Stock Market News for February 07, 2014 - Market News

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A drop in initial claims and encouraging results from Disney helped benchmarks achieve their best single-day performance since Dec 18. The gains somewhat offset weekly losses and Friday's session will be crucial to help benchmarks post a rare weekly gain. Consumer discretionary sector was the best performer for the day among the S&P industry groups.

For a look at the issues currently facing the markets, make sure to read today's Ahead of Wall Street article

The Dow Jones Industrial Average (DJI) soared more than 188 points, or 1.2%, to finish yesterday's trading session at 15,628.53. The Standard & Poor 500 (S&P 500) too jumped 1.2% to close at 1,773.43. The tech-laden Nasdaq Composite Index was up by a decent 1.1% to end at 4,057.12. The fear-gauge CBOE Volatility Index (VIX) dropped 13.6% to settle at 17.23. Total volume on the New York Stock Exchange was 3.84 billion. For 73% stocks that gained on the NYSE, 24% stocks ended in the red.

Investors were buoyed by news of a drop in initial claims, which comes after weaker-than-expected private job creations and ahead of nonfarm payroll data. The U.S. Department of Labor reported yesterday that the advance figure for seasonally adjusted initial claims dropped to 20,000 to 331,000 in the week ending Feb 1. The drop was also larger than consensus estimate of a decline to 334,000.

This report was a big relief as it came after a disappointing national employment report from Automatic Data Processing, Inc. (NASDAQ: ADP ). The report stated 175,000 private jobs were added in January, lower than expectations of 189,000 job additions. Also, December's reading was revised downward, from 238,000 to 227, 000. January's les key nonfarm payroll data scheduled for release today.

Also lifting the mood was robust earnings result from The Walt Disney Company (NYSE: DIS ). The popular entertainment company reported earnings per share of $1.04, ahead of the Zacks Consensus Estimate of 91 cents. The film studio division was a major gainer for the company, riding on the success of latest releases of "Frozen", and "Thor-The Dark World". The Studio Entertainment division jumped 28% year over year. Shares of Disney were up a significant 5.3% and led the gains among the 30 Dow components.

Separately, European Central Bank's decision not to cut interest rates also helped the bullish mood. Major European indices had closed higher following this news, and the optimism spread to some extent to this side of the Atlantic as well.

Consumer discretionary sector was the biggest gainer for the day among the S&P industry groups. The Consumer Discretionary Select Sector SPDRA (XLY) jumped 2.1%. Key stocks such as Comcast Corporation (NASDAQ: CMCSA ), Amazon.com Inc. (NASDAQ: AMZN ), McDonald's Corp. (NYSE: MCD ), Twenty-First Century Fox, Inc. (NASDAQ: FOXA ), priceline.com Incorporated (NASDAQ: PCLN ) and Time Warner Inc. (NYSE: TWX ) gained 1.2%, 2.4%, 1.5%, 1.4%, 1.3% and 0.3%, respectively.

The gains could offset some of the weekly losses, but the benchmarks are still staring at weekly losses. So far this week, the Dow and S&P 500 are both down 0.5%, while the Nasdaq is down 1.1%. These losses were largely due to the drubbing markets were subjected to following weaker-than-expected domestic manufacturing data. The Institute for Supply management reported its January PMI had dropped 5.2 percentage points from December's adjusted reading of 56.5% to 51.2%.



AUTOMATIC DATA (ADP): Free Stock Analysis Report

AMAZON.COM INC (AMZN): Free Stock Analysis Report

COMCAST CORP A (CMCSA): Free Stock Analysis Report

DISNEY WALT (DIS): Free Stock Analysis Report

TWENTY-FST CF-A (FOXA): Free Stock Analysis Report

MCDONALDS CORP (MCD): Free Stock Analysis Report

PRICELINE.COM (PCLN): Free Stock Analysis Report

TIME WARNER INC (TWX): Free Stock Analysis Report

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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.



This article appears in: Investing , US Markets

Referenced Stocks: XLY , ADP , AMZN , CMCSA , DIS

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