MARKET SNAPSHOT: U.S. Stocks Rise As Europe Worries Fade

Date : 09/08/2010 @ 10:11AM
Source : Dow Jones News
Stock : Talbots (The) (TLB)
Quote : 2.76  0.0 (0.00%) @ 2:05AM

MARKET SNAPSHOT: U.S. Stocks Rise As Europe Worries Fade

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By Jonathan Cheng

U.S. stocks bounced back from the previous day's declines as concerns about European bank health subsided.

The Dow Jones Industrial Average (DJI) added 50 points, or 0.5%, to 10390 in early trading, with financial stocks among the strongest performers. The Standard & Poor's 500-stock index (SPX) advanced 5 points to 1097 while the Nasdaq Composite (RIXF) rose 13 points to 2,222.

The blue-chip Dow index had dropped 1% on Tuesday, snapping a four-session winning streak.

Wednesday's rebound came after the Portuguese government sold 661 million euros ($839 million) of three-year debt and 378 million euros of 10-year bonds, amid solid demand.

The successful auction helped ease short-term concerns about euro-zone sovereign debt that had crept to the forefront a day earlier, after a Wall Street Journal report renewed concerns about European banks' sovereign debt holdings.

The auction also helped offset weaker-than-expected economic data, which showed Germany's exports dropping in July from the previous month, while industrial production edged up a meager 0.1%.

After the Portuguese auction, European stock markets turned higher to erase earlier losses, with the broad Stoxx Europe 600 index rising 0.7% in intraday trade.

Also performing strongly were energy stocks, which was the strongest of the S&P 500's 10 sectors. Shares of BP PLC (BP) rallied 3.6% in early trading after an internal report said "a sequence of failures involving a number of different parties" led to the explosion and fire that sparked this year's environmental disaster in the Gulf of Mexico.

"It is evident that a series of complex events, rather than a single mistake or failure, led to the tragedy," said BP's outgoing chief executive, Tony Hayward. "Multiple parties, including BP, Halliburton Co. (HAL) and Transocean Ltd. (RIG), were involved." Halliburton gained 0.7% while Transocean added 1.5%.

Crude-oil futures edged up to over $74 a barrel in electronic trading on Globex as oil traders awaited oil supplies data from the American Petroleum Institute, a day later than usual because of Labor Day.

Talbots (TLB) dropped 9.4% after the clothing chain reported quarterly results that disappointed investors.

Most Asian stock markets ended lower on Wednesday, with Japan's Nikkei Stock Average index dropping 2.2%. Treasurys fell slightly.

Investors will be awaiting the Federal Reserve's Beige Book of regional economic activity at 2 p.m., EDT, while looking to consumer credit numbers, slated for release at 3 p.m., EDT.

Treasurys fell broadly, with the yield on the benchmark 10-year note rising to 2.65%. The euro gained modestly on the dollar, while the Canadian dollar surged after the Bank of Canada raised interest rates by 25 basis points to 1%.

Gold advanced to $1,262.70 an ounce, one day after safe-haven demand helped the metal surge to a new settlement high.


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