Wall Street moved higher on Tuesday after a two-day rout, as investors focused on testimonies on Capital Hill and digested upbeat earnings reports.
Hewlett-Packard, the world's biggest personal computer maker, jumped after the company unexpectedly announced that fourth-quarter and 2009 earnings would come in above Wall Street estimates. Moreover, Home Depot, the largest home-improvement retailer, rallied more than five per cent as it reported better-than-anticipated third-quarter profit.
In other corporate news, Yahoo Inc. founder Jerry Yang late Monday announced that he was stepping down as Chief Executive of the company, which was regarded as an opening to a sale to Microsoft.
However, economic concerns still gnawed at investors. The US Labour Department reported on Tuesday that wholesale prices dropped by 2.8 per cent in October, the biggest one-month decline on records, as energy prices fell sharply. Investors worried that the drop may indicate a rising threat of deflation.
Investors were also closely watching the possible bailout of the auto industry. On Tuesday, executives of General Motors, Ford and Chrysler LLC and the head of the United Auto Workers union would testify at a Senate Banking Committee hearing, as the automakers are seeking 25 billion dollars aid from the government.
Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke also testified on the use of TARP programme on Capitol Hill, as the government abandoned the original strategy of 700 billion dollars rescue plan.
The Dow Jones rose 153.00 to 8,426.58. Broader indexes also moved higher. The Standard & Poor's 500 index rose 11.34 to 862.09 and the NASDAQ advanced 7.05 to 1,489.10.