US STOCKS-Wall St marks best week in a year; earnings on tap

                                

                                
 * Investors look ahead to earnings season
                                
 * Google rises as China renews license, helping Nasdaq
                                
 * Johnson & Johnson shares down on drug recalls
                                
 * Stocks up: Dow 0.6 pct, S&P 0.7 pct, Nasdaq 1 pct
                                
 * For up-to-the-minute market news see [STXNEWS/US]
 (Rewrites first paragraph, adds comment, adds links to
graphics and Reuters Insider video in paragraphs 16, 17)
                                
 By Angela Moon
                                
 NEW YORK, July 9 (Reuters) - Wall Street closed out its
best week in a year on Friday, snapping back from a long
stretch of selling, as investors looked ahead to what many
expect will be a solid earnings season.
                                
 Stocks ended near the day's highs, but trading was thin.
Just 6.197 billion shares traded on the New York Stock
Exchange, the American Stock Exchange and Nasdaq, making it the
lowest-volume day of the year.
                                
 Google Inc <GOOG.O> helped lift the Nasdaq, rising 2.4
percent to $467.46 after Beijing gave the company the green
light to continue operating its China Internet search page.
U.S.-listed shares of rival Baidu Inc <BIDU.O> fell 1.7 percent
to $71.20. For details, see [ID:nSGE6680F9]
                                
 The major stock indexes advanced 5 percent in the
holiday-shortened week, as investors put a string of dismal
data behind them to focus on what is expected to be another
solid quarter for corporate results.
                                
 "We expect to see good margins, very healthy balance sheets
 and companies basically saying that even with the slowdown, we
are very well prepared for it," said Marc Pado, U.S. strategist
at Cantor Fitzgerald & Co. in San Francisco.
                                
 "We have been seeing from previous data that companies are
not building inventory and not adding workers. In other words,
they are very well positioned for the worst case scenario,"
Pado said.
                                
 The Dow Jones industrial average <.DJI> was up 59.04
points, or 0.58 percent, at 10,198.03. The Standard & Poor's
500 Index <.SPX> was up 7.70 points, or 0.72 percent, at
1,077.95. The Nasdaq Composite Index <.IXIC> was up 21.05
points, or 0.97 percent, at 2,196.45.
                                
 The earnings season unofficially begins with Alcoa Inc
<AA.N> after the closing bell on Monday. Analysts are expecting
overall second-quarter earnings to grow by 27 percent,
according to Thomson Reuters data. This is up from the 22.4
percent that analysts were anticipating at the beginning of the
year. [ID:nN08195712]
                                
 Alcoa, the first Dow component to report, is expected to
swing to a second-quarter profit, though falling aluminum
prices have prompted analysts to cut their estimates on the
stock. [ID:nN09269488]
                                
 The S&P 500 rose for a fourth straight day, up 5.4 percent
this week, its best week since mid-July 2009. But the index is
still down about 11.7 percent from its most recent closing high
in late April.
                                
 The Dow rose 5.3 percent and the Nasdaq advanced 5 percent
this week.
                                
 Johnson & Johnson <JNJ.N> was the biggest drag on the Dow,
falling 1.4 percent to $60.54 a day after it recalled more
Tylenol and other over-the-counter drugs following consumer
complaints of odors. The move expands a recall started in
January. [ID:nN08230084]
                                
 In addition to Alcoa, companies reporting next week include
JPMorgan Chase & Co <JPM.N>, Bank of America Corp <BAC.N> and
General Electric Co <GE.N>.
                                
 Banks will be scrutinized by investors concerned about
delinquencies and loan demand to gauge the sustainability of a
recent improvement in credit quality. [ID:nN07172590]
<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
                                
 For graphics on financial companies earnings preview, see
http://link.reuters.com/kus36m
                                
For a Reuters insider video on the view of the economy by
Barclays, see
                                
 http://link.reuters.com/nux56m
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
                                
 In deal news, Air Products and Chemicals Inc <APD.N> late
Thursday raised its hostile bid for rival Airgas Inc <ARG.N> by
5.8 percent to $5.3 billion, but the offer remained slightly
below the company's current market value. [ID:nN08231796]
                                
 Air Products rose 1.4 percent to $69.74, while Airgas rose
1.6 percent to $64.90.
                                
 In economic news, U.S. wholesale sales fell unexpectedly in
May, lifting inventories to their highest level in 11 months, a
government report showed. Analysts said a slackening in demand
could lead businesses to try to curb the inventory buildup,
weighing on economic growth. [ID:nN09265120]
                                
 Recent U.S. data showing slowing growth in the services and
manufacturing sector, weakness in housing and a stagnating jobs
market also worried investors, although most say it is too
early to call a double-dip recession.
                                
 The day's trading volume fell well below last year's
estimated daily average of 9.65 billion. Advancing stocks
outnumbered declining ones on the NYSE by 2383 to 627 while on
the Nasdaq, advancers beat decliners by 1979 to 642.
 (Reporting by Angela Moon, Editing by Kenneth Barry)