By Anora Mahmudova and Barbara Kollmeyer, MarketWatch
NEW YORK (MarketWatch) -- The Dow Jones Industrial Average
pushed into record territory early Tuesday, but the market swung
after Fed Chairwoman Janet Yellen began her congressional
testimony.
Earlier, stocks were lifted by better-than-expected results from
J.P. Morgan Chase & Co. and Goldman Sachs Group Inc. and
generally positive economic data.
By mid-morning, the S&P 500 (SPX) was down less than a point
at 1,977.01. The Dow Jones Industrial Average (DJI) pared gains to
16 points, or 0.1%, to 17,070.25, a day after ending less than 0.1%
off its record close. The Nasdaq Composite (RIXF) slipped 11
points, or 0.2%, to 4,430.45.
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action.
"Investors are particularly interested to see proof that
earnings did bounce back in the second quarter. If we do not see
solid growth and positive outlook for the rest of the year, we
might see some repricing, as current multiples without growth are
not sustainable," said Drew Wilson, investment analyst at Fenimore
Asset Management
The early gains were also supported by broadly positive economic
reports. Empire State manufacturing activity picked up in July to
its highest reading in four years. While retail sales in June rose
less than expected, most stores except for auto dealers and
home-improvement outlets boasted an improvement in revenue. U.S.
import prices edged up less than expected.
Federal Reserve Chairwoman Janet Yellen's two-day congressional
testimony began Tuesday at 10 a.m. Eastern and is the reason behind
market swings. Read: Live blog and video of Janet Yellen's
appearance before Senate.
In earnings news, J.P. Morgan Chase(JPM) reported net income of
$1.46 a share, which included 13 cents a share in legal expenses.
Shares rose 3.5%.
Goldman Sachs(GS) reported second-quarter earnings of $4.10 a
share and revenue of $9.13 billion, beating Wall Street estimates.
Goldman shares rose 1.5%.
Johnson & Johnson (JNJ) boosted its outlook and earnings
topped forecasts. However, the stock fell 1%.
Yahoo Inc. (YHOO) and Intel Corp. (INTC) are both due to report
after the close. Read more about the day's notable movers here.
Economic data: broadly positive
* The Empire State manufacturing survey: 25.6 in July, up from
19.3 in June
* Sales at U.S. retailers rose to a seasonally adjusted 0.2% in
June, or by 0.4% excluding the auto sector.
* The prices paid for goods imported into the U.S. edged up 0.1%
in June, largely because of higher fuel costs by the smallest
amount since.
* Fed Chairwoman Janet Yellen gives testimony to Congress on the
economy and monetary policy on Tuesday and Wednesday.
Gold recovers, pound rallies
Asian markets did build on those gains, with the Nikkei 225
index settling at a more than one-week high. Gold(GCU4) was also
higher after Monday's heavy losses, gaining $6.10, while oil(CLQ4)
was pushing lower.
The German ZEW economic-sentiment reading on Tuesday fell far
short of expectations, which weighed on Europe stocks and the euro
(EURUSD). The British pound(GBPUSD) rallied after U.K. inflation
inched closer to the Bank of England's 2% target.
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