Corporate earnings boost stocks

Muscular U.S. corporate earnings and higher spirits in Europe propelled U.S. stocks higher Tuesday. Five of the 30 companies in the Dow Jones industrial average rose more than 1.5 percent. AT&T led the gains after reporting better-than-expected profit. Verizon, AT&T's main rival, was close behind. 3M, GE and DuPont rounded out the list of top gainers.

Earnings reports are blowing the tops of analysts' expectations, providing temporary relief for markets roiled by fears about Europe, said Sam Stovall, chief equity strategist with financial-data firm S&P Capital IQ. He said analysts had expected only a half-percent profit hike for the Standard & Poor's 500 this quarter, but based on results so far the gain could be 10 times bigger.

European stocks rallied after one of their worst drops in months Monday spurred by fears that deficit-cutting deals by some European nations might unravel. As the panic lifted, interest rates on Spanish bonds in circulation declined.

Only five Dow components fell, led by Wal-Mart Stores, still reeling from weekend reports of widespread bribery of foreign officials. The Dow closed up 74.39 points at 13,001.56. The S&P 500 rose 5.03 points to 1,371.97. The Nasdaq composite average fell 8.85 points to 2,961.60. -- AP