Member access

4-Traders Homepage  >  News

News

Latest NewsCompaniesMarketsEconomy & ForexCommoditiesHot NewsMost Read NewsRecomm.Business LeadersVideosCalendar 

U.S. Stocks Rebound as H-P, AIG Rally; DJIA Little Changed on Week

02/22/2013 | 03:57pm US/Eastern

--U.S. stocks gain after two-day drop

--German business confidence tops expectations

--H-P, AIG rally after reporting quarterly results

 
  By Matt Jarzemsky 
 

Stocks rebounded from their biggest two-day slump of the year, as Hewlett-Packard and American International Group rallied on earnings and a reading on German business confidence topped expectations.

The Dow Jones Industrial Average advanced 92 points, or 0.7%, to 13973 in late-afternoon trading Friday, reversing much of a 155-point slide from the prior two days.

The Standard & Poor's 500-stock index tacked on 10 points, or 0.7%, to 1512. The Nasdaq Composite Index rose 23 points, or 0.7%, to 3154.

"Any selloff we get is going to be shallow," said Scott Wren, senior equity strategist at Wells Fargo Advisors, which manages $1.2 trillion in St. Louis. "The mentality is, 'I want to wait for the market to pull back so I can buy stocks at lower levels.' The Fed's on our side, companies are making money and the growth environment is OK."

Hewlett-Packard led the Dow higher, jumping 13% after the technology company late Thursday reported a quarterly profit that topped analysts' expectations and gave a better-than-expected earnings forecast.

AIG rose 2.6% after saying late Thursday that it swung to a loss, but operating profit--which excludes certain items--exceeded analyst expectations.

The Dow was set to finish the week little changed, while the S&P 500 was on pace to snap a seven-week streak of weekly gains.

Weighing on the benchmarks this week, minutes from the Federal Reserve's latest policy meeting released Wednesday showed some officials were concerned about the consequences of low-interest-rate policies meant to help revive the economy. That sparked U.S. stocks' biggest two-day selloff of the year, as such policies have been a boon to equities. But strategists said the pullback also set the stage for Friday's rebound.

"In my mind, the market overreacted to what the Fed minutes said," Mr. Wren said. "[Fed officials] are going to leave rates low and they're going to be buying low-risk securities for quite a while."

European markets rose, with the Stoxx Europe 600 up 1.3% to recover most of the losses from the previous session, after data showed German business confidence increased much more than expected in February. The index advanced 0.4% on the week.

Germany's DAX index climbed 1% and gained 0.9% for the week. The measure is up 0.7% this year.

"From the U.S. perspective, Germany is a very industrial and export-oriented economy. If they're seeing optimism on their order books, then there's reason to be optimistic globally," said Wasif Latif, vice president of equity investments at USAA Investments in San Antonio, whose firm manages $54 billion.

Elsewhere, Italy's FTSE MIB index advanced 1.4%. The index had fallen this week to close Thursday at a two-month low ahead of general elections in Italy this weekend. Some investors fear a new government may not continue the country's reformist path.

In Asia, China's Shanghai Composite fell 0.5% to a one-month low and declined 4.9% on the week. Hong Kong's Hang Seng Index also shed 0.5%, dropping 2.8% for the week, to near a two-month low. Investors are concerned that policy makers will implement additional tightening measures to control residential property prices.

Japan's Nikkei Stock Average gained 0.7% and climbed 1.9% on the week. The index has risen 14 of the past 15 weeks and has climbed 9.5% this year. Australia's S&P/ASX 200 added 0.8%, rebounding from losses on Thursday, but fell 0.3% on the week, snapping a five-week winning streak.

Crude-oil prices rose 0.3% to settle at $93.13 a barrel, while gold retreated 0.4% to settle at $1,572.40 a troy ounce. The dollar rose against the yen and euro. The 10-year Treasury note edged up in price, pushing its yield down to 1.965%.

In other corporate news, Cabot Oil & Gas jumped 10% after the natural-gas producer's earnings climbed 55% on higher production.

Texas Instruments advanced 4.8% after the chip maker unveiled a 33% increase in its quarterly dividend late Thursday and increased its stock-repurchase authorization by $5 billion.

Abercrombie & Fitch slipped 5.6% after giving an earnings forecast that lagged analysts' projections and saying it expects to close 40 to 50 stores in the U.S. in 2013.

Vivus dropped 2.9% after the pharmaceutical company said Thursday that a European Medicines Agency committee backed an earlier decision in which the panel recommended against approval of its weight-loss drug.

WebMD Health surged 26% after the health-information provider's adjusted fourth-quarter earnings and revenue beat analyst estimates late Thursday and its 2013 earnings outlook topped forecasts.

-Write to Matt Jarzemsky at matthew.jarzemsky@dowjones.com

React to this article
Latest news
Date Title
5m ago DOGAN SIRKETLER GRUBU : 5 Syrians killed in carbon monoxide poisoning in southern Turkey
10m ago KENYA AIRWAYS : KQ board queried over loss-making streak
11m ago PETROLEO BRASILEIRO PETROBRAS : CMM Contracts Damen for Five OSRV's
11m ago GAZPROM : Sets Up Department of Stock Exchange Operations
11m ago RAMPART ENERGY : Acquires Majority Stake in WA-507-P Permit
11m ago AVEVA : Wison Selects AVEVA Marine to Support Offshore Projects
11m ago GAZPROM : & BASF Address Progress with Asset Swap Deal
11m ago GP STRATEGIES : Wins Training Contract in South Africa
11m ago PETROLEO BRASILEIRO PETROBRAS : Abreu e Lima Initiates Atmospheric Distillation Unit
11m ago ELECTROMAGNETIC GEOSERVICES ASA : EMGS Awarded Contract in Brazil
Latest news
Advertisement
Hot News 
SNOOZEBOX : Providing Temporary Hotel For Premier Oil
FAIRFX : Taps John Pearson To Replace Co-Founder As Chairman (ALLISS)
MOL GLOBAL : ATTENTION MOL GLOBAL SHAREHOLDERS: Shareholder Rights Law Firm Johnson & Weaver, LLP Announces Investigation of MOL Global, Inc.
S&P 500 MOVERS : Gme, rost
FULLER SMITH & TURNER : Pub operator Fuller's first-half profit rises 8 pct
Most Read News
1d ago KATE SPADE : 13 Super Cozy Things on Sale
1d ago Lockheed, Pentagon ink $4.7 billion deal for eighth batch of F-35 fighters
1d ago European Parliament may propose Google break-up in draft resolution
1d ago VISA : sees Visa Europe option now costing more than $10 billion
1d ago ALDAR PROPERTIES PJSC : Demand for units in Abu Dhabi's tallest tower remains strong
Most recommended articles
1d ago WEEKLY TRADING FORECAST : Volatility Keeps Boiling in the FX Market
1d agoDJWireless Carriers Bid Up US Airwaves To Record
1d ago Dollar May Not Have a Quiet Thanksgiving...
1d agoDJGRAIN HIGHLIGHTS : Top Stories of the Day
1d ago Giving thanks for big stock gains
Dynamic quotes  
ON
| OFF