The S&P 500 ended above the 2k mark for the first time
following encouraging economic data on Tuesday. Merger and
acquisition news between Burger King and Tim Hortons also helped
the benchmarks end higher. The Dow hit a record intraday level of
17,153.80, but shed some of the gains by the end of the day.
For a look at the issues currently facing the markets, make sure to
Ahead of Wall Street
The Dow Jones Industrial Average (DJI) rose 0.2% to close at
17,106.70. The Standard & Poor 500 (S&P 500) increased 0.1%
to close at 2,000.02. The tech-laden Nasdaq Composite Index closed
at 4,570.64; rising 0.3%. The fear-gauge CBOE Volatility Index
(VIX) rose 0.6% to settle at 11.63. A total of 4.25 billion shares
were traded on Tuesday, lower than the monthly average of 5.44
billion. Advancers outpaced declining stocks on the NYSE. For 64%
stocks that advanced, 32% declined.
The Conference Board reported that the Consumer Confidence Index
rose to 92.4 in August from 90.3 in July. The number was higher
than the consensus estimate of 88.6. This was also the highest
level since Oct 2007.
Investors were also encouraged by the durable orders report. The
U.S. Department of Commerce reported that durable orders in July
soared 22.6%, beating the consensus estimate of 10%. The jump in
July's durable orders was mainly boosted by the rising demand for
commercial aircraft. According to the report, the new orders for
commercial aircraft and parts surged 318% in July.
However, home price data for June was lesser than expected. The
S&P/Case Shiller composite index of 20 cities fell 0.2% on
seasonally adjusted basis in June, missing the forecast of an
unchanged reading. The index for 10 cities also declined 0.1% in
June. Housing prices rose just 8.1% year on year in June in 20
cities, failing to meet expectations of 8.4% increase.
Shares of Tim Hortons Inc. (
) jumped 8.5% after Burger King Worldwide (
) agreed on Tuesday to buy the Canadian restaurant chain for about
$11.4 billion. This will create one of the biggest fast-food chains
in the world. Burger King will move its headquarters from Miami to
Canada; making it the latest company seeking to relocate to a
lower-tax country. It was also reported that legendary investor
Warren Buffett's Berkshire Hathaway Inc. (
) is providing $3 billion in preferred equity financing to help the
transaction. However, Burger King's shares dropped 4.3% following
Late on Monday, Amazon.com Inc. (
) announced the acquisition of Twitch Interactive, a video game
streaming company, in an all-cash deal for around $970 million.
This will be the second biggest acquisition by Amazon. The deal
will enhance the company's online media and content offerings,
giving it a competitive edge over other video streaming companies.
Shares of Amazon climbed 2.3% on Tuesday.
Amazon's acquisition announcement boosted the NASDAQ-100 Index
yesterday. Key components of the index such as Facebook, Inc. (
), eBay Inc. (
), Cisco Systems, Inc. (
) and QUALCOMM Incorporated (
) rose 1.3%, 1.4%, 0.5% and 0.6%, respectively.
However, shares of Best Buy Co., Inc. (
) declined 6.9% after reporting second-quarter fiscal 2015 revenues
of $8,896 million, missing the Zacks Consensus Estimate of $8,968
million. Revenues also declined 4% year over year and comparable
store sales declined 2.7%. Management expects comps to decline to
low-single digits in the second half of fiscal 2015. Best Buy was
the worst performer among the S&P 500 companies on Tuesday.
The Energy Select Sector SPDR (XLE) was the biggest gainer among
the S&P 500 sectors. The sector gained 0.5% yesterday. Key
energy stocks from the sector such as Halliburton Company (
), EOG Resources, Inc. (
), Exxon Mobil Corporation (
) and Schlumberger Limited (
) rose 1.8%, 1.4%, 0.9% and 0.7%, respectively. Out of 10 S&P
sectors, 7 sectors registered gains on Tuesday.
Want the latest recommendations from Zacks Investment Research?
Today, you can download 7 Best Stocks for the Next 30 Days.
Click to get this free report
TIM HORTONS INC (THI): Free Stock Analysis
BURGER KING WWD (BKW): Free Stock Analysis
BERKSHIRE HTH-B (BRK.B): Free Stock Analysis
AMAZON.COM INC (AMZN): Free Stock Analysis
BEST BUY (BBY): Free Stock Analysis Report
FACEBOOK INC-A (FB): Free Stock Analysis Report
EBAY INC (EBAY): Free Stock Analysis Report
CISCO SYSTEMS (CSCO): Free Stock Analysis
QUALCOMM INC (QCOM): Free Stock Analysis Report
HALLIBURTON CO (HAL): Free Stock Analysis
EOG RES INC (EOG): Free Stock Analysis Report
EXXON MOBIL CRP (XOM): Free Stock Analysis
SCHLUMBERGER LT (SLB): Free Stock Analysis
To read this article on Zacks.com click here.