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Benchmarks ended higher on Thursday and the S&P 500 closed at a record high after the Federal Reserve Chairwoman Janet Yellen blamed  the  harsh  winter  climate  for  the  recent  weakness  in  the  economy. Retailer J C Penny and drug maker Mylan’s upbeat earnings reports were welcomed by investors. The day’s economic data on durable goods and business spending also added to the positive sentiment.

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) gained 0.5% to close Thursday’s trading session at 16272.65.  The Standard & Poor 500 (S&P 500) too added 0.5% to finish at 1854.29. The index topped its all-time high achieved on January 15. The tech-laden Nasdaq Composite Index rose 0.6% to 4318.93. The fear-gauge CBOE Volatility Index (VIX) plunged 2.7% to settle at 14.04. Total volume on the New York Stock Exchange was 3.5 billion shares. Declining stocks were outnumbered by advancing stocks on the NYSE. For 31% stocks that declined, 66% advanced.
 
US stocks began the day on a cautious note but gained momentum following Fed Chairwoman Janet Yellen’s testimony before the Senate Banking Committee. Her dovish comments lifted investors’ mood. Yellen said she was willing to scrutinize the economic slowdown and feels that severe winter weather might be responsible for the temporary slowdown. She indicated that the Fed may continue reductions in the asset purchase program as long as it is good for the economy.
 
News on the earnings front was reassuring for investors. Retailer J. C. Penney Company, Inc. (NYSE:JCP) led the gains among the retail stocks. Shares of J C Penny climbed 25.3% on the index after the company reported narrower-than-expected fourth quarter loss followed by a buoyant outlook for fiscal 2014. The company posted adjusted loss of 68 cents, which was narrower than the Zacks Consensus Estimate of a loss of 79 cents. For the first-quarter fiscal 2014, management expects comparable store sales to increase 3%-5% year over year.
 
Coming to the Health Care sector, better-than-expected earnings of generic drug maker Mylan, Inc. (NASDAQ:MYL) boosted the S&P 500 and NASDAQ. Its stock rose 9.4% after reporting  fourth quarter 2013 earnings of 78 cents a share (excluding special items), which surpassed Zacks Consensus Estimate of 75 cents a share. For 2014, the company expects adjusted earnings in the range of $3.25–$3.60 per share, up 19% year over year. The Zacks Consensus Estimate (pre-earnings) of $3.39 per share is within the company’s guidance range.
 
Markets were not much impacted by the mixed durable goods report. According to the US Census Bureau new orders for manufactured durable goods in January decreased 1%. However, excluding transportation it increased 1.1%. On the other hand unfilled orders for manufactured durable goods in January were up 0.1%.
 
The initial claims report  by the US Department of Labor reported an increase of 14,000 to 348,000 in the week ending February 22. This was higher than the consensus for the current period of 335,000. Despite this rise in unemployment benefits, the four-week average remained unchanged at 338,250.
 
Nine out of ten sectors of the S&P 500 ended in green. The Technology Select Sector SPDR (XLK) and Materials Select Sector SPDR (XLB) led the gains as both the sectors rose 0.8%. Key stocks from the Technology sector such as Apple Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), International Business Machines Corporation (NYSE:IBM) and AT&T, Inc. (NYSE:T) soared 1.9%, 1%, 0.7% and 0.7%, respectively.
 
Material sector stocks such as E. I. du Pont de Nemours and Company (NYSE:DD), The Dow Chemical Company (NYSE:DOW), Praxair Inc. (NYSE:PX) and LyondellBasell Industries NV (NYSE:LYB) went up 0.8%, 1.4%, 0.8% and 1.2%, respectively.

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