Markets ended in the green after optimistic news about the economy from the Fed lifted the mood of investors. Earlier in the day, news of strong earnings and deals sent the markets higher.
The Dow Jones Industrial Average rose 0.5% to 12,228.17. 23 out of 30 stocks of the blue chip index rose with JP Morgan (NYSE:JPM) gaining 2.39% to close at $47.94, making it one of the highest gainers of the Dow. The Standard & Poor’s 500 Index increased 0.63% to 1,336.32. Energy and natural resources companies were the best performers for the index. The Nasdaq Composite gained 0.76% to close at 2,825.56. On the New York Stock Exchange, breadth of the market was positively biased as for every 1 stock that fell, nearly 3 stocks ended in the green with a consolidated volume of 4.12 billion shares being traded.
The Federal Reserve said factory orders rose for the fifth consecutive month although industrial production declined. Minutes of the Fed’s policy meeting held last month were also released according to which Fed officials unanimously raised their forecast for economic growth for the current year and opined that inflation was not an immediate threat. In a separate report, the Commerce Department said new home construction rocketed up at the fastest rate for the past 20 months. On the other hand, wholesale prices for January spiked up due to high cost of gas and other goods.
Benchmarks indexes dropped some points on reports about Iranian warships entering the Suez Canal. The Israeli foreign minister claimed Iran was preparing to send two warships through the Suez Canal to Syria, calling it a provocation. However officials in Egypt controlling the channel denied such reports, saying warships need permits to cross the Suez and no such requests had been made so far.
Coming to news of earnings and estimates, shares of Deere & Co (NYSE:DE) gained 2.4% after the equipment maker’s net income more than doubled due to growing sales in the U.S and Canada in its large farm machinery segment. The company’s share prices closed at $95.86. Teen clothing maker Abercrombie & Fitch’s (NYSE:ANF) shares rose 7.58% after reporting its fourth quarter earnings results. Better U.S results and strong overseas sales have helped its net income to grow to nearly double. Comcast Corporation (NASDAQ:CMCSA) reported its earnings results beating analysts’ expectations. The company’s share prices increased 4.01% to $25.13 after more customers registered for the combo offer of a combination of T.V, high speed internet and digital phone services.
On a sectoral basis, share prices of energy companies rose after a release showed bullish petroleum supply data. The Philadelphia oil services index along with some other key indexes showed prices of crude were rising. Crude futures increased 0.8% to $84.99 per barrel. RBC Capital Markets has upgraded Valero Energy Corp (NYSE:VLO) to top pick, helping share prices of the refiner to increase 2.57% to 29.18. Shares of Frontier Oil Corp (NYSE:FTO), Holly Corporation (NYSE:HOC) and Western Refining Inc (NYSE:WNR) gained 7.38%, 3.21%, and 7.25% to close at $27.94, $60.14, and $17.61 respectively.
Investor Nelson Peltz’s firm announced its decision to pay up to $60 a share to buy Family Dollar Stores (NYSE:FDO). The shares of the retailer rocketed 21% to close at $53.25 making it one of the largest gainers of the day in the S&P 500 Index. Sanofi-Aventis, the French drug-maker agreed to buy US biotechnology firm Genzyme Corp (NASDAQ:GENZ) for $20 billion in cash. Share prices of the company increased 1.07% to close in the green.
ABERCROMBIE (ANF): Free Stock Analysis Report
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DEERE & CO (DE): Free Stock Analysis Report
FAMILY DOLLAR (FDO): Free Stock Analysis Report
FRONTIER OIL (FTO): Free Stock Analysis Report
GENZYME-GENERAL (GENZ): Free Stock Analysis Report
HOLLY CORP (HOC): Free Stock Analysis Report
JPMORGAN CHASE (JPM): Free Stock Analysis Report
VALERO ENERGY (VLO): Free Stock Analysis Report
WESTERN REFING (WNR): Free Stock Analysis Report
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