NEW YORK (Reuters) - Stocks rose on Wednesday as Alcoa's better-than-expected revenue and a positive outlook boosted investor confidence ahead of an earnings season expected to show lackluster results.
The session's rise was the first of the week after the market retreated from the S&P 500's highest point in five years, hit last Friday. Worries about a weak earnings season kept the markets down earlier in the week.
Shares of Alcoa Inc
Traders have been cautious as the current quarter was shaping up like the previous one, with companies lowering expectations in recent weeks, said James Dailey, portfolio manager of TEAM Asset Strategy Fund in Harrisburg, Pennsylvania.
"So the big question and focus is on revenue, and Alcoa had better-than-expected revenue," which calmed the market a little, Dailey said.
Overall, corporate profits were expected to beat the previous quarter's meager 0.1 percent rise. Both earnings and revenues in the fourth quarter were expected to grow by 1.9 percent, according to Thomson Reuters data.
The lowered expectations also leave room for companies to surprise investors even if their results are not particularly strong, analysts said.
The Dow Jones industrial average <.DJI> gained 59.47 points, or 0.45 percent, at 13,388.32. The Standard & Poor's 500 Index <.SPX> rose 3.86 points, or 0.26 percent, at 1,461.01. The Nasdaq Composite Index <.IXIC> was up 14.93 points, or 0.48 percent, at 3,106.74.
Apollo Group Inc
(Reporting by Gabriel Debenedetti; additional reporting by Angela Moon; Editing by Nick Zieminski)
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