Stocks edge up, led by banks, as earnings reports come in mixed

Stocks on Wall Street edged up Tuesday, erasing the market’s modest losses from a day earlier.

The gains, which followed a rally in overseas stock indexes, came as investors sized up company earnings reports.

Financial stocks led the way higher as bond yields rose. Rising bond yields drive up interest rates, which enables banks to make more money on loans. BlackRock and Progressive led the financial sector after reporting solid quarterly results.

Qualcomm powered technology-sector stocks higher, notching its best day in nearly 20 years, on news that it and Apple settled their bitter legal dispute.

Investors are looking to the latest wave of corporate earnings reports — due out over the next few weeks — for clues about the health of the global economy and the prospects for company profits this year.

Analysts expect first-quarter results for companies in the Standard & Poor’s 500 index overall to be the weakest in nearly three years.

“The markets are prepared for this year-over-year decline that everyone is expecting in earnings,” said Erik Davidson, chief investment officer at Wells Fargo Private Bank. “Unless we have some significant misses, we should be doing OK.”

The S&P 500 edged up 1.48 points, or 0.1%, to 2,907.06. The Dow Jones industrial average rose 67.89 points, or 0.3%, to 26,452.66. The Nasdaq composite rose 24.21 points, or 0.3%, to 8,000.23 — its first close above 8,000 points since October.

The Russell 2000 index of small-cap stocks advanced 3.62 points, or 0.2%, to 1,582.79.

Overseas stock indexes rallied on upbeat economic data from China and Germany. Markets in Asia and Europe finished higher.

U.S. stocks have had a torrid start to the year after the Federal Reserve said it may not raise interest rates at all in 2019. The benchmark S&P 500 remains within 0.8% of its all-time high, which it reached Sept. 20.

“Investors should take some comfort, because we have over those six months seen some pretty significant earnings growth and we’re likely to continue to see it,” Davidson said.

What investors take away from the slew of company earnings reports will likely be a key driver of the market’s move from here.

Analysts expect companies in the S&P 500 to report a 2.9% drop in earnings per share for the first quarter versus a year earlier, which would be the first decline since spring 2016. The expected decline is due almost entirely to weaker profit margins.

Companies that posted encouraging results helped put traders in a buying mood Tuesday.

Progressive shares jumped 6.9% after the insurer posted quarterly results that topped analysts’ forecasts. BlackRock shares gained 3.2% after the investment firm reported profit that surged past Wall Street forecasts as a rebounding market helped increase assets.

Bank of America inched up 0.1% after the nation’s second-largest bank reported strong earnings growth but gave a weak forecast for net interest income, a key performance metric for banks.

UnitedHealth Group, the nation’s largest health insurance company, reported first-quarter results that beat analysts’ expectations and raised its estimates for the full year. But cautious comments from management during a conference call with analysts weighed on the stock, which slumped 4%.

Other health insurers’ stocks also fell. HCA Healthcare sank 10%. Cigna slid 7.8% and Anthem lost 6.8%.

Johnson & Johnson bucked the broader declines in the healthcare sector. The world’s biggest maker of healthcare products saw its stock rise 1.1% after its results topped Wall Street’s forecasts, even though its profit slumped 14% following a decline in sales overseas and higher costs for research and litigation.

JB Hunt Transport Services fell 4.9% after the trucking and logistics company’s profit and revenue fell short of analysts’ expectations.

Qualcomm shares surged 23.2% after the chipmaker and Apple settled their bitter financial dispute centered on some of the technology that enables iPhones to connect to the internet.

Scientific Games climbed 8% on news that the maker of betting machines and technology is partnering with Wynn Resorts to help develop digital sports betting and gambling. Wynn rose 2%.

The yield on the 10-year Treasury note rose to 2.59% from 2.55%. That yield yield has been climbing since late last month, when it fell to 2.37% amid a crescendo of worries that global economic growth was slowing.

Energy futures finished mostly higher. Benchmark U.S. crude oil rose 1% to settle at $64.05 a barrel. Brent crude, the international standard, rose 0.8% to $71.72 a barrel.

Wholesale gasoline rose 1% to $2.03 a gallon. Heating oil rose 1% to $2.08 a gallon. Natural gas fell 0.7% to $2.57 per 1,000 cubic feet.

Gold fell 1.1% to $1,277.20 an ounce. Silver fell 0.4% to $14.92 an ounce. Copper fell 0.2% to $2.93 a pound.

The dollar fell to 111.99 yen from 112.03 yen. The euro weakened to $1.1288 from $1.1304.