Closing Update: Stocks Erase Monday's Losses, Lifting Dow Back Close to 14,000

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Stocks rebounded from Monday's steep decline, finishing back near their best levels in more than five years, propelled by strong earnings and a fresh round of mergers and acquisitions activity.

Economic data showing the non-manufacturing sector continues to chug along, coupled with an unexpected rise in retail sales over the week also contributed to today's advance. All 10 sectors in the S&P 500 ended the session in the black, led by technology and consumer stocks. Commodities also gained today.

The Institute for Supply Management today reported strong hiring gains in America's non-manufacturing sector, rising 2.2 points in January to a 57.5 reading, its best level for growth since February 2006. The ISM composite index eased slightly in January, down 0.2 to a 55.2 reading last month. The report also showed a slight slow-down in new order growth.

Home prices rose for a 10th consecutive month on a year-over-year basis in December, marking the biggest gain since May 2006, according to CoreLogic. The Data analysis firm's home price index rose 0.4% from the previous month and is up 8.3% compared to December 2011 levels.

Earlier this morning, the International Council of Shopping Centers-Goldman Store Sales index showed a surprise 2.4% rise for the week ended Feb. 2 over the prior week, much better than the 1% decline industry experts were expecting. The weekly measure of same-store sales at the major retail chains also reported a 2.6% year-over-year increase in same-store sales, accounting for about 10% of total retail sales around the country.

Overseas today, Masaaki Shirakawa, Japan's central bank governor, said he will resign his post three weeks before his five-year term expires on April 8 so his departure will coincide with those of his top deputies on March 19. Shirakawa and Prime Minister Shinzo Abe have appeared at odds in recent months, but Shirakawa insisted his decision had nothing to do with Abe's call the central bank more aggressively ease monetary policy to help spur economic growth.

Commodities were mostly higher, with crude oil for March delivery was up 47 cents to settle at $96.64 per barrel. March natural gas finished 8.4 cents higher at $3.40 per 1 million BTU. April gold fell $2.60 to $1,673.70 per ounce with March silver adding 16 cents to $31.88 per ounce. March copper settled unchanged at $3.77 per pound.

Here's where the markets stood at end-of-day:

Dow Jones Industrial Average up 0.71% to 13,979.30

S&P 500 up 1.04% to 1,511.29

Nasdaq Composite Index up 1.29% to 3,171.58

GLOBAL SENTIMENT

Hang Seng Index down 2.27%

Shanghai China Composite Index up 0.20%

FTSE 100 Index up 0.58%

UPSIDE MOVERS

(+) VMED, Sets new 52-week high after confirming discussions with Liberty Global ( LBTYA ) concerning a possible merger.

(+) ARMH, Reports Q4 earnings of $0.06 per share, in-line with analyst estimates. Revenues beat the Street view, coming in at $259.06 million versus the $238.86 analysts were expecting.

(+) DELL, Finalizes $24.4 billion buyout, with plans to pay shareholder $13.65 for each of their shares. The company has a 45-day "go-shop" period to solicit alternative proposals.

(+) OPXA, Announces development agreement worth up to $255 million with an affiliate of German conglomerate Merck KGaA for its Tcelna T-cell treatment for patients with muscular sclerosis.

DOWNSIDE MOVERS

(-) YUM, Lowers FY13 earnings outlook, now sees mid-single digit decline, excluding special items, down from its prior guidance forecasting 10% growth. Q4 EPS of $0.83 beats by $0.01.

(-) PBR, Reports 36% year-over-year decline in FY12 profit. Also cuts dividend in order to save cash to pay for its investment plans.

(-) ACI, Posts wider-than-expected $0.42 per share Q4 net loss, ex items, reversing a $0.33 profit last year and trailing analyst forecasts for a $0.14 loss. Revenue declined 21% to $968.2 million, also shy of expectations.

(-) BIDU, Q4 earnings of $1.31 per ADR beat the Street view by $0.02. Revenues rise 42% to $1.02, narrowly topping expectations. Analysts at Stifel Nicolaus and Raymond James both cut their respective ratings to the equivalent of neutral following the Q4 results.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Commodities

Referenced Stocks: LBTYA

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