Closing Update: Big Gains For Most Stocks After Summers Falls Out of Line For Fed Chairmanship
Stocks rallied today, with the S&P 500 briefly climbing past the 1,700 mark for the first time ever after former Treasury Secretary Lawrence Summers late yesterday said he would not be a candidate to replace Federal Reserve Chairman Ben Bernanke. In addition to avoiding an expected contentious confirmation process, investors were cheered by the move, believing it clears a path for current Fed Vice Chairman Janet Yellen to move up and maintaining the central bank's accommodative policies. Most industry sectors in the S&P 500 advanced, led by financial and industrial stocks. Mining and materials stocks also rose as gold and other metals gained as the U.S. dollar dropped against other currencies. Treasuries also rose today as the Fed was seen as maintaining its easy-money bias.
Economic data today also took some of the wind out of most tapering scenarios coming out of the Federal Open Markets Committee meeting Wednesday. The New York Fed's index of general business conditions fell from a 8.24 reading in August to a below-consensus 6.29 score this month. That was followed the Commerce Department reporting a 0.4% rise in industrial production, trailing market expectations, while capacity utilization came in at 77.8% versus the market consensus looking for a 77.9% rise.
Energy stocks fell today with a decline in crude oil prices after U.S. and Russian diplomats this weekend struck a tentative deal to identify and remove Syria's chemical weapon reserves, sharply ratcheting down regional tensions that pushed crude as high as $110 per barrel in recent weeks. Technology stocks also finished lower as a group, largely due to another 3% slide for Apple Inc. ( AAPL ) after the Wall Street Journal reported China Telecom ( CHA ) is reducing its customer subsidies for the new iPhone 5S smartphones - effectively making it more expensive than other iPhone models. AAPL's ongoing slide also kept the tech-heavy Nasdaq Composite index in negative territory today.
Gold for December delivery rose $9.50 to $1,318.30 per ounce while December silver added 28 cents to settle at $22.00 per ounce. December copper gained 2 cents to finish at $3.22 per ounce. October crude was off at $106.80 per barrel while October natural gas was up cents to settle at $3. per 1 mln BTU.
Here's where the markets stood at end-of-day:
Dow Jones Industrial Average up 118.80 (+0.77%) to 15,494.86
S&P 500 up 9.61 (+0.57%) to 1,697.60
Nasdaq Composite Index down 4.34 (-0.12%) to 3,717.85
Hang Seng Index up 1.47%
Shanghai China Composite down 0.22%
FTSE 100 Index up 0.51%
(+) OMER, Wedbush Securities raises price target for the stock by $10 to $28 a share, maintaining an Outperform rating.
(+) IGLD, Israeli regulators approve the takeover of Bezeq Israeli Telecommunications Corp (BEZQ), with the rival Israeli telecom owning a 31% stake in BEZQ.
(+) BZ, Packaging Corp of America ( PKG ) announces deal to acquire all outstanding BZ shares for $12.55 each, Aggregate transaction value, including BZ debt: $1.995 billion.
(-) PERI, Agrees to merge with the Client Connect business of Conduit Ltd. in an all-stock transaction that will give Conduit an 81% stake in the combined companies.
(-) ODFL, Trucking company reduces its expectations for Q3 per-hundredweight revenue, excluding fuel charges, by a full percentage point from its prior guidance to a new range of 3% to 3.5% growth.
(-) QIHU, Sohu.com Inc. ( SOHU ) accepts rival $448-million investment from Tencent Holdings Ltd. for its Sogou unit rather continuing with talks with QIHU about a possible buyout of the internet-search engine subsidiary.