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Signs the U.S. economy remains firmly on track while inflation continues to stay under control pushed Treasury prices lower on Wednesday and yields, which move opposite of prices, headed slightly higher again. The move in key Treasury yields meant lenders had room to start nudging key mortgage product rates upward as well.

News of robust durable good orders, record-high new home sales and some better-than-expected corporate earnings among Blue Chip stocks also underpinned key stock indexes on Wednesday, although weakness in high-tech issues sucked strength from that sector.

June U.S. durable goods orders, or orders for items such as large appliances and furniture that are expected to last three or more years, leapt 1.4 percent against forecasts for a 0.5-percent decline. The surprisingly jump was fueled by strong computer sales, while the report also revealed an upward revision to 6.4-percent growth from May's original 5.5-percent gain.

Last month, sales of new homes nationwide rose 4 percent to a record 1.37 million units, according to the Commerce Dept. That outstripped forecasts for a slight decline to 1.29 million units.

At mid-afternoon, the Federal Reserve released its so-called Beige Book survey of economic activity across its 12 bank districts. This report, compiled by the Kansas City Fed with data collected on or before July 18, concluded that business activity nationwide continued to grow while price pressures eased. The Fed will use the report when making its interest-rate decision at the next Open Market Committee meeting slated for August 9.

Stocks Higher; S&P at 4-Year Peak

Most key stock indexes regained some strength on Wednesday. Buoyed by the Beige Book's strength coupled with some stronger-than-expected earnings, the benchmark Standard & Poor's 500 index ticked up to set another fresh four-year price peak.

Featured stocks on Wednesday included Boeing Co., which rose $0.35 or 0.53 percent to $66.70 after its second-quarter profit fell but still exceeded consensus forecasts. The airplane maker also raised its earnings outlook.

Amazon surged $5.91 a share, or 15.66 percent, to $43.65 after it said earnings fell to $0.12 per share, still above forecasts for $0.10 a share. A raft of pharmaceutical shares also rose, although market gains overall were undermined by weakness in technology stocks.

At closing:

The Dow 30 Industrial Index rose 57.32 points or 0.54 percent to 10,637.09; the Nasdaq Composite index was up 10.23 points or 0.47 percent at 2,186.22, and the benchmark Standard & Poor's 500 Index gained 5.63 points or 0.46 percent to close at 1,236.79.

The 30-year Treasury bond was down 11/32 in price with the yield rising to 4.47 percent from 4.45 percent at Tuesday's close.

The 10-year Treasury note was off 7/32 in price with the yield increasing to 4.25 percent from 4.23 percent at Tuesday's close.

The 5-year Treasury note was off 5/32 in price with the yield rising to 4.09 percent from 4.05 percent at Tuesday's close.

AVERAGE mortgage rates (zero discount points) based on rates collected nationwide were:

The 30-year Conventional Fixed-Rate Mortgage firmed to 5.599 percent from 5.579 percent at Tuesday's close.

The 15-year Conventional Fixed-Rate Mortgage edged up to 5.185 percent from 5.149 percent at Monday's close.

Coming Up

Thursday's economic data lineup is skimpy and features weekly U.S. jobless claims that are expected on average to rise to 320,000 for the week ended July 23.

On Friday, however, traders will wade through a several important reports, including the first glimpse at second-quarter U.S. Gross Domestic Product. Advance GDP is forecast showing 3.5-percent growth rate, with the chain deflator, another inflation gauge, expected to increase 2.6 percent. Also, the second-quarter Employment Cost Index is forecast rising 0.8 percent. The revised Michigan Sentiment Index, plus the July Chicago purchasing management indeed also will hit the wires on Friday.

Given the upward tilt in Treasury yields, mortgage lenders might see room to adjust rates slightly higher into Thursday's session if they had not already done so on Wednesday.

Laura Jacobsljacobs@interest.com

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