July 16th 2014 – Dow Reaches 15th Record-High Close Of The Year
Market View:
With great reports and the Fed being pleased with the moderate growth of the economy we had a bounce today. It did get a kick up at the open after a positive overnight report on growth from China.
So, technology rebounded after yesterdays dip caused by Janet Yellen’s comments. News of mergers and deals between some of the biggest companies is always cheered on Wall Street.
The market is making another wave up yet the S&P 500 has yet to make a new all time high unlike the Dow and the Nasdaq. I suspect that the S&P will reach it either this week or next. Where the next intermediate top it no one knows.
Market News:
U.S. stocks climbed on Wednesday, again lifting the Dow industrials into uncharted terrain, with investor sentiment lifted by corporate earnings and deals.
Equities maintained near session highs with the release of the Federal Reserve’s Beige Book, which found the economy expanding at a modest to moderate pace, with consumer spending up in all of the Fed’s districts.
Technology shares rallied in the wake of earnings from Intel, with the chip maker forecasting third-quarter revenue above Wall Street’s estimates late Tuesday.
Time Warner shares shot higher after CNBC reported it had rejected a $80 billion takeover bid by 21st Century Fox, which confirmed making an offer for Time Warner, but also said the companies were not currently in discussions.
Apple and International Business Machines gained after saying they would jointly develop applications for business users and mobile devices.
After a 78-point jump to an intraday record 17,139.35, the Dow Jones Industrial Average rose 77.52 points, or 0.5 percent, to 17,138.20, a record close, with technology giants Intel, Microsoft, IBM and Cisco Systems leading blue-chip gains.
Not far from its record high, the S&P 500 advanced 8.29 points, or 0.4 percent, to 1,981.57, with energy and technology pacing gains and health care and financials the largest laggards among its 10 major sectors.
The Nasdaq rose 9.58 points, or 0.2 percent, to 4,425.97.
On Capitol Hill, U.S. Federal Reserve Chair Janet Yellen concluded a second day of congressional testimony, where she faced a barrage of questions from Republican lawmakers about legislation to make the Fed more accountable.
Dallas Fed President Richard Fisher on Wednesday said the Fed would likely start hiking interest rates early next year, if not sooner.
Ahead of Wednesday’s open, stock futures gained after a report showed China’s second-quarter economic growth coming in above expectations; with futures retaining gains after the government reported U.S. producer prices rose 0.4 percent in June, versus expectations of a 0.2 percent increase.
Another report had U.S. factory output increasing for a fifth month in June as manufacturers cranked out more aircraft, chemicals and furniture.
And, a monthly survey from the national Association of Home Builders rose 4 points in July to 53, crossing the line into positive territory.
The financial sector on Wednesday was among those declining, hit by Bank of America, which fell after reporting a drop of 43 percent in second-quarter profit and a 10-cent miss on earnings per share. The Wall Street Journal citing people familiar with the matter in reporting the bank had offered $13 billion to settle a Justice Department probe into mortgage securities it sold.
Global market overview: European markets bounced about 1% higher, encouraged by China’s growth figures. Asian markets also largely closed higher.
Thursday:
Earnings: IBM, Google, Morgan Stanley,Blackstone,KeyCorp,AutoNation, Novartis, SAP, Philip Morris,UnitedHealth,Baker Hughes,Capital One, Celanese, Cypress Semi,Sherwin-Williams, Danaher,Canadian Pacific Railway, Seagate Technologies
830 a.m.: Initial claims
8:30 a.m.: Housing starts
10:00 a.m.: Philadelphia Fed survey
News Sources: CNBC and CNN Money