Investors pushed back into the stock market a day after a slide as earnings reports boosted confidence about the pace of a recovery in the economy.
Reports from The Walt Disney Co. as well as retailers Abercrombie & Fitch Co. and J.C. Penney Co. offset worries Friday about a disappointing consumer confidence report and an increase in the nation's trade deficit that was bigger than forecast.
Disney said late Thursday that improved revenue at its cable, broadcast and movie studio units helped produce an 18 percent increase in its fiscal fourth-quarter profit.
Abercrombie's results were better than expected, while J.C. Penney raised its profit and sales forecasts.
The news helped investors set aside some worry about an 18.2 percent increase in the trade deficit in September. The $36.5 billion deficit was the largest since January and more than the $31.7 billion imbalance economists had expected.
The wider deficit was driven by a big rise in imports, led by a jump in oil shipments. That overwhelmed a fifth consecutive increase in exports. Exports are expected to continue to rise as the dollar continues to weaken, which makes U.S. exports less expensive to overseas buyers.
The market briefly stumbled after consumer confidence fell. The preliminary Reuters/University of Michigan consumer sentiment index for November came in at 66.0, down from 70.6 in October. That made investors nervous that cautious consumers wouldn't step up spending at the holidays.
Meanwhile, the dollar resumed to slump against other currencies. The dollar's steady decline since March, due largely to record-low U.S. interest rates, has encouraged investors to move money out of dollars and into higher-yielding assets like stocks and commodities.
Doug Roberts, chief investment strategist at ChannelCapitalResearch.com, said investors are cautious about putting more money in stocks after the steep gains in the past eight months.
"The market is trying to figure out where it wants to go," he said.
In midday trading, the Dow Jones industrial average rose 77.08, or 0.8 percent, to 10,274.55. The Dow fell 93 points Thursday, breaking a six-day winning streak, as oil prices tumbled on fresh signs of weak energy demand and a stronger dollar.
The broader Standard & Poor's 500 index rose 6.17, or 0.6 percent, to 1,093.41. The Nasdaq composite index rose 11.60, or 0.5 percent, to 2,160.62.
The ICE Futures US dollar index, which measures the dollar against other currencies, fell 0.4 percent after rising the past two days.
Gold rose, while oil fell 44 cents to $76.50 a barrel on the New York Mercantile Exchange.
Disney Co. rose $1.04, or 3.6 percent, to $30.09 after posting its results.
Abercrombie said its third-quarter profit fell 39 percent on an ongoing slump in sales. But results from the teen retailer were better than analysts had expected. It rose $2.73, or 7.4 percent, to $39.49.
J.C. Penney said its net income dropped 78 percent during the third quarter on a big pension-related expense. Sales at stores open at least a year, a key gauge for retailers, slid 4.6 percent. But the company boosted its profit and sales outlook. It gained $2.02, or 6.9 percent, to $31.41.
Bonds were mixed. The yield on the 10-year note, which moves opposite its price, slipped to 3.44 percent from 3.45 percent late Thursday. The government wrapped up $81 billion in bond auctions for the week on Thursday.
Two stocks rose for every one that fell on the
New York Stock Exchange, where volume came to 373.3 million shares compared with 394.7 million shares traded at the same point Thursday.
The Russell 2000 index of smaller companies rose 1.83, or 0.3 percent, to 582.15.
Overseas, Japan's Nikkei stock average slipped 0.4 percent. In afternoon trading, Britain's FTSE 100 rose 0.4 percent, Germany's DAX index advanced 0.4 percent, and France's CAC-40 lost 0.1 percent.
