NEW YORK — Investors encouraged by a good batch of earnings reports and forecasts jumped back into stocks Thursday after a two-day slide.
Stocks posted big gains as investors snapped up financial shares after several banks said they weren’t seeing as many loans go bad. The market extended its gains in afternoon trading when Wal-Mart said it expects sales to grow this year and increase at a faster pace next year.
The Dow Jones industrial average jumped 132 points and logged the biggest gains of major indexes after Wal- Mart’s forecast and as several companies included in the index reported earnings that beat expectations.
The technology-heavy Nasdaq composite index advanced the least among major indicators following a disappointing forecast from online retailer eBay.
Tech stocks could get a lift today following Amazon’s report that its third- quarter earnings jumped 62 percent. The online retailer brought in more revenue than expected and said it expects sales will continue to grow. The company’s report arrived after markets closed, and its shares jumped 12 percent in late trading after ticking up only 3 cents during the day.
Consumer stocks rose after Wal-Mart said it expects sales to increase 1 to 2 percent for the current fiscal year and 4 to 6 percent for next year. The nation’s largest retailer also said it would focus on emerging markets when opening stores. Meanwhile, clothing retailer J. Crew Group raised its earnings forecast because of stronger sales and profit margins.
The Dow rose 131.95, or 1.3 percent, to 10,081.31. The index is 11 points below its highest close of the year, which it reached Monday.
The broader Standard & Poor’s 500 rose 11.51, or 1.1 percent, to 1,092.91. The Nasdaq rose 14.56, or 0.7 percent, to 2,165.29.
Two stocks rose for every one that fell on the New York Stock Exchange, where volume came to 1.3 billion shares compared with 1.4 billion Wednesday.
Separately, a private forecast of economic activity rose for the sixth straight month in September. The Conference Board’s index of leading economic indicators rose 1 percent last month after a 0.4 percent gain in August.
Jeffrey Beamer, Portfolio Manager of Lacerte Capital in Dallas, said earnings reports showing improved profits, but still-weak revenues raise questions about whether the market can hold its gains. Cost-cutting, he noted, can only help so much.
“You may look great this quarter, but what are you going to do in the coming quarters,” Beamer said. “If the earnings aren’t just really solid, we could get a decent pullback here.”
