NEW YORK (Dow Jones) – U.S. stocks rose Wednesday as a rosier picture for the housing and industrial markets emerged from the latest round of economic data, while better-than-expected earnings from a range of companies including Deere also boosted sentiment.

The Dow Jones Industrial Average was up 32 points, or 0.3%, at 10300 in recent trading. Bank of America was the measure’s best performer, extending its gains from Monday with a 2.2% rise. Home Depot was also particularly strong, up 1.8%, as housing starts rose to their highest level in six months, while Caterpillar climbed 1.1% as a report on industrial production also topped expectations.

The Nasdaq Composite rose 0.4%. The Standard & Poor’s 500-share index climbed 0.3%, led by its consumer discretionary and consumer staples sectors. Home Depot was among the consumer-discretionary sector’s gainers, as was rival Lowe’s, which rose 1.3%. The staples sector was boosted by Whole Foods Market, which jumped 10% after the grocer reported a 71% rise in fiscal first-quarter profit, topping Wall Street expectations, and raised its 2010 earnings and sales view.

The stock gains, while fairly modest, represent a return among market participants to focusing on domestic economic data and earnings reports. In recent weeks, stocks have been weighed down by worries over sovereign debt in European nations such as Greece, in addition to concerns over how China’s tightening measures could affect demand for U.S. materials companies.

“It finally seems, after what seems like a pretty long wait, that fundamental domestic and profit data are dictating the direction of stocks,” said Craig Peckham, equity trading strategist at Jefferies. “We were in a consistent pattern of mixed to negative global economic data points in spite of constructive data in the U.S., and in the absence of any negatives out of Europe or Asia overnight,” domestic data points are back in focus, Peckham said.

Among Wednesday’s economic reports, housing starts climbed 2.8% in January, the strongest pace since July 2009. Meanwhile, the Labor Department reported that U.S. import prices rose for the sixth straight month and by more than expected in January, largely due to a sharp increase in volatile oil prices. And U.S. industrial production increased in January by 0.9%, slightly above economists’ forecast of an 0.8% increase.

Deere was a big focus among the latest round of companies that reported quarterly earnings. Its shares jumped 6.1% after the maker of farming and construction equipment posted a surprise 19% rise in earnings that beat market expectations. The company also lifted its profit forecast for the year.

American depositary shares of ING Groep climbed 4.4% after the Dutch financial services company posted a narrower fourth-quarter net loss as the burden of write-downs and other charges eased from a year ago.

Among other stocks in stocks, Walgreen edged up 0.5% after agreeing to buy Duane Reade from private-equity firm Oak Hill Capital Partners for $618 million in cash, excluding debt, making the nation’s largest drug store chain also the market leader in New York City.

In other markets, crude-oil futures rose above $77 per barrel, although gold futures edged lower while the dollar strengthened against both the yen and the euro. Treasurys slipped, with the 10-year note off 1/4 to yield 3.693%.

Still to come, the Fed will release minutes from the Federal Open Market Committee after 2 p.m. EST.

The minutes are key, Peckham said, as market participants try “to ascertain directionally what’s going to happen from a policy standpoint.” He noted that with there being one dissenter in the latest meeting to the Fed’s decision to keep rates near zero, “the level of dissent and spirit of debate within the committee is important for the market to understand.”

If you enjoyed this post then Subscribe to Savvy Investor via RSS