Stocks end higher after choppy day of trading

NEW YORK -- About halfway through first-quarter earnings reports, Wall Street still isn't sure where the economy is headed as investors sent stocks higher Thursday after a shaky day of trading.

The Dow Jones industrials closed Thursday with a gain of about 71 points, or 0.9%, but only after another schoppy, back-and-forth day of trading.

Some companies reported strong earnings including PNC Financial Services Group, which boosted other bank stocks including JPMorgan Chase, Bank of America Corp. and Wells Fargo.

Poor results from other companies, such as UPS UPS and steelmaker Nucor, signaled trouble, however, and economic data was downbeat, too. Sales of exisitng homes fell 3% in March, and claims for both new and continuing unemployment benefits rose last week.

Meanwhile, a big unknown still looms over the market: The results of the government's "stress tests," which will measure banks' ability to survive severe loan losses. The Federal Reserve is expected to explain its methodology for the tests on Friday and release results on May 4.

"We're in the middle of spring and people are trading stocks on hope," said Charles Ortel, managing director at Newport Value Partners in New York. "But the harder data that are appearing are very negative."

Investors are more confident that the economy is no longer in a freefall than they were at the start of the year. But they are no more certain about the economy's direction than they were when earnings season began about two weeks ago. The bulk of earnings from large companies are in, and they've been mixed.

The stock market is holding up, which is a good sign. But it's not extending its massive rally, either. After hitting nearly 12-year lows in early March, the Dow rallied and hit 8,131 last Friday. It has been wobbling underneath that level since.

"The most important thing that everybody's looking for is clarity — good, bad or indifferent," said Anthony Conroy, managing director and head trader for BNY ConvergEx Group.