Dow up 245 as stocks hit multiyear highs
Hope for a resolution to Europe's debt crisis and decent US jobs data boost the Dow and S&P 500 to 4-year highs. The Nasdaq hits a 12-year top. Jobless claims fall, and ADP says private employers added 201,000 workers in August.
Stocks closed at multiyear highs today after jobless claims fell more than expected and a measure of private-sector job growth was also stronger than expected.
Investors were also bullish after the European Central Bank announced its plans to start a government-bond buying program to support the finances of troubled countries, especially Spain, Italy and Portugal. European stocks were also sharply higher.
The Dow Jones Industrial Average ($INDU) closed up 245 points to 13,292, its best close since Dec. 28, 2007. The Standard & Poor's 500 Index ($INX) had its best close since Jan. 3, 2008, and the Nasdaq Composite ($COMPX) had its best finish since Nov. 15, 2000.
Metals, energy and financial stocks were the market leaders. Such well-known stocks as Amazon.com (AMZN), Walt Disney (DIS), Costco Wholesale (COST), McCormick & Co. (MKC) and J.M. Smucker (SJM) hit all-time highs.
The Dow's close was just below its high of the day -- 13,294. The S&P 500 gained 29 points to 1,432. The point gains for the Dow and S&P 500 were their biggest since June 29. The Nasdaq gained 67 points to 3,136 in its largest gain since June 6. The Nasdaq-100 ($NDX) index was up 63 points to 2,830, its biggest gain since June 29 and its best finish since Dec. 12, 2000.
Article continues below. Apple (AAPL), the biggest influence on the Nasdaq-100, was up $6.04 to $676.27, about $4.60 below its all-time high. The company is expected to unveil its iPhone 5 next week.
Amazon.com was up $5.16 to $251.38 after introducing three new versions of its Kindle Fire tablet device today and an upgrade of the existing Kindle Fire tablet. The shares hit a new intraday high of $252.70.
With today's gains, the Dow is up 8.8% for the year, with the S&P 500 up 13.9% and the Nasdaq up 20.4%.
Futures trading suggests a flat open for stocks on Friday, but the Labor Department's payroll and unemployment report, due at 8:30 a.m., could quickly move markets.
Crude jumps, then falls back; gold tops $1,700
Meanwhile, crude oil (-CL) traded above $97 a barrel for several hours in New York before settling at $95.53 a barrel. Brent crude was at $113.10 this afternoon, up a penny from Wednesday.
The national average for regular unleaded gasoline fell to $3.823 a gallon from Wednesday's $3.824, according to AAA's Daily Fuel Gauge Report.
Gold (-GC) settled at $1,705.60 an ounce, its first close above $1,700 since early March. Gold is up 6.3% this quarter and 8.9% for the year. Silver was up 34.5 cents to $32.674 an ounce. It's up 18.3% for the quarter and 17.1% for the year.
The market's gains and the decent jobs data will give President Obama ammunition when he speaks tonight at the Democratic National Convention. Republicans have been arguing the administration's economic policies have failed.
|Energy prices -- New York close|
|Thur.||Wed.||Month chg.||YTD chg.|
|Crude oil (-CL)||$95.53||$95.36||-0.97%||-3.34%|
|Heating oil (-HO)||$3.1425||$3.1176||-1.19%||7.83%|
|Natural gas (-NG)||$2.7760||$2.7950||-0.82%||-7.13%|
|(per mil. BTU)|
|Unleaded gasoline (-RB)||$2.9910||$2.9498||0.61%||12.55%|
|(per gallon; AAA)|
Surprisingly good jobs data
Stocks were surging in pre-market trading even before the ECB announced its bond-buying program. That's because jobless claims fell to a seasonally adjusted 365,000, a decline of 12,000.
At the same time, the ADP National Employment Report said private employers created 201,000 jobs in August, and it revised its July job-growth estimate from 163,000 to 173,000.
The ADP report increased investor confidence that Friday's jobs report will show at least 163,000 new jobs created in August.
Nomura Securities expects a net gain of 111,000 jobs, with the unemployment rate holding at 8.3%.
If the report is better than expected, that will reduce the odds the Federal Reserve will start a new stimulus program. the Fed's Federal Open Market Committee, its policy-setting body, meets Wednesday and Thursday.
Meanwhile, the Institute for Supply Management's non-manufacturing index for August rose slightly to 53.7 from 52.6 a year ago and better than the Street expectation of 53. The index was powered by growing demand for labor and price increases.
What the ECB hopes to accomplish
The ECB plan is designed to support the debt markets of fiscally challenged countries and ensure that their banks have enough access to its credit lines.
ECB President Mario Draghi told a news conference in Frankfurt, Germany, that the measures will provide "a fully effective backstop" against market volatility. The key piece of the program is that the ECB will buy government bonds in the open market.
The plan was greeted with cheer in European markets. German and French stocks were up about 3% on the day. British stocks rose more than 2%. The Spanish 10-year government-bond yield fell to 6.03% today. It had been as high as 7.5% on July 23. Italy's 10-year bond yield was at 5.286%, down from 5.514% on Wednesday. It had reached 7.11% in November.
But the Draghi plan already has a powerful opponent: Jens Weidmann, president of Germany's Bundesbank, doesn't think the ECB should be buying government bonds.
And Germany's Constitutional Court will rule on whether Germany can participate in the plan on Sept. 12.
A broad rally -- but light volume
Today's was a broad rally with one important caveat: Volume was light. New York Stock Exchange volume hit 736 million shares. Gainers were ahead of decliners 3.84-to-1 on the NYSE and 3.6-to-1 on Nasdaq.
Housing stocks hit four-year highs as the housing recovery becomes clearer. (And with that clarity comes the reminder that starts and sales are still well below their highs at the top of the housing bubble.) The Philadelphia Housing Sector Index ($HGX) finished at 149.80, up 3.52 points and its highest level since Sept. 15, 2008. The index is up 45.5% this year, the best performance of 44 indexes that Market Dispatches tracks.
All 30 Dow stocks were higher on the day, led by Bank of America (BAC), Cisco Systems (CSCO) and JPMorgan Chase (JPM). The laggards were American Express (AXP), Verizon Communications (VZ) and Johnson & Johnson (JNJ).
So were all 20 stocks in the Dow Jones Transportation Average ($DJT), which jumped 94 points to 5.045. All of the stocks in the Philadelphia Semiconductor Index ($SOX) were higher; the index jumped 14 points to 404.54.
Meanwhile, 482 S&P 500 stocks were higher, led by Owens-Illinois (OI), First Solar (FSLR) and chip-maker SanDisk (SNDK). Seagate Technology (STX), Walgreen (WAG) and Reynolds American (RAI) were the laggards.
Sears Holdings (SHLD) and SanDisk were the top Nasdaq-100 stocks. Only three stocks in the index were lower: Warner Chilcott (WCRX), Seagate and Fastenal (FAST).
Sears rose on news that chairman Eddie Lambert had bought about 2.4 million shares this week. The shares have nearly recovered all of their loss resulting from the stock's being removed from the S&P 500.
|Short hits from the markets -- New York close|
|Thur.||Wed.||Month chg.||YTD chg.|
|13-week Treasury bill||0.1000%||0.100%||11.11%||900.00%|
|5-year Treasury note||0.676%||0.620%||13.42%||-18.55%|
|10-year Treasury note||1.673%||1.594%||7.11%||-10.58%|
|30-year Treasury bond||2.799%||2.705%||4.28%||-3.12%|
|U.S. Dollar Index||81.033||81.235||-0.23%||0.63%|
|(in U.S. $)|
|U.S. $ in pounds||£0.627||£0.629||-0.33%||-2.53%|
|Euro in dollars||$1.26||$1.26||0.35%||-2.44%|
|(in U.S. $)|
|U.S. $ in euros||€ 0.791||€ 0.793||-0.35%||2.50%|
|U.S. $ in yen||79.05||78.40||0.71%||2.53%|
|U.S. $ in Chinese||6.37||6.35||0.05%||0.65%|
|(in U.S. $)|
|(in Canadian $)|
|(per troy ounce)|
|(per troy ounce)|
|Crude oil (-CL)||$95.53||$95.36||-0.97%||-3.34%|
16 TRILLION...in Debt.
Thank You Democrats.
Thank You Republicans.
Both you Idiots...have done a splendid job.
What a pathetic creature Bumbleweedbutt is writing post after post attacking the GOP and Mitt. You'd think one or two, like I do, would be enough to express his unhappiness? He must be a shill for the Democratic Party?
And his attacks? They have no substance beyond being blatant Ad Hominems! This clown is a clear example of what the Democrats have to offer the American people.
Let's face it people with Obama, your taxes are going up along with more government in your lives and faces. The poor will receive the benefits (and paying nothing for them) while the rest of us will be taxed to death until we too become poor.
Go Mitt & Paul go. All left thinking democrats blow!
2012 Current Rate
2013 New Rate
Medicare (Employee & Employer)
Top Fed Income Tax
Subtotal Increase in 2013
Top Cap Gains Tax
Tax on Dividends
Additional Surtax on Investment Incomes
Subtotal Increase in 2013
Limit on Itemized Deductions
Estate Tax Exemption
Alternative Minimum Tax Fix Expires in 2013
Here’s the OBAMA TAX INCREASE facts from the ObamaCare (Patient Protection and Affordable Care Act) - arranged by their respective effective dates, below is the total list of all $500 billion-plus in tax hikes (over the next ten years) in Obamacare, where to find them in the bill, and how much your taxes are scheduled to go up as of today.
The market is up because things are so bad in Europe that they are going to monetize their debt. Great! I'll buy some stock. But wait.... Germany doesn't think the ECB should be buying government bonds. Well if Germany doesn't like it, I wouldn't bet on it since it's their money the ECB is spending.
It's a great day for the traders though. It'll go the other way when the details come out.
Job reports are a nonissue today. Smoke and mirrors.
The EU has been in recession (overall out put has shrunk in 2012), a 0.2 contraction in growth this quarter, their GDP down 0.5 from the same quarter last year, and yet everyone is feeling good about pilling more cheap debt on top of existing debt. WOW!!!!!
Good thing I'm in the position to 'ride this wave' without resorting to increasing my risk. Many are not, especially in Europe. Like I stated yesterday, try and keep your investment interests here in the USA or you'll get burned for sure.
Let's see, the european central bank is going to print money to buy bonds, which are instruments of debt. The governments sell these bonds to get money to finance themselves. Then when the bonds mature, the governments have to pay off more than they sold the bonds for, with printed money. Does anyone else see a dog chasing his tail until he collapses in exhaustion.
Does the term DERIVATIVES come to mind?????????????????????????????
How many LostOnEarth guys one need to change a lightbulb??
1 stands on the table to hold the lightbulb and 4 alike (i.e.Endeavor15 - or is it 20 now) that turn the table!!
ok a few facts here about this rally
1) Where is the ECB going to get the monies to buy the government debt??? Answer they are going to print monies out of thin air like magi.
and you wonder why the BRICS are now trading with each other in their own currencies.
2) If Europe is so broke that they have to now just print money out of thin air just how does this make their stock market (or ours) gain in value??? Answer it devalues the stocks and bonds thus creating the mother of all bubbles right now.
and you wonder why children and stock brokers believe in Santa Claus and the Easter bunny.
they already believe that you can merely print your way into wealth now.
3) What happens when all that money hits the economy??? Answer even though the governments involved are using a stable basket of goods like buggy whips and slide rulers to gauge that inflation is not really a problem the problem is nobody buys or knows what those things are and that allows inflation to out strip the middle and low class from being able to buy things anymore.
and you wonder why people hid their heads in the sand. The governments by ruling out energy and food should merely say they are ruling out anything that had more then 0.5 percent annual inflation from the core inflation calculation. Thereby inflation will alway remain between zero (no items in the basket to calculate) and 0.5 percent. The Fed's work is done inflation has been tamed.
4) The debt crisis is now going to get even bigger and bigger like Japan's and one day it's going to explode.
Now that the BRICS are not trading in dollars or euros things are going to get bad very quickly
APEC has decided to expand growth merely between member states and forget about non APEC members pretty much as China is in this group the US and Europe are now dead economics.
Here we go.........the media is making this look good...........on the EU word, there hasn't been any
positive action yet, just keep your money in the stock market and when it finally comes down,
all of our debt and the EU's collapse, lets see what excuses they will have for that. There is
absolutely no basis for the stock market to go this high........back to 2007 levels......its stating
that we are in as good as shape as we were back then........unemployment is high, we are
going into debt more and more each day by hundreds of millions of dollars and they are trying
to tell you things are good..........as the old saying goes..." A fool and his money are soon parted"
buy silver and gold, have some tangible assets, not worthless money. I will NOT vote for one
person in congress who is running for re-election, they no longer represent us the people.
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[BRIEFING.COM] The major averages ended higher across the board as the S&P 500 advanced 0.8%.
Equities climbed steadily since the opening bell as investors prepared for tomorrow's policy decision from the Federal Reserve. Although chatter in recent weeks has included speculation the Fed would look to taper its asset purchases, today's broad gains suggest investors expect mostly reassuring words from Chairman Bernanke at tomorrow's press conference.
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