The U.S. stock market is looking to get back on solid footing
after falling sharply last week amid expectations that the
Federal Reserve will begin tapering its bond-buying program at
the September FOMC meeting.
Stocks rose for the second day on Wednesday and the bond
market was also strong. Money continued to flow out of precious
metals, however, with gold closing at a 3-year low.
The Dow Jones Industrial Average rose around 150 points on the
session and the S&P and Nasdaq recorded gains of a little
less than 1 percent.
The Dow Jones Industrial Average rose 150 points, or 1.02
percent, to 14,910.
The S&P 500 climbed 15 points, or 0.96 percent, to
The Nasdaq added 28 points, or 0.85 percent, to 3,376.
GDP - Third Estimate
First quarter GDP was revised down for the third estimate to
1.8 percent growth compared to 2.4 percent growth in the previous
estimate. The consensus had expected GDP to remain unrevised at
2.4 percent. Normally, GDP revisions are small, so the large
decline for the third estimate caught economists by surprise,
although it did not prevent the market from rallying on
Crude oil only recorded small gains on Wednesday despite a big
rally for stocks. At last check, NYMEX crude futures were up 0.29
percent to $95.60 while Brent contracts were trading higher by
0.55 percent to $101.82. Natural gas futures rose 1.65 percent to
Precious metals prices continued to plummet on Wednesday as
money moved into equities. COMEX gold futures were last down
nearly 4 percent to $1,226.50 while silver futures lost almost 5
percent to $18.59. Copper shed a little less than 1 percent on
the day to $3.0475.
In the grains complex, corn and wheat both fell. Corn futures
were last down around 0.09 percent while wheat lost 1.17 percent.
Movers in soft commodities included lumber and orange juice.
Lumber futures traded up 3.42 percent while orange juice lost
almost 5 percent on the day.
Bond prices rose along with stocks on Wednesday. Near the
close of equities, the iShares Barclays 20+ Year Treasury Bond
) was up 0.78 percent to $108.72. Yields fell as prices rose on
Treasury yields were as follows on Wednesday afternoon: The
2-Year Note was yielding 0.39 percent while the yield on the
5-Year Note was 1.42 percent. The 10-Year Note and 30-Year Bond
were yielding 2.54 percent and 3.58 percent, respectively.
The U.S. Dollar continued its rise on Wednesday. Heading into
the closing bell, the PowerShares DB US Dollar Index Bullish ETF
), which tracks the performance of the greenback versus a basket
of foreign currencies, was up 0.45 percent to $22.50.
The closely watched EUR/USD pair was last trading down 0.66
percent to $1.3003. The only other significant mover on the
session was the GBP/USD, which fell 0.75 percent.
Volatility and Volume
The CBOE Volatility Index continued to plunge on Wednesday as
the market has bounced back from last week's losses. At last
check, the VIX was down more than 7 percent to 17.14.
Volume was lighter than normal on the session. Only around 116
million SPDR S&P 500 ETF (NYSE:
) shares traded hands versus a 3-month daily average of 142
Home BancShares (NASDAQ:
) rose more than 12 percent on Wednesday after the company agreed
to merge with Liberty Bancshares. The move will significantly
increase the bank's deposit market-share in Arkansas.
Shares of Cheniere Energy Partners (NYSE:
) were up almost 10 percent on Wednesday, possibly after
receiving a favorable mention on CNBC's Mad Money with Jim
) climbed nearly 9 percent on the day after the company raised
its Q4 guidance.
) had climbed around 12 percent near the close although there was
no news to account for the move. The stock did breakout to a new
52-week high, however, and may be being driven by momentum.
Brocade Communications (NASDAQ:
) added more than 6 percent on no news on Wednesday.
Pawn-store operator First Cash Financial Services (NASDAQ:
) lost more than 10 percent on Wednesday after the company cut
its full-year outlook and provided second-quarter guidance below
Rogers Communications (NYSE:
) fell almost 9 percent on the day after reports that Verizon is
looking to enter the Canadian telecommunications market.
Apollo Group (NASDAQ:
), the operator of the University of Phoenix, fell more than 10
percent after the company reported a lower profit for its fiscal
Mistras Group (NYSE:
) fell more than 16 percent after the company cut its earnings
outlook for the fiscal year.
Shares of gold miner Royal Gold (NASDAQ:
) fell almost 8 percent amid slumping prices for the yellow
(c) 2013 Benzinga.com. Benzinga does not provide investment
advice. All rights reserved.
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