from the first quarter.
Meanwhile, Standard & Poor's Investment Policy Committee says it "believes that from economic, fundamental, technical and historical perspectives, the worst of the recent equity price decline is likely over." The U.S. will be in recession from December 2007 to July 2008, but "the U.S. economy will begin to benefit from the spending of the tax rebate checks" early this summer, S&P says.
In early trading on Wednesday, the Dow Jones industrial average was up 29.55 points, or 0.23%, to 12,749.78. The broader S&P 500 gained 4.04 points, or 0.29%, to 1,379.98. The tech-heavy Nasdaq composite index was up 13.56 points, or 0.57%, to 2,390.50.
On Tuesday, the Dow fell 104.79 points, or 0.82%, to 12,720.23, while the S&P 500 lost 12.23 points, or 0.88%, to 1,375.94. The Nasdaq composite dropped 31.1 points, or 1.29%, to 2,376.94.
On the NYMEX, oil prices were falling on Wednesday. June crude oil was down 90 cents to trade at $117.17 per barrel.
Among stocks in the news, Boeing (BA) posted earnings of $1.62 per share, vs. $1.13 a year ago, as revenue rose 4.1%. It expects earnings of $5.70 to $5.85 per share in 2008, and $6.80 to $7 per share in 2009.
Yahoo (YHOO) reported earnings of 11 cents per share, vs. 11 cents a year ago, as revenue was 8.7% higher. Microsoft (MSFT) chief executive Steve Ballmer reportedly said Yahoo's results won't be enough to raise Microsoft's $44-billion takeover offer for Yahoo.
UPS (UPS), the largest shipping company in the world, posted earnings of 87 cents per share, vs. 78 cents a year ago. That largely met investor expectations, but UPS executives warned they see no sign of an economic recovery in the U.S. in the second quarter.
Schering-Plough (SGP) posted earnings of 15 cents per share, vs. 36 cents a year ago.
Philip Morris International (PM) posted earnings of 89 cents, vs. 69 cents, as revenue rose 18%. The firm raised its 2008 earnings forecast by 8 cents per share. Philip Morris said it will acquire Interval and other trademarks from the Imperial Tobacco Group for 254 million euros.
Safeco (SAF) agreed to be acquired by Liberty Mutual Group in a $6.2 billion deal.
MetLife (MET) says its board authorized another $1 billion in stock buybacks. About $261 million remains of a previous, $1-billion stock repurchase program announced in January.
Major European indexes were mixed on Wednesday. In London, the FTSE 100 index fell 0.36% to 6,013. Paris' CAC 40 index added 0.4% to 4,892.10, and Germany's DAX index fell 0.28% to 6,709.49.
In Asia, Japan's Nikkei 225 was up 0.23% to 13,579.16, while Hong Kong's Hang Seng index gained 1.4% to 25,289.24.
Treasury market
Treasury prices were falling on Wednesday. The two-year Treasury notes were off 01/32 to 99-03/32 for a yield of 2.236%; 10-year Treasuries fell 06/32 to 98-07/32 for a yield of 3.724%; and the 30-year bond was off 09/32 to 98-16/32 for a yield of 4.470%.