US STOCKS-Shares rise, whipsawed by dollar, earnings

* Travelers, McDonald’s boost Dow after reporting results

* Netflix, eBay jump on quarterly results

* Dollar gains as stocks come off their highs

* Dow up 0.4 pct, S&P up 0.2 pct, Nasdaq up 0.1 pct
* For up-to-the-minute market news see [STXNEWS/US]
(Adds Amazon falls after earnings in 13th paragraph; volume in
final paragraphs)

By Edward Krudy

NEW YORK, Oct 21 (BestGrowthStock) – Wall Street edged higher in a
volatile session on Thursday, torn between strong corporate
earnings and a surge in the U.S. dollar.

The market swung in a wide range throughout the day as
investors reacted to gyrations in the currency markets and as
relatively strong earnings took a back seat.

But by the end of the session, the fundamental picture
seemed to win out. The Dow rose, helped by McDonald’s Corp
(MCD.N: ) and Travelers Cos Inc (TRV.N: ), both of which hit
52-week highs after stronger-than-expected results.

“Companies are continuing to show that they are continuing
to make money in a low nominal GDP environment and that they
are very good at it and they can continue to do so,” said Paul
Zemsky, head of asset allocation at ING.

Investors have been trading the dollar and equities against
each other recently as expectations the Federal Reserve will
pump billions into the economy have pressured the greenback
while lifting stocks.

Commodity-linked stocks have been among the most sensitive
to the trade. Occidental Petroleum Corp (OXY.N: ) fell 2.7
percent to $78.80 while the S&P energy index (.GSPE: ) edged
lower as oil dropped more than 2 percent to under $81 per
barrel.

“The trade has been: Weak dollar is good for commodities
and is good for any risk-related assets like equities. On
dollar weakness, buy those things; on dollar strength, get out
of those things,” said Bill Strazzullo, partner and chief
investment strategist at Bell Curve Trading in Boston.

The euro and the popularly traded S&P E-mini futures
contract have tracked each other closely in the last month. In
the past 22 sessions, they have had a positive correlation
coefficient of 0.89.

The euro had earlier climbed to a high around $1.4050 but
later was trading down 0.3 percent to $1.3920.

The Dow Jones industrial average (.DJI: ) gained 38.60
points, or 0.35 percent, to 11,146.57. The Standard & Poor’s
500 Index (.SPX: ) gained 2.09 points, or 0.18 percent, to
1,180.26. The Nasdaq Composite Index (.IXIC: ) gained 2.28
points, or 0.09 percent, to 2,459.67.

Banking stocks were weak as investors continued to wrestle
with confusion in the mortgage market and the chance Bank of
America (BAC.N: ) might have to buy back mortgages bonds. The
stock fell 3.3 percent to $11.36 and has lost nearly 16 percent
over the last 7 days.

“People have been talking about Bank of America for the
last few days, and they’re going to continue to talk about bank
of America until they get better direction from management,”
said Weston Boone, vice president listed trading at Stifel
Nicolaus Capital Markets.

Shares in Amazon.com Inc (AMZN.O: ) fell sharply after the
bell as rising costs at the online retailer offset a jump in
revenue. The shares fell nearly 4.2 percent to $158 in
extended-hours trading.

McDonald’s gained 1.3 percent to $78.44 after it beat
expectations for quarterly profit and same-store sales growth
in September.

Travelers gained 0.6 percent to $54.98 after the largest
publicly traded U.S. property casualty insurer easily beat
estimates as premiums rose in its personal insurance lines.
[ID:nN21165866] [ID:nN21266849].

Stocks rose nearly 1 percent earlier but the gains were
trimmed by afternoon trade as the U.S. dollar (.DXY: ) gained
ground. The dollar was up 0.4 percent against major currencies,
while the euro (EUR=: ) fell 0.3 percent.

Online auctioneer eBay (EBAY.O: ) rose 6 percent to $27.19
and Netflix (NFLX.O: ), the movie rental and streaming service,
jumped 12.8 percent to $172.69 after both reported upbeat
results late Wednesday. [ID:nN20228251] [ID:nN20229905].

Home Depot Inc (HD.N: ) rose 3.5 percent to $31.81. Stifel
Nicolaus reiterated its “buy” rating on the stock, citing
attractive valuations after a meeting with company executives.

About 8.40 billion shares traded on the New York Stock
Exchange, the American Stock Exchange and the Nasdaq — just
below the year’s average so far of about 8.77 billion.

Despite the rise in the indexes, declining stocks
outnumbered advancers by a small margin on both the NYSE and
the Nasdaq. On NYSE 1,507 stocks rose compared to 1,450 that
fell, while on Nasdaq the ratio was about 3 decliners to 2
advancers.
(Reporting by Edward Krudy; Editing by Kenneth Barry)

US STOCKS-Shares rise, whipsawed by dollar, earnings