US STOCKS-Wall St rebounds as Bernanke defends policy

Tue Feb 26, 2013 2:43pm EST

* S&P 500 bounces back from biggest daily drop since Nov. 7

* Possible stalemate in Italy remains a concern

* Home Depot rises as profit, sales top expectations

* Dow up 0.8 pct, S&P up 0.6 pct, Nasdaq up 0.4 pct

By Chuck Mikolajczak

NEW YORK, Feb 26 (Reuters) – U.S. stocks climbed on Tuesday, rebounding from their worst decline since November after Federal Reserve Chairman Ben Bernanke defended the Fed’s bond-buying stimulus before Congress.

Bernanke, in testimony before the Senate Banking Committee, strongly defended the Fed’s bond-buying stimulus program and quieted rumblings that the central bank may pull back from its stimulative policy measures, which were sparked by the release of the Fed minutes last week.

Bernanke’s testimony helped ease concerns about a stalemate in Italy after a general election failed to give any party a parliamentary majority, posing the threat of prolonged instability and financial crisis in Europe, and sending the S&P 500 to its worst decline since early November in the previous sessions.

Bernanke “certainly said everything the market needed to feel in order to get comfortable again,” said Peter Kenny, managing director at Knight Capital in Jersey City, New Jersey.

“The fear is we were going to see a rollover, and the first shot over the bow was what we saw out of Italy yesterday with the elections,” Kenny said. “When it came to U.S. markets, we saw some of that bleeding stop because our focus shifted from the Italian political circus to Ben Bernanke.”

Gains in homebuilders and other consumer stocks, following strong economic data, lifted the S&P 500 and a 5.6 percent jump in Home Depot to $ 67.38 boosted the Dow industrials. The PHLX housing sector index rose 3.3 percent.

However, the central bank chairman also urged lawmakers to avoid sharp spending cuts set to go into effect on Friday, which he warned could combine with earlier tax increases to create a “significant headwind” for the economic recovery.

The Dow Jones industrial average climbed 109.04 points, or 0.79 percent, to 13,893.21. The Standard & Poor’s 500 Index gained 8.96 points, or 0.60 percent, to 1,496.81. The Nasdaq Composite Index advanced 13.46 points, or 0.43 percent, to 3,129.71.

Despite the bounce, the S&P 500 also failed to move above 1,500, a closely watched level that was technical support until recently, but it could now become a hurdle.

The uncertainty caused by the Italian elections continues to weigh on stocks in Europe. The FTSEurofirst-300 index of top European shares closed down 1.4 percent. The benchmark Italian index tumbled 4.9 percent.

Home Depot gave the biggest boost to the Dow and provided one of the biggest lifts to the S&P 500 after the world’s largest home improvement chain reported adjusted earnings and sales that beat expectations. The stock climbed 5.6 percent to $ 67.47.

Macy’s shares gained 3.6 percent to $ 39.90 after the department-store chain stated it expects full-year earnings to be above analysts’ forecasts because of strong holiday sales.

Economic reports that showed strength in housing and consumer confidence also supported stocks. U.S. home prices rose more than expected in December, according to the S&P/Case-Shiller index. Consumer confidence rebounded in February, jumping more than expected, and new-home sales rose to their highest in 4-1/2 years.

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Reuters: Financial Services and Real Estate

US STOCKS-Wall St rebounds as Bernanke defends policy

US STOCKS-Wall Street drops as energy sector drags

Wed Feb 20, 2013 2:47pm EST

* Energy shares weak after results, oil down 2.3 pct

* Housing shares drop after Toll Bros results

* Office Depot and OfficeMax confirm merger, Staples slumps

* Boeing rallies after Reuters report on battery issue

* Dow off 0.3 pct, S&P 500 off 0.6 pct, Nasdaq off 0.8 pct

By Edward Krudy

NEW YORK, Feb 20 (Reuters) – U.S. stocks fell on Wednesday, pressured by a drop in energy shares as investors found few reasons to buy equities following a rally that has propelled indexes close to all-time highs.

Stocks were volatile after minutes from the U.S. Federal Reserve suggested the central bank may have to slow or stop buying assets before seeing a pickup in hiring, raising the prospect of an earlier end to quantitative easing.

“What Wall Street wants to hear is an absolute sign that the Fed will continue with QE for the indefinite future. When it says we may end it faster, that just raises the uncertainty and the market hates that,” said Todd Schoenberger, managing partner at Landcolt Capital in New York.

Energy companies’ shares were among the weakest, hurt by disappointing results in the sector and a 2.3 percent drop in crude oil prices. The Energy Select Sector SPDR exchange-traded fund fell 1.2 percent.

The Dow Jones industrial average slipped 36.65 points, or 0.26 percent, to 13,999.02. The Standard & Poor’s 500 Index dropped 9.50 points, or 0.62 percent, to 1,521.44. The Nasdaq Composite Index lost 24.63 points, or 0.77 percent, to 3,188.96.

In the energy sector, Newfield Exploration tumbled 7.7 percent to $ 25.19 while Devon Energy Corp dropped 4.6 percent to $ 57.75. Both companies posted fourth-quarter losses, with Devon hurt as it wrote down the value of its assets by $ 896 million because of weak natural gas prices.

Equities have been strong recently. The day’s modest decline was the largest for the S&P 500 since Feb. 4. The index has jumped about 7 percent so far this year and is on track for its eighth straight week of gains.

However, many of those weekly gains have been slight, with equities trading within a narrow range for the past few weeks, suggesting valuations may be stretched at current levels.

“The market seems very tired and listless, and investors are prone to take profits now as they wait for the music to stop,” said Matt McCormick, money manager at Bahl & Gaynor in Cincinnati.

Earlier in the day, unconfirmed rumors that a troubled hedge fund was selling assets added some downward pressure to the market. The rumors appeared to be unfounded.

“I heard the chatter about a hedge fund liquidating things today but how big, I don’t know. Certainly, it sparks concern,” said Michael James, senior trader at Wedbush Morgan in Los Angeles.

Housing shares also declined, pressured by weaker-than-expected results at Toll Brothers Inc and a drop in groundbreaking to build new U.S. homes, also known as housing starts, in January.

Toll Brothers’ stock fell 6.1 percent to $ 34.66, but is up about 7 percent so far this year, building on a jump of nearly 60 percent in 2012. The Dow Jones U.S. Home Construction index lost 4.3 percent.

“Valuations appear a bit high at these levels, and if I was in a name that had seen a huge run, I’d want to take some chips off the table,” said McCormick, who helps oversee about $ 8.2 billion in assets.

The Dow’s losses were limited by Boeing Co, up 1.2 percent at $ 75.56 after a source told Reuters that the company had found a way to fix battery problems on its grounded 787 Dreamliner jets. Concerns over that line have weighed on Boeing recently, contributing to a 2 percent drop in the stock’s price in January.

In economic data released on Wednesday, permits for future home building rose in January to a 4 1/2-year high while a separate report showed wholesale prices rose last month for the first time in four months. The U.S. Producer Price Index rose in January for the first time in four months.

Shares of OfficeMax Inc fell 8.5 percent to $ 11.87 while Office Depot slid 18.5 percent to $ 4.09 as the companies announced a $ 1.2 billion merger agreement. The shares had surged in Tuesday’s session after a source said a deal would be announced. Rival Staples Inc fell 5.5 percent to $ 13.84 and ranked as one of the S&P 500′s biggest decliners.

According to Thomson Reuters data through Tuesday morning, of the 405 companies in the S&P 500 that have reported results so far, 71 percent have exceeded analysts’ expectations, compared with a 62 percent average since 1994 and 65 percent over the past four quarters.

Fourth-quarter earnings for S&P 500 companies are estimated to have risen 5.7 percent, according to the data, exceeding a forecast for a 1.9 percent gain at the start of the earnings season.

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Reuters: Financial Services and Real Estate

US STOCKS-Wall Street drops as energy sector drags

US STOCKS-Wall St ticks lower, investors seek new catalysts

Mon Feb 11, 2013 2:40pm EST

* Google shares dip, executive to sell nearly half his stake

* Fed’s Yellen says Fed taking ‘forceful action’ on economy

* Moody’s rises in rebound off week of steep decline

* Dow off 0.2 pct; S&P off 0.1 pct; Nasdaq off 0.2 pct

By Ryan Vlastelica

NEW YORK, Feb 11 (Reuters) – U.S. stocks fell modestly on Monday as investors found few reasons to keep pushing shares higher following a six-weeks-long advance that has taken the S&P 500 index near record highs.

The benchmark index is up more than 6 percent so far this year after a steep rally in January that has stalled as the S&P and Dow industrials near multi-year highs.

“This is still a market that looks terrific, but when you’re up for six weeks in a row, everyone is going to want to take a pause going into the seventh week even if there is no bad news out there,” said Eric Kuby, chief investment officer at North Star Investment Management in Chicago.

The S&P 500 would need to rise 3.9 percent to reach its all-time intraday high of 1,576.09, which was hit in October 2007.

Google Inc shares fell 1 percent at $ 777.67 after the company said in a filing former chief executive Eric Schmidt is selling roughly 42 percent of his stake in the Internet search giant, a move that could potentially net him $ 2.51 billion.

But the decline was offset by gains in Apple, up 1.4 percent at $ 481.73 after a New York Times report that the iPhone maker is experimenting with the design of a device similar to a wristwatch.

The Federal Reserve’s Vice Chair Janet Yellen, seen as a potential successor to Fed Chairman Ben Bernanke next year, said the Fed is still aggressively stimulating an anemic U.S. economic recovery that has failed to bring rapid progress on employment.

The Dow Jones industrial average was down 31.05 points, or 0.22 percent, at 13,961.92. The Standard & Poor’s 500 Index was down 1.80 points, or 0.12 percent, at 1,516.13. The Nasdaq Composite Index was down 5.25 points, or 0.16 percent, at 3,188.62.

Upbeat U.S. and Chinese data last week helped the S&P 500 extend its weekly winning streak to six. The index gained about 8 percent over that period.

Equities have been strong performers lately, rising 6.3 percent so far this year. Many investors have used any declines in the market as opportunities to buy.

“Everyone wants to buy on a dip in this market, but if you’re on the sidelines right now, the decline we’re seeing today just isn’t the kind you would jump in on,” Kuby said.

President Barack Obama will describe his plan for spurring the economy in his State of the Union address on Tuesday. He is expected to offer proposals for investment in infrastructure, manufacturing, clean energy and education.

Opposition has grown to the $ 24.4 billion buyout of Dell Inc , the No. 3 personal computer maker, as three of the largest investors joined Southeastern Asset Management on Friday in raising objections. Dell said in a regulatory filing it had considered many strategic options before opting to go private in a buyout led by Chief Executive Michael Dell.

Dell shares hovered near $ 13.65, the buyout offer price.

Regeneron Pharmaceuticals Inc shares rose 1.6 percent at $ 168.72 after it said longtime drug development partner Sanofi plans to boost its stake.

Moody’s Corp was one of the strongest percentage gainers on the S&P 500, rising 3.9 percent to $ 45.06. Last week the stock plunged 22 percent after the U.S. government launched a civil lawsuit against the company. The sell-off marked the stock’s worst week since October 2008.

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Reuters: Financial Services and Real Estate

US STOCKS-Wall St ticks lower, investors seek new catalysts