Stocks rose Tuesday, recovering from significant losses earlier in the session, on optimism about quarterly results from Apple and speculation about possible moves by the U.S. federal reserve (Fed). Stocks opened sharply lower after Goldman Sachs reported a big drop in quarterly profit and Johnson & Johnson (J&J) lowered its full-year profit outlook. Weaker-than-expected revenues from IBM also concerned the market. Investor tone improved in the afternoon on rumors that the Fed is considering additional steps to encourage bank lending. Ben Bernanke, the chairman of the U.S. central bank, is scheduled to testify before Congress on Wednesday. In U.S. economic news, housing starts fell to their lowest level in eight months in June, down 5 percent from May, but applications for building permits-a measure of future activity-rose 2.1 percent. A second government report showed that unemployment eased in 39 of the 50 U.S. states but that the labor market remains weak. The U.S. dollar rose versus the euro and the yen. Light sweet crude oil for August delivery rose 78 cents to $75.53 a barrel on the New York Mercantile Exchange. Gold rose $10 to $1,192.20. The Dow Jones industrial average rose 75.53, or 0.75 percent, to 10,229.96. Drugmaker J&J's second-quarter profit rose 7 percent on flat sales, but the firm's shares fell 2 percent after it lowered its full-year profit estimate. The broader Standard & Poor's 500 index rose 12.23, or 1.1 percent, to 1,083.48. The technology-heavy Nasdaq composite index rose 24.26, or 1.1 percent, to 2,222.49. Apple is among the many companies scheduled to report quarterly results after the market closes Tuesday.
