Stocks rebounded Wednesday as a slide in oil prices and upbeat earnings news overshadowed a sharp drop in durable goods orders that revived worries about the strength of the economy.
The Dow Jones Industrial Average closed up 47.67, or 0.5 percent, at 10,198.80 after dropping 91 points on Tuesday. The Standard & Poor's 500 Index added 4.64, or 0.4 percent, to 1,156.38. The Nasdaq Composite Index gained 2.99, or 0.2 percent, to 1,930.43.
Oil prices dropped by more than $2.50 a barrel to $51.61 after the U.S. government reported a large build up in crude oil inventories. The weekly inventory report showed a 5.5 million barrel increase in crude supplies, but a 300,000 barrel drop in gasoline supplies.
And new orders for long-lasting U.S.-made goods plunged unexpectedly by 2.8 percent in March, the biggest drop since September 2002, as orders for aircraft fell sharply, the Commerce Department said.
Dow standouts included Verizon Communications Inc., which rose $1.22 to $35.22 after topping Wall Street forecasts with a first-quarter profit of $1.76 billion on a 6.6 percent rise in revenues, and Boeing Co. gained 1 percent after it said commercial jet orders would boost future results.
Among local companies, shares of Teledyne Technologies Inc. rose 8.2 percent to close at $29.35 after the L.A.-based electronic components and instruments company reported net income of $15.8 million (46 cents per diluted share) for the first quarter ended April 3, compared with $5.9 million (18 cents) for the like period a year earlier. Revenue rose to $297.5 million from $219.6 million in the year-ago period.
On the down side, shares of OSI Systems, Inc. plummeted 14.8 percent to close at $14.46 after the Hawthorne-based maker of security and inspection systems warned it will post a third-quarter loss of $2.8 million to $3.2 million, or 17 cents to 19 cents per share, due to higher legal costs and the creation of a bad debt reserve. OSI Systems' stock was also cut to "buy" from "strong buy" by Roth Capital Partners and upgraded to "outperform" from "market perform" by Morgan Keegan.
And JAMDAT Mobile Inc. lost 3.3 percent to $17.98 after the L.A.-based wireless game publisher's stock was rated "overweight" in new coverage by Pacific Growth Equities.
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