Gains in small-cap and high-growth stocks drove benchmarks
higher on Thursday and led the S&P 500 close to a record high.
The Nasdaq was boosted primarily by gains in bio-tech stocks.
Markets also received mixed economic data. While claims for
unemployment benefits increased, existing home sales data rose for
the first time this year.
For a look at the issues currently facing the markets, make sure to
Ahead of Wall Street
The Dow Jones Industrial Average (DJI) gained about 0.1% to close
Thursday's trading session at 16,543.08. The Standard & Poor
500 (S&P 500) went up 0.2% to finish at 1,892.49. The
tech-laden Nasdaq Composite Index rose almost 0.6% to 4,154.34. The
fear-gauge CBOE Volatility Index (VIX) advanced 1.0% to settle at
12.03. Total volume for the day was roughly 5.1 billion shares,
lower than this month's average of 5.9 billion. Advancers outpaced
declining stocks on the NYSE. For 62% stocks that advanced, 34%
Benchmarks ended higher on Thursday boosted primarily by gains in
small-cap stocks. The Russell 2000 Index of small-caps went up 0.9%
on Thursday. The index outperformed the broader S&P 500.
Currently, the index is less than 8.0% away from its record high of
1,208.65 achieved on March 4.
On Monday, the index had reached a high of 1,116.04, before
settling at 1,114.43. Last week, the index rebounded 0.6% on Friday
after slipping 0.7% on Thursday followed by a decline of 1.6% on
Wednesday and a drop of 1.1% on Tuesday.
High-growth stocks also extended their gains. Shares of momentum
stocks such as Internet television network provider Netflix, Inc.
), online travel company TripAdvisor Inc. (NASDAQ:
), electric car maker Tesla Motors, Inc. (NASDAQ:
) and Internet radio service provider Pandora Media, Inc. (NYSE:
) increased 0.3%, 3.2%, 2.7% and 1.3%, respectively.
Internet stocks from the Technology sector such as Google Inc.
), Groupon, Inc. (NASDAQ:
), Yelp, Inc. (NYSE:
), LinkedIn Corporation (NYSE:
), Yahoo! Inc. (NASDAQ:
) and FireEye, Inc. (NASDAQ:
) gained 1.1%, 1.7%, 4.8%, 2.1%, 0.9% and 3.8%, respectively.
Bio-tech stocks also advanced yesterday. Gains in bio-tech stocks
ensured a positive finish for the Nasdaq. Gilead Sciences Inc.
), Vertex Pharmaceuticals Incorporated (NASDAQ:
) Amgen Inc. (NASDAQ:
), Biogen Idec Inc. (NASDAQ:
) and Celgene Corporation (NASDAQ:
) increased 1.3%, 6.0%, 1.2%, 1.5% and 1.6%, respectively.
Dollar Tree, Inc. (NASDAQ:
) was the biggest gainer in the S&P 500. Shares of the discount
retailer surged 6.6% after the company reported quarterly results.
The company reported earnings for the first quarter 2014 of $0.67,
a 13.6% increase year on year and in line with the Zacks Consensus
Economic data came in mixed, hardly impacting the bullish mood of
the investors. The U.S Department of Labor reported that seasonally
adjusted initial claims increased 28,000 to 326,000 in the week
ending May 17. This increase in applications for unemployment
benefits was in contrast to the drop in initial claims in the prior
week. Last week, initial claims had dropped to a seven-year low.
Separately, The Conference Board's leading economic index increased
0.4% in April after it gained 1.0% in March. The rise was in line
with the consensus estimate.
Meanwhile, existing home sales data released by National
Association of Realtors increased 1.3% to a seasonally adjusted
annual rate of 4.65 million in April from 4.59 million in March.
Existing home sales rose for the first time this year. It also rose
at the fastest pace since December 2013. However, the consensus
estimate was that the figure would increase to 4.69 million.
The SPDR S&P Homebuilders ETF (XHB) advanced 1.9%, the highest
among the S&P 500 sectors. Key housing stocks such as
PulteGroup, Inc. (NYSE:
), Lennar Corp. (NYSE:
), DR Horton Inc. (NYSE:
) and Beazer Homes USA Inc. (NYSE:
) increased 2.2%, 1.9%, 2.4% and 4.9%, respectively. Overall, 8 out
of 10 sectors of the S&P 500 ended in the green.
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