Mixed earnings put breaks on stock market rally

NEW YORK -- Investors are holding off from making more big bets on the economy.

Stocks traded mixed Wednesday as traders remained hesitant to push further into the market following a week-long surge on strong earnings reports.

The day's earnings reports gave reasons for both hope and concern. Apple and Starbucks jumped after beating analysts' estimates but chipmaker Advanced Micro Devices and major bank Wells Fargo fell after reporting disappointing results.

Strong corporate earnings for the April-June quarter have pushed major stock indicators up more than 8% in the past seven days. The surge has restarted a rally that ran from early March through mid-June before stalling on a scarcity of signs that the economy was stabilizing.

Recent gains have pushed the Dow Jones industrial average up enough to erase its losses for the year and to its highest level since January. The benchmark Standard & Poor's 500 index is at levels not seen since November.

Monday, the Dow's momentum stalled. The blue chip index fell 34.68, or 0.4%, to 8,881.26. In the broader market, the Standard & Poor's 500 index fell 0.51, or 0.5%, to 954.07, and the Nasdaq composite index rose 10.18, or 0.5%, to 1,926.38, helped by quarterly results at Apple and Starbucks.

Analysts warn that the stock market could have a harder time advancing because investors are now expecting more polished results. Of the approximately 100 companies in the S&P 500 index that have posted results, 62% have topped analysts' expectations, according to S&P.

"As the earnings season goes on it becomes more difficult because the bar goes higher and higher," said John Canally, economist at LPL Financial in Boston.

Major market indexes seesawed much of Tuesday, but managed to end higher. Investors battled worries over rising loan losses at regional banks and a mixed report from Federal Reserve Chairman Ben Bernanke, who cautioned that the economy's recovery will be gradual because of rising unemployment.