Stocks Higher as Investors See Solution Nearing in European Debt Crisis

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Stocks are higher at the session's half as hope grows that a roadblock in European efforts to resolve its debt crisis nears a solution. Investors also await further details from the Federal Reserve's meeting last month, after Aloca ( AA ) kicked off what was largely described as a gloomy start to the third quarter earnings season.

Alcoa reported late yesterday that third-quarter earnings came in below expectations that had already been lowered. Shares have traded down over 4% in the session.

Also, minutes from the Sept. 20-21 meeting of Federal Reserve policy makers will be closely watched at its 2 p.m. ET release. That's the meeting at which the Fed announced its plan to "twist" the yield curve by swapping shorter-maturity government bonds for longer-dated instruments.

Overseas, the Slovakian parliament rejected a plan to expand the area's 440 billion euro ($600 billion) bailout fund. The rejection was not unexpected, as the ruling party had struggled to obtain support for the plan.

Top European Union officials on Wednesday urged Slovakia to quickly approve changes to the euro-zone bailout fund, the European Financial Stability Facility. "We remain confident that the Slovak authorities and the parliament are fully aware of the critical importance of an enhanced and more flexible EFSF to preserve financial stability in the euro area," said European Commission President Jose Manuel Barroso and European Council President Herman Van Rompuy, in a joint statement.

In company news:

Shares of Liz Claiborne Inc. ( LIZ ) are off session highs but have remained firm, up more than 30%, after it said it will sell its signature brand as well as others in a major overhaul that will included a name change. The company, which has been struggling financially, intends to focus on trendy brands favored by high-end customers. No name has been announced yet.

Research in Motion ( RIMM ) is down as shares give back much of yesterday's gains following a new disruption in service for its signature BlackBerry hand-held device, which spread to North America from Europe.

Wal-Mart Stores Inc. ( WMT ) is higher after posting positive same-store sales results, following a misstep that led to the reduction of thousands of store items, angering shoppers. The company said it is in the process of adding back 10,000 items there were pulled from store shelves in an efficiency move and resulted in a rare customer backlash for the retailer.

Shares of Citigroup ( C ) are higher after The Wall Street Journal reported that Chief Executive Vikram Pandit praised bank regulators for stabilizing the financial system and the controversial Volker Rule could have the for correcting the balance between capital and speculation. Citi shares are trading up over 5%.

Shares of Merck (MRK) are higher after Bloomberg reported late yesterday that the Australian unit of the drug maker won an effort to overturn the first trial decision in a case outside of the U.S. where plaintiffs claimed the company did not adequately warn of the heart risks associated with its painkiller Vioxx.

Shares of Chevron (CVX) are up as the oil major said its third quarter profit would be comparable to its Q2 profit of $3.55 a share. Analysts expect the company to report EPS of $3.43.

Commodities are mixed. December gold contracts are up 0.3% to $1,679 an ounce while November crude oil contacts are down 0.3% to $85.57 a barrel.

In energy ETFs, the United States Oil Fund (USO) is up 0.12% to $33.06 and the United States Natural Gas fund (UNG) is down 2.21%, to $8.65.

In precious metal ETFs, the SPDR Gold Trust (GLD) is up 0.41% to $162.84. Market Vectors Gold Miners (GDX) is up 0.56% to $57.25. iShares Silver Trust (SLV) is up 0.64% to $31.58.

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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 Nasdaq, Inc.

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