Dow, S&P 500 hit record highs on earnings, Fed

The Dow and the S&P 500 closed at new record highs Thursday on robust corporate earnings reports and the latest reaffirmation of the Federal Reserve\'s easy-money policy. The Dow Jones Industrial Average rose 78.02 (0.50 percent) to 15,548.54. The broad-market S&P 500 ended 8.46 (0.50 percent) higher at 1,689.37. The rally solidly topped both indices\' prior closing records set Monday of 15,484.26 on the blue-chip Dow and 1,682.50 on the S&P 500. The tech-rich Nasdaq Composite Index, meanwhile, eked out a gain of 1.28 (0.04 percent) to 3,611.28 after some disappointing earnings reports, including from Dow member Intel. The new records followed a second day of congressional testimony from Federal Reserve Ben Bernanke that came and went with no bombshells. Bernanke reiterated that the Fed plans to scale back its bond-buying program, but only when the economy improves. More companies have exceeded earnings expectations than lagged them. S&P Capital IQ now expects second-quarter earnings for the S&P 500 to rise by an average of 3.88 percent compared with Friday\'s estimate of 3.19 percent. \"We are seeing earnings creep higher as the reporting period proceeds,\" said Sam Stovall, chief investment strategist at S&P Capital IQ Dow component UnitedHealth Group shot up 6.5 percent after profits were $1.40 per share compared with projections of $1.25. Boeing, another Dow member, put on 2.7 percent after a British safety agency, investigating a fire aboard a parked 787 Dreamliner, focused primarily on a transmitter system and not on the electrical system of Boeing\'s new plane. Two large banks in the Dow, Bank of America and JPMorgan Chase, rose by 3.1 percent and 2.0 percent, respectively, after peer Morgan Stanley became the latest big financial company to beat earnings estimates by a large margin. Morgan Stanley leaped 4.4 percent. But chip-maker Intel sank 3.8 percent as declining personal computers demand trimmed profits by 29 percent. Other Dow decliners included Verizon (down 1.5 percent) and American Express (down 3.6 percent). Dell jumped 1.9 percent after postponing a shareholders vote on a go-private proposal in the face of criticism. Sherwin-Williams plummeted 8.3 percent after revenue and net income lagged expectations. The paint manufacturer also announced that Mexican competition authorities had opposed a proposed $2.3 billion acquisition of Mexican paint and coatings company Consorcio Comex. Bond prices tumbled. The yield on the 10-year Treasury bond rose to 2.53 percent from 2.49 percent late Wednesday, while the 30-year jumped to 3.63 percent from 3.57 percent. Bond prices and yields move inversely.