NEW YORK (MarketWatch) — U.S. stocks inched up Thursday as investors took a somewhat optimistic view of a mixed bag of earnings reports and economic data.

The Dow Jones Industrial Average (DJI:^DJI – News) was up 14 points, or 0.1%, to 10,323, in recent trading. Insurance provider Travelers Cos. (NYSE:TRV – News) was the measure’s top performer, up 1.7%. DuPont (NYSE:DD – News) also was strong, up 0.9%, as metals futures pared their earlier declines.

The materials sector was lifted on an upgrade from Bank of America Merrill Lynch of steel-products maker Nucor Corp. (NYSE:NUE – News) to neutral from underperform. The firm cited an increased steel-price view. Nucor, which is not a Dow component, jumped 1.7%.

Among the Dow’s earnings reporters, Hewlett-Packard Co. (NYSE:HPQ – News) climbed 0.4% after posting a 25% profit rise in the first quarter and a higher fiscal-year revenue outlook. Read more in Tech Stocks.

However, Wal-Mart Stores Inc. (NYSE:WMT – News) weighed on the Dow with a 1.5% drop. The discount-retail giant posted a 22% gain in fourth-quarter profit, but provided tepid first-quarter earnings guidance. In addition, Wal-Mart’s sales at U.S. stores open more than a year fell. Read more on Wal-Mart.

The Nasdaq Composite (Nasdaq:^IXIC – News) edged up 2 points, while the S&P 500 Index was up less than 1 point. The S&P 500’s materials and industrials sectors were particularly strong, while its telecommunications and energy sectors weighed.

In other markets, the dollar strengthened against the euro and the yen after trading lower against those currencies earlier in the session. Crude futures rose to nearly $78 a barrel. Gold futures recovered from sharp drops in the wake of the International Monetary Fund’s announcement Wednesday night that it will sell 191.3 metric tons of gold on the open market rather than to central banks. Treasurys declined, with the 10-year note off 15/32 to yield 3.795%.

The action came as investors were disappointed not only by Wal-Mart’s guidance and sales but also by U.S. jobs and inflation data, although H-P’s report and recent improvements in housing starts and manufacturing data provided some support for a broad, if slow recovery.

“Every day the market looks for evidence of whether or not the recovery is sustainable, whether or not we have segued into a virtuous cycle,” said Quincy Krosby, market strategist at Prudential Financial. “The problem is every day you get mixed evidence, but that’s not abnormal. It takes a long time in a recovery, particularly one in a recovery like this, to have a day of purely positive data. But we try to put together a mosaic of the economic landscape and over all, it’s more positive than negative.”

Krosby added that while Thursday’s gains in stocks were modest, “this kind of move for the market is actually a positive in that it reassures investors that we can actually focus on fundamentals rather than having a market moving so emotionally with headline news.”

Among Thursday’s reports, the Labor Department’s weekly report showed initial claims for jobless benefits last week increased more than economists had been expecting. The producer-price index for finished goods last month also rose more than expected.

In a more upbeat report, the Federal Reserve Bank of Philadelphia said mid-Atlantic manufacturers posted better-than-expected improvement this month, paced by new orders. Meanwhile, the Conference Board’s index of leading economic indicators began 2010 with another gain, pointing to a strengthening U.S. recovery. However, the 0.3% increase was slightly below the 0.4% increase economists had predicted.

Among stocks in focus, Priceline.com Inc. (NasdaqGS:PCLN – News) jumped 9.4% after its fourth-quarter profit more than doubled, as the online-travel firm’s bookings continued to soar. Revenue topped the company’s bullish expectations and it projected strong first-quarter results.

source: Yahoo finance

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