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U.S. Stocks Climb After Dow Tops 15,000 Amid Earnings

*from, May 8, 2013 (To view original article click here.)

Take Away #1: U.S. stocks rose, after the Dow climbed above 15,000 for the first time yesterday, as earnings forecast from companies beat analyst estimates.

Key Facts and Figures:

  • The S&P 500 Index rose 0.3% to 1,630.42 at 1:28 p.m. in New York.
  • The Dow added 17.48 points, or 0.1%, to 15,073.68
  • Trading in the S&P stocks was in line with the 30-day average at this time of day.
  • “We’ve recovered from the nervousness that we saw in the market in April and we’ve built a nice base here,” said Peter Jankovskis of Oakbrook Investments LLC.
  • “We’ve gotten through the earnings season and we’re turning to the phase in the quarter where economic reports will determine if the market can hold up,” Jankovskis said.
  • The S&P 500 rose to its fourth straight record yesterday and the Dow closed above 15,000 for the first time on optimism over global central bank stimulus and better-than-estimated corporate earnings.
  • U.S. stocks are in the fifth year of a bull market amid three rounds of bind purchases by the Federal Reserve.

Take Away #2: About 86% of S&P 500 stocks traded above their average prices from the past 50 days as of yesterday, according to data compiled by Bloomberg.

Key Facts and Figures:

  • That is the highest level since Feb. 13, while below the two-year high of 93% in January.
  • News Corp. and Monster Beverage Corp. are among five S&P 500 companies reporting earnings today.
  • About 72% of companies that have released results since the start of the earnings season have exceeded profit projections, while 52% have missed sales estimates, data compiled by Bloomberg show.

Take Away #3: The S&P 500 will extend its record rally as the U.S. central bank continues using economic stimulus as a way to reduce unemployment, according to Scott Black of Delphi Management Inc.

Key Facts and Figures:

  • “There’s room to go on the upside, especially since you’re getting nothing on the fixed-income side,” Black said.
  • “There’s every indication that Ben Bernanke is going to remain accommodative because we’re not even near the threshold where he wants to get unemployment back under 6.5%,” said Black.

Take Away #4: Fed Chairman Ben S. Bernanke has kept overnight interest rates near zero since December 2008.

Key Facts and Figures:

  • Bernanke has also embarked on a bond buying program that that has expanded the central bank’s balance sheet to more than $3 trillion.
  • The Fed had pledged to maintain its policy as long as U.S. unemployment remains above 6.5% and the outlook for inflation does not exceed 2.5%.

Take Away #5: Economic data from China and Germany today came in better than expected.

Key Facts and Figures:

  • Chinese export growth unexpectedly accelerated in April even as shipments to the U.S. and Europe fell.
  • German industrial production also rose more than forecast, increasing for a second month in March in a further sign that Europe’s largest economy is returning to growth.

Take Away #6: Raw-material, technology, and financial shares had the biggest gains among 10 groups in the S&P 500, advancing at least 0.7%, and the VIX rose 0.5% to 12.89.

Key Facts and Figures:

  • The equity volatility gauge, or the VIX, is down 28% for the year.
  • UnitedHealth Group Inc. added 2.4% to $61.97 and Alcoa Inc. gained 2.3% to $8.84 for the biggest gains in the Dow.

Take Away #7: Whole Foods, Electronic Arts, J.C. Penney, and Sotheby’s advance.

Key Facts and Figures:

  • Whole Foods Market Inc. gained 10% to $102.49 and Net Income rose to about $142 million, or 76 cents a share, from $118 million, or 64 cents, a year earlier.
  • Analysts had projected profit of 73 cents per share, the average of 24 estimates compiled by Bloomberg.
  • The company also said profit excluding certain items will be as much as $2.89 a share in fiscal 2013, up from a previous estimate of as much as $2.87.
  • Analysts estimate $2.87 a share, on average.
  • Electronic Arts Inc. increased 16% to $21.29, the highest since January 2012.
  • The company forecast adjusted earnings of $1.20 a share in the year ending in March, exceeding the $1.10 average estimate compiled by Bloomberg.
  • J.C. Penney Co. added 8.2% to $17.75.
  • The department store chain that replaced its CEO last month said preliminary fiscal first-quarter sales fell 16%, a smaller drop than a year earlier.
  • J.C. Penney CEO Myron Ulman is working to improve sales after revenue last year tumbled 25% to $13 billion amid Ron Johnson’s failed attempt to remake the retailer.
  • Sotheby’s rose 2.5% to $35.79.
  • The auction house sold a Paul Cezanne painting for $41.6 million in its impressionist and modern art sale yesterday.

Take Away #8: Symantec, Williams Cos., and Manchester United decline.

Key Facts and Figures:

  • Symantec declined 3.6% to $24.19.
  • Revenue in the current period, which ends June, will be $1.61 billion to $1.65 billion, the security software maker said yesterday.
  • Profit excluding some costs will be 35 cents to 36 cents a share.
  • Analysts on average had projected sales of $1.7 billion and profit of 44 cents.
  • Williams Cos., the third largest U.S. pipeline company, lost 4.8% to $35.22.
  • The company posted its full-year earnings forecasts through 2015, trailing the current analyst estimates for all three years.
  • Manchester United Plc. Lost 1.3% to $18.53.
  • Alex Ferguson will retire as British soccer’s most successful manager, having led the club to 38 trophies in 26 years.

Take Away #9: The S&P 500 may trigger a longer-term buy signal for global equity markets, even it nears a resistance level, according to Roelof-Jan van den Akker of ING Groep NV.

Key Facts and Figures:

  • The measure is nearing its short-term resistance of 1,635, signaling a possible 1.6% decline from yesterday’s finish to 1,600 within the next two weeks.
  • Still, a monthly close above the longer-term resistance level of 1,600 would send a buy signal for the next year.
  • That would trigger a greater increase in the S&P 500 that will lead the global stock markets even higher, van den Akker said.
  • “Prices are slowly breaking the upward rising resistance line around 1,600,” van den Akker said.
  • “Even though we may see a short-term pullback that we will consider normal, the S&P 500’s uptrend is intact and likely to continue. Prices are still in a steep upward move in the next few weeks,” he said.
  • In technical analysis, investors and analysts study charts of trading patterns and prices to predict changes in a security, commodity, currency or index.

*To view original article from click here.

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