Wall Street Races Higher Amid Earnings, Spain Optimism

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The markets soared on Tuesday, propelled by strong earnings from Dow component Coca-Cola and easing worries about the eurozone debt crisis.

Today's Markets

As of 2:30 p.m. ET, the Dow Jones Industrial Average climbed 197 points, or 1.5%, to 13118, the S&P 500 rose 22.3 points, or 1.6%, to 1392 and the Nasdaq Composites gained 61.9 points, or 2.1%, to 3050.

The gains were broad-based on the day, but the technology, basic materials, financial and energy sectors performed the strongest. Out of the Dow components, Coca-Cola (NYSE:KO) and Hewlett-Packard (NYSE:HPQ) performed the best. Apple (NASDAQ:AAPL) helped the Nasdaq zoom higher, jumping 4.3% after tumbling in the last session.

Market participants had a bounty of headlines to parse through on Tuesday. In particular, traders were focusing on the slew of corporate results that were released ahead of the opening bell.

Goldman Sachs (NYSE:GS), Coca-Cola and Johnson & Johnson (NYSE:JNJ) all reported ahead of the opening bell. After the bell, IBM (NYSE:IBM), Intel (NASDAQ:INTC), Yahoo (NASDAQ:YHOO) and CSX (NYSE:CSX) are set to post first-quarter results.

Goldman revealed a first-quarter profit of $3.92 a share on revenue of $9.95 billion. Analysts expected the investment-banking behemoth to earn $3.55 on $9.48 billion. Goldman also boosted its dividend to 46 cents a share from 35 cents.

Coke posted first-quarter earnings of 89 cents a share, excluding charges, on sales of $11.14 billion, topping expectations of 87 cents on $10.82 billion. J&J unveiled a first-quarter EPS of $1.37, excluding items, on revenue of $16.1 billion. Analysts expected the health-care giant to earn $1.35 on $16.26 billion.

The eurozone debt crisis has once again taken the spotlight amid worries that Spain may have difficulty servicing its debt. Analysts say that the country's economic recession may worsen as the government implements tough austerity measures, making it increasingly difficult to pay lenders back.

Spain sold one-year and 18-month paper on Tuesday. Demand for both bills was strong, with the Treasury seeing bid-to-cover ratios above those notched in March, according to a report by the Wall Street Journal. Still, the yield on each nearly doubled. A more important auction of longer-term bonds is on tap for Thursday. The yield on 10-year bonds in the secondary market fell to 5.94% after closing above the 6% mark for the first time since the European Central Bank stepped in to catalyze banks' buying of sovereign debt.

Also on that front, the International Monetary Fund said it sees the eurozone economy contracting by 0.3% in 2012 and then bouncing back and expanding at a pace of 0.9% the following year.

Traders also had two economic reports to digest.

Housing starts dropped 5.8% to 654,000 last month, the lowest level since October. Economists were looking for a reading of 705,000. Meanwhile, the more forward-looking read on permits to build new homes jumped 4.5% to 747,000, beating expectations of 710,000. Homebuilders such as Toll Brothers (NYSE:TOL) and Lennar (NYSE:LEN) are sometimes particularly affected by these data.

U.S. industrial production was unchanged in March, weaker than the 0.3% increase economists were expecting. The measure that tracks the industrial sector is used by the Federal Reserve to gauge "structural developments" in the U.S. economy across business cycles.

Commodities were mixed. Crude oil traded in New York climbed $1.67, or 1.6%, to $104.59 a barrel. Wholesale New York harbor gasoline dipped 3 cents, or 0.87%, to $3.238 a gallon.

In metals, gold rose $3.00, or 0.22%, to $1,653 a troy ounce.

Foreign Markets

European blue chips jumped 1.4%, the English FTSE 100 gained 0.79% to 5711 and the German DAX rallied 1.2% to 6701.

In Asia, the Japanese Nikkei 225 fell 0.06% to 9465 and the Chinese Hang Seng dipped 0.23% to 20562.