* Morgan Stanley's stock soars after strong results
* Shares of eBay, Intel fall after disappointing forecasts
* Bernanke soothes markets again in congressional testimony
* Dow up 0.5 pct, S&P 500 up 0.5 pct, Nasdaq up 0.1 pct
By Caroline Valetkevitch
NEW YORK, July 18 The Dow and the S&P 500 rose
to all-time intraday highs on Thursday as Morgan Stanley and
others reported better-than-expected earnings and Federal
Reserve Chairman Ben Bernanke's comments further reassured
Shares of Morgan Stanley jumped 4.6 percent to $27.76
after the bank posted a 42 percent increase in quarterly profit
as stock trading revenue soared. The S&P financial index
climbed 1.3 percent.
A rally in the shares of UnitedHealth helped lift
the Dow and other health insurers' stocks. UnitedHealth gained
6.6 percent to $70.63 after the company's results beat
expectations, while the Morgan Stanley healthcare payor index
rose 3 percent.
The news helped both the Dow and the S&P 500 hit new
intraday highs shortly after the opening bell. The Dow climbed
as high as 15,589.40, while the S&P 500 touched a session high
Analysts' estimates for corporate earnings have been lowered
so much that investors believe the low targets should be easily
exceeded. Instead, investors will likely hone in on revenue
figures and outlooks.
"I've been encouraged by the financial sector in general,"
said Joe Bell, senior equity analyst with Schaeffer's Investment
Research, in Cincinnati. "Financials have had a lot of strong
positive reactions and reports."
Of the 21 financial companies that have reported quarterly
earnings so far, 76 percent have surpassed estimates, Thomson
Reuters data showed.
The Dow Jones industrial average was up 78.71 points,
or 0.51 percent, at 15,549.23. The Standard & Poor's 500 Index
was up 9.09 points, or 0.54 percent, at 1,690.00. The
Nasdaq Composite Index was up 3.99 points, or 0.11
percent, at 3,613.99.
With the benchmark S&P 500 up 18.6 percent for the year,
investors are watching for any signs of how soon the Federal
Reserve will start to wind down the pace of its $85 billion a
month in bond purchases. The Fed's stimulus program has helped
drive the U.S. stock market's rally this year.
Speaking before the House Financial Services Committee on
Wednesday, Bernanke stressed that the timeline for winding down
the Fed's stimulus program was not set in stone.
On Thursday, Bernanke delivered the same message to the
Senate Banking Committee. He said economic data since the Fed's
June meeting has been mixed, adding that "it's way too early to
make any judgment" about the impact for the central bank's
IBM raised its full-year outlook and reported
earnings that beat estimates, though the company missed
forecasts on revenue. Shares of International Business Machines
rose 1.9 percent to $198.24. IBM gave one of the biggest lifts
to the S&P 500 and helped offset losses by Intel and
Intel, which also limited the Nasdaq gains, slid 3.7 percent
at $23.25 after the world's biggest chipmaker cut its full-year
revenue forecast, while eBay fell 6.8 percent to $53.47 after it
said full-year results would be at the low end of its forecast
Analysts expect S&P 500 companies' second-quarter earnings
to have grown 3.5 percent from a year earlier, with revenue up
1.1 percent, according to Thomson Reuters data.
A meeting of Dell shareholders to vote on founder
Michael Dell's $24.4 billion offer to take the company private
was adjourned to next week. Dell's stock rose 1.9 percent to
Shares of Google, expected to report earnings after
the bell, slipped 0.8 percent at $911.40. Shares of Microsoft
, also set to release results after the close, tumbled
1.2 percent to $35.32. Microsoft was among the Nasdaq's most
actively traded stocks.