Created on Thursday, 25 July 2013 Written by MATTHEW CRAFT,AP Business Writer
NEW YORK (AP) — Disappointing results from PulteGroup, D.R. Horton and other home builders left major stock indexes with only tiny gains in midday trading. Technology stocks rose after Facebook soared past analysts' earnings estimates.
Even with plenty of earnings news from big companies, the broader market was mixed. Of the 10 industry groups in the Standard & Poor's 500 index, five rose and five fell.
D.R. Horton, the country's largest builder, and PulteGroup said orders for new houses jumped in the second quarter, but their results still fell short of what analysts had expected. PulteGroup also posted a 14 percent decline in profits
D.R. Horton dropped $1.77, or 8 percent, to $19.45. PulteGroup lost $1.95, or 11 percent, to $16.49.
Technology companies fared better. Facebook jumped 27 percent after reporting earnings late Wednesday that easily beat analysts' forecasts thanks to higher revenue from advertisements on mobile devices. Facebook's stock rose $7.16 to $33.68.
The Standard & Poor's 500 index was up two points, or 0.1 percent, to 1,688 as of 12:53 p.m.
The Dow Jones industrial average rose two points, or 0.01 percent, at 15,543. The Dow was held back by Caterpillar, which warned of sagging sales on Wednesday.
The Nasdaq composite index rose 17 points, or 0.5 percent, to 3,596.
It's still early in the second-quarter earnings season, yet the overall trend looks good, said Tyler Vernon, chief investment officer of Biltmore Capital in Princeton, NJ. "There have been some big disappointments, like Caterpillar yesterday, but we're seeing better and better numbers coming out."
Analysts forecast that companies in the S&P 500 index will report earnings growth of 4.3 percent over the same period last year, according to S&P Capital IQ. At the start of July, the forecast was for growth of 2.8 percent. More than six out of every 10 companies have cleared analysts' earnings targets so far.
Eventually, improving profits should help push the S&P 500 index above 1,700 in the coming weeks, Vernon said.
In the market for U.S. government bonds, the yield on the 10-year Treasury note climbed to 2.62 percent from 2.59 percent the day before. Late last week, it was trading at 2.48 percent. One concern among investors is that a sharp increase in the rate would drive up mortgage costs and slow down sales in the housing market.
The 10-year yield acts as a benchmark for most mortgage loans. It's still very low by historical standards thanks in large part to the Federal Reserve's massive bond-buying program. The yield hit a recent low of 1.63 percent on May 3. By contrast, it was trading around 4 percent in the summer of 2008, shortly before the worst days of the financial crisis.
Among other stocks making big moves:
— Las Vegas Sands, a major casino operator, fell $1.25, or 2.3 percent, to $53.69 after it posted lower revenue and income than financial analysts had expected.
— Harley-Davidson rose 40 cents, or 1 percent, to $56.27 following news that the Milwaukee-based motorcycle maker's earnings rose 10 percent in the second quarter, driven by an aggressive expansion abroad and revamped production.
— Visa rose $8.06, or 4 percent, to $194.78. Visa returned to profitability in its third fiscal quarter and reported strong revenue growth as the company processed more transactions worldwide.