NEW YORK (Reuters) – The Dow and S&P 500 advanced for a second day on Tuesday as stronger-than-expected consumer confidence data and hopes for further progress on a solution to Europe's fiscal mess bolstered sentiment.

However, in a sign investors are still nervous about the European debt crisis, defensive sectors such as utilities and consumer staples were among the best performers. The Nasdaq composite index also closed lower.

Helping to lift the mood on Wall Street, the Conference Board, an industry group, said its index of consumer confidence jumped to its highest level since July, handily topping economists' forecasts.

Financial shares limited the advance, with the S&P financial index (.GSPF) down 0.6 percent. Shares of Bank of America (BAC.N) dropped 3.2 percent to $5.08, its lowest closing level since March 2009.

Bank shares have been battered by worries that the impact of the euro zone crisis could spread through the global financial system and their losses highlight the fragility of any stocks rally until European Union policymakers resolve it once and for all.

"There seems to be some movement on the European front, but things certainly haven't been resolved. Financials are taking a step back, and are kind of keeping a cap on the market as a whole," said Thomas Villalta, portfolio manager for Jones Villalta Asset Management in Austin, Texas.

The Dow Jones industrial average (.DJI) was up 32.62 points, or 0.28 percent, at 11,555.63. The Standard & Poor's 500 Index (.SPX) was up 2.64 points, or 0.22 percent, at 1,195.19. The Nasdaq composite index (.IXIC) was down 11.83 points, or 0.47 percent, at 2,515.51.

In a positive sign for the euro zone, Italian bond yields fell from session highs. In the auction, Italy's government sold 7.5 billion euros of three- and 10-year bonds, close to the upper end of its target range.

Investors also eyed a meeting of European officials in hopes they will make progress in resolving the region's debt crisis.

The day's most actively traded stock on the New York Stock Exchange was AMR Corp (AMR.N), even though it was halted 28 times throughout the day. It plunged 84 percent to 26 cents a share after the company, parent of American Airlines, filed for bankruptcy protection and named a new chairman and chief executive.

After the market's close, Standard & Poor's reduced its credit ratings on several big banks in the United States and Europe, including JPMorgan Chase & Co (JPM.N) and Bank of America.

S&P said the actions were the result of a sweeping overhaul of its ratings criteria. The affected banks could see higher funding costs, a fixed income strategist said.

On Monday, U.S. stocks rebounded sharply from seven days of losses, with the S&P closing up nearly 3 percent.

Weakness in some large-cap Internet stocks weighed on the Nasdaq after strong gains in those stocks on Monday. Amazon.com (AMZN.O) dropped 3 percent to $183.39.

The confidence data followed record Black Friday sales, giving investors hope that the holiday shopping season will be a solid one for retailers.

Some 6.73 billion shares changed hands during the day on U.S. exchanges, below the daily average of 7.96 billion shares.

Decliners beat advancers on the NYSE by 15 to 14 and on the Nasdaq by about 5 to 3.

(Reporting by Caroline Valetkevitch; Editing by Kenneth Barry)

NEW YORK (Reuters) – The Dow and S&P 500 advanced for a second day on Tuesday as stronger-than-expected consumer confidence data and hopes for further progress on a solution to Europe's fiscal mess bolstered sentiment.

However, in a sign investors are still nervous about the European debt crisis, defensive sectors such as utilities and consumer staples were among the best performers. The Nasdaq composite index also closed lower.

Helping to lift the mood on Wall Street, the Conference Board, an industry group, said its index of consumer confidence jumped to its highest level since July, handily topping economists' forecasts.

Financial shares limited the advance, with the S&P financial index (.GSPF) down 0.6 percent. Shares of Bank of America (BAC.N) dropped 3.2 percent to $5.08, its lowest closing level since March 2009.

Bank shares have been battered by worries that the impact of the euro zone crisis could spread through the global financial system and their losses highlight the fragility of any stocks rally until European Union policymakers resolve it once and for all.

"There seems to be some movement on the European front, but things certainly haven't been resolved. Financials are taking a step back, and are kind of keeping a cap on the market as a whole," said Thomas Villalta, portfolio manager for Jones Villalta Asset Management in Austin, Texas.

The Dow Jones industrial average (.DJI) was up 32.62 points, or 0.28 percent, at 11,555.63. The Standard & Poor's 500 Index (.SPX) was up 2.64 points, or 0.22 percent, at 1,195.19. The Nasdaq composite index (.IXIC) was down 11.83 points, or 0.47 percent, at 2,515.51.

In a positive sign for the euro zone, Italian bond yields fell from session highs. In the auction, Italy's government sold 7.5 billion euros of three- and 10-year bonds, close to the upper end of its target range.

Investors also eyed a meeting of European officials in hopes they will make progress in resolving the region's debt crisis.

The day's most actively traded stock on the New York Stock Exchange was AMR Corp (AMR.N), even though it was halted more than a dozen times throughout the day. It plunged 84 percent to 26 cents a share after the company, parent of American Airlines, filed for bankruptcy protection and named a new chairman and chief executive.

On Monday, U.S. stocks rebounded sharply from seven days of losses, with the S&P closing up nearly 3 percent.

Weakness in some large-cap Internet stocks weighed on the Nasdaq after strong gains in those stocks on Monday. Amazon.com (AMZN.O) dropped 3 percent to $183.39.

The confidence data followed record Black Friday sales, giving investors hope that the holiday shopping season will be a solid one for retailers.

Some 6.72 billion shares changed hands during the day on U.S. exchanges, below the daily average of 7.96 billion shares.

Decliners beat advancers on the NYSE by 15 to 14 and on the Nasdaq by about 5 to 3.

(Reporting by Caroline Valetkevitch; Editing by Kenneth Barry)

NEW YORK (Reuters) – Stocks jumped on Monday as optimism grew that European leaders would come up with a new plan to resolve the region's debt crisis and following a strong start to the U.S. holiday shopping season.

All 10 S&P sectors were up sharply, but energy and consumer discretionaries were among those with the biggest gains.

Retail stocks rose after upbeat reports on the start of the holiday shopping season over the weekend. Shares of Macy's (M.N) jumped 5.3 percent to $31.01.

Weak consumer spending has been a worry for investors, and the holiday period would likely confirm whether there's been any improvement in that area.

On the European front, efforts heated up to ease Europe's sovereign debt crisis, which contributed to the benchmark S&P index's recent seven-day string of losses.

Germany and France pushed to acquire powers to reject national budgets in the euro zone that breach European Union rules ahead of an EU summit on December 9.

Also, an Italian newspaper report suggested the International Monetary Fund was preparing a rescue plan for Italy, but the IMF denied the report.

"The rumors … have emboldened risk-takers to cover shorts. Unfortunately, these rallies are short-lived until real dollars or euros are injected into the financial systems," said Chad Morganlander, portfolio manager at Stifel, Nicolaus & Co in Florham Park, New Jersey.

The Dow Jones industrial average (.DJI) was up 284.50 points, or 2.53 percent, at 11,516.28. The Standard & Poor's 500 Index (.SPX) was up 32.63 points, or 2.82 percent, at 1,191.30. The Nasdaq Composite Index (.IXIC) was up 81.61 points, or 3.34 percent, at 2,523.12.

Morganlander said the day's gains could be just a quick rise after recent losses. Wall Street just had its worst week in two months.

The S&P retail index (.RLX) advanced 3.2 percent while Best Buy Co Inc (BBY.N) added 3.7 percent to $26.58.

(Reporting by Caroline Valetkevitch; additional reporting by Ryan Vlastelica; Editing by Kenneth Barry)

NEW YORK – Stocks wavered between slight gains and losses Tuesday after consumer confidence dropped to the lowest level since April 2009. Trading volume was much lighter than usual because many investors are on vacation.

The drop in the Conference Board’s Consumer Confidence Index was far worse than analysts expected, leaving the index at only half of the level consistent with a healthy economy. The index plunged 15 points to 44.5 in August, well below the estimate of 53.3 from economists surveyed by FactSet. The index is usually at 90 or above when the economy is strong.

The sharp fall in the measure of how U.S. consumers feel about the economy could mean weaker sales for retailers and makers of consumer goods like clothes and shoes. Retailers are in the midst of the critical back-to-school shopping season, which can account for as much as 25 percent of their annual revenue.

The Dow Jones industrial average was down 14 points, or 0.1 percent, to 11,524 at 1:45 p.m.

“Investors are swinging back to caution,” said Randy Bateman, chief investment officer and president of Huntington Asset Advisors. “There’s some reality that’s setting in that we’re not out of the woods yet on this economy.”

Companies that rely most heavily on consumer spending fell more than the broader market. Retailers Kohl’s Corp. and Lowe’s Cos. each fell 2 percent. Nike Inc. fell 1.9 percent.

Boeing Co. rose 1.5 percent, the most of any company in the Dow, after the aircraft maker said it received approval from its board to build a version of its workhorse 737 jet with a redesigned engine. That should help it compete better with rival Airbus.

The Standard & Poor’s 500 fell 4 points, or 0.3 percent, to 1,206. The Nasdaq composite index rose 2, or 0.1 percent, to 2,564.

Trading volume, or the number of shares bought and sold, was shaping up to be the lowest this year. About 2.1 billion shares exchanged hands on the New York Stock Exchange, the lowest since Dec. 31, 2010.

Low volume is worrisome because it suggests that few investors are driving the stock market’s gains or losses. That creates the risk for bigger price swings, said Stephen Carl, principal and head of equity trading at The Williams Capital Group. A lack of volume also indicates that some investors don’t believe that stocks are worth buying right now.

Stocks have swung widely in August. The Dow was down as much as 7.4 percent for the year on Aug. 10, but it is now down just 0.5 percent. On Monday, the Dow soared 254 points, its fourth-largest gain this year. Insurers rose the most after it became clear the damage from Tropical Storm Irene wasn’t nearly as bad as analysts had feared.

The Standard & Poor’s 500 index hit a 2011 low Aug. 8 after the U.S. government’s credit rating was downgraded for the first time. Since then, it has risen 7.7 percent.

Bond prices have been just as volatile. The yield on the 10-year Treasury note briefly fell to a record low below 2 percent on Aug. 18 on weak manufacturing data from the Philadelphia Federal Reserve. On Tuesday, the yield fell to 2.18 percent, down from 2.27 percent late Monday.

NEW YORK – Stocks are falling after consumer confidence dropped in August to its lowest level since April 2009.

The Conference Board, a private research group, said Tuesday that its Consumer Confidence Index fell 15 points to 44.5. That was far lower than economists had predicted.

Wild swings in the stock market this month have put consumers on edge. That’s a worrisome sign for the economy and for retailers, who depend on the back-to-school shopping season for as much as 25 percent of their annual revenue.

Shortly after 10 a.m., the Dow Jones industrial average is down 102 points, or 0.9 percent, at 11,437. The Standard & Poor’s 500 is down 13, or 1.1 percent, at 1,196. The Nasdaq is down 26, or 1 percent, at 2,535.

CONFIDENCE BOOST: A decline in gas prices this month helped Americans feel more confident about the economy. The Thomson Reuters/University of Michigan Consumer Sentiment index came in above analysts’ estimates.

HIGHER INCOME: The Commerce Department reported that personal income and spending each rose 0.4 percent in April, another hopeful sign that consumers might become more willing to buy more.

DOWN WEEK: Major indexes are still down slightly for the week, extending their weekly losses to four. The Dow is off 0.6 percent, and the S&P 500 and Nasdaq are both down 0.2 percent.

NEW YORK – Maybe American consumers are better off than anyone thought.

An unexpected jump in consumer confidence and slight gains in Americans’ spending and income helped push stocks higher for the third day in a row Friday.

The Thomson Reuters/University of Michigan Consumer Sentiment index rose to 74.3 in May, above analysts’ estimates of 70. Concerns about higher gas prices and inflation knocked the gauge down in March and April.

Gas prices have come down in May after reaching nearly $4 last month, giving a lift to the closely watched measure of consumer confidence.

“That’s what a 25-cent drop in gas prices will do,” David Ader, bond strategist at CRT Capital Group, wrote in an email to clients.

That dip isn’t accounted for in the latest consumer spending figures from the Commerce Department, because its numbers lag by a month. Both personal income and spending rose 0.4 percent in April, in line with what economists expected. Higher prices for food and gas made up most of the increase in consumer spending, which practically ate up the income gains.

The Dow Jones industrial average rose 62 points, or 0.5 percent, to 12,464. The Standard & Poor’s 500 index rose 6 points, or 0.5 percent, to 1,332. The Nasdaq composite rose 15 points, or 0.5 percent, to 2,797.

Marvell Technology Group Ltd. jumped 10 percent. The maker of chips for data-storage and Blackberry’s smartphones reported a slight drop in earnings. But Marvell’s CEO forecast higher sales in the current quarter.

Another chipmaker, Broadcom Corp. rose 5 percent, the most of any stock in the S&P 500. FBR Capital Markets said Broadcom should benefit from growing demand for smartphones and put the company on its list of top picks.

CVS Caremark Corp. rose 2 percent after the pharmacy benefits company won a three-year contract from the Blue Cross Blue Shield Federal Employee Program.

All three major stock indexes remain down slightly for the week, and declined for each of the three weeks before that. Stocks took a hard fall Monday with a batch of bad news from Europe. Another downgrade of Greece’s weak credit rating, a warning on Italy’s debt and a defeat of Spain’s ruling party deepened worries about Europe’s debt crisis.

Stocks hit their highest levels of the year April 29 following a strong run of corporate earnings. The S&P 500 has lost 2.4 percent since then as Greece struggles to avoid default and U.S. economic forecasts were revised lower, partly due to high gas prices.

Trading was thin ahead of the holiday weekend. Markets will be closed Monday for Memorial Day.

NEW YORK – Stocks are rising in midday trading after a gauge of consumer confidence unexpectedly jumped.

The Thomson Reuters/University of Michigan Consumer Sentiment index rose to 74.3 in May, above analysts’ estimates of 70. Concerns about higher gas prices and inflation knocked the gauge down to 69.8 in April.

Prices for gas have come down this month after hitting nearly $4 in April.

In a separate report, the government said personal income and spending rose 0.4 percent in April. However most of the increase was due to higher food and gas prices.

The Dow Jones industrial average is up 67 points, or 0.5 percent, to 12,470. The S&P 500 index is up 7 points, or 0.5 percent, to 1,332. The Nasdaq composite is up 15 points, or 0.5 percent, to 2,798.

NEW YORK (Reuters) – Stocks slipped on Thursday as Goldman Sachs pulled financials lower and an unexpected rise in jobless claims added to bearish sentiment that put the S&P on track for its fifth day of losses in six.

Concerns about higher inflation overseas pushed investors toward defensive stocks, with the consumer staples group the S&P’s top performer.

The Dow industrials turned positive, as investors bought some big names in the consumer staples sector. The Dow’s top two percentage gainers were Coca-Cola Co (KO.N), up 1.3 percent, and Kraft Foods Inc (KFT.N), up 1.6 percent.

Goldman Sachs (GS.N) fell 2.8 percent to $155.71 and was the biggest drag on the S&P financial sector (.GSPF), which was the benchmark’s worst-performing group, down 0.8 percent.

Late Wednesday, a report from a Senate subcommittee said Goldman had sold mortgage-linked derivatives to clients at inflated prices and misrepresented the nature of the deals.

“This is a shot across the bow for Goldman, and this certainly won’t be the last you’ll see of headlines related to this,” said Michael Mullaney, a portfolio manager who helps manage $9.5 billion at Fiduciary Trust Co. in Boston. “This could stay in the forefront for the next several months and we’ll see additional ramifications in the stock.

The Dow Jones industrial average (.DJI) was up 1.55 points, or 0.01 percent, at 12,272.54. But the Standard & Poor’s 500 Index (.SPX) was down 1.61 points, or 0.12 percent, at 1,312.80. The Nasdaq Composite Index (.IXIC) was down 9.04 points, or 0.33 percent, at 2,752.48.

The S&P’s top-performing sector was consumer staples (.GSPS) up 0.6 percent. The group’s top performer was Supervalu Inc (SVU.N), which surged 16 percent to $10.53 after reporting strong earnings.

“A lot of people are looking for defensive plays for getting into the stock market,” Mullaney said. “They’re generally high-quality dividend-paying stocks with big overseas sales, and they’ve been due for a rebound.”

Google (GOOG.O) is scheduled to report results after the market’s close. Analysts forecast the Internet company will report revenue growth of 25 percent.

The stock rose 0.2 percent to $577.36, but options activity suggested investors were bracing for a decline in the share price after Google’s earnings report.

“There has been notably more put buying over the past two weeks leading up to earnings for Google,” said Ryan Detrick, senior technical analyst at Schaeffer’s Investment Research in Cincinnati, Ohio.

Ford Motor Co (F.N) fell 2.3 percent to $14.64 after the company agreed to expand a recall of the best-selling F-150 pickup trucks. U.S. safety regulators said the recall was due to a possible short circuit that could cause airbags to deploy unexpectedly.

On the economic front, U.S. initial jobless claims unexpectedly rose in the latest week, climbing back above 400,000.

The core U.S. Producer Price Index rose faster than expected in March, adding to concerns about inflation.

In China, inflation accelerated in March at a rate as fast as 5.4 percent from a year earlier, Hong Kong media said.

(Reporting by Ryan Vlastelica; Editing by Jan Paschal)

NEW YORK (Reuters) – Wall Street rose modestly on Tuesday, led by gains in the consumer discretionary sector after McDonald’s posted earnings above Wall Street’s estimates.

Stocks wavered between small gains and losses as energy shares weakened after China’s central bank raised interest rates to tackle inflation. But the market brushed off the news by midday and resumed the rally that has pushed the Dow and the S&P to their highest in 2 1/2 years.

Dow component McDonald’s Corp (MCD.N) posted stronger-than-expected global sales at established restaurants as demand in Europe rebounded. The stock rose 3 percent to $65.67.

“It would take something unforeseen to derail this rally, and China’s rate hike was something that investors were expecting. They are expecting that not only from China but from all over the world,” said Timothy Harder, chief in investment officer at Peak Investment Services is Denver, Colorado.

“The unwinding of pessimism is now slowly turning into optimism.”

The Dow Jones industrial average (.DJI) was up 35.57 points, or 0.29 percent, at 12,197.20. The Standard & Poor’s 500 Index (.SPX) was up 2.60 points, or 0.20 percent, at 1,321.65. The Nasdaq Composite Index (.IXIC) was up 1.50 points, or 0.05 percent, at 2,785.49.

The S&P consumer discretionary index (.GSPD) was up 0.6 percent and was the top performing among S&P 500 sectors.

Merger activity continued for a second day with Kindred Healthcare Inc’s (KND.N) planned acquisition of RehabCare Group Inc (RHB.N) to create a post-acute healthcare services company.

Kindred Healthcare jumped 23.6 percent to $24.08 and RehabCare soared 43.9 percent to $36.65.

But some earnings disappointed investors.

Teva Pharmaceutical Industries’ (TEVA.O) shares fell 6.4 percent to $51.50 after the world’s biggest maker of generic drugs reported results that fell short of forecasts.

Avon Products Inc (AVP.N) posted a steeper-than-expected drop in quarterly profit, pushing shares of the world’s largest direct seller of cosmetics down 5.2 percent to $27.83.

Beazer Homes USA (BZH.N) also reported a wider-than-expected first-quarter loss, sending the stock down 1.5 percent to $5.37.

In the latest move to battle inflation, China’s central bank raised interest rates by 25 basis points, its second increase in six weeks.

The S&P energy index (.GSPE) fell 0.6 percent to be the worst-performing sector on the index.

(Reporting by Angela Moon, Editing by Kenneth Barry)