Stock Market News for February 20, 2013 - Market News
February 20 2013 - 4:36AM
Zacks
Major indices finished in the green
following encouraging mergers & acquisitions news. The Dow
Jones is just 0.9% short of its all-time high which was achieved in
October 2007. President Barack Obama addressed the nation on
Tuesday regarding the “spending cuts” which would be implemented
from March. Among the top ten S&P 500 industry groups, energy
stocks were the biggest gainer while the materials sector was the
only loser.
The Dow Jones Industrial Average
(DJI) increased 0.4% to close the day at 14,035.67. The S&P 500
increased 0.7% to finish yesterday’s trading session at 1,530.94.
The tech-laden Nasdaq Composite Index gained 0.7% to end at
3,213.59. The fear-gauge CBOE Volatility Index (VIX) decreased 1.2%
to settle at 12.31. Consolidated volumes on the New York Stock
Exchange, American Stock Exchange and Nasdaq were roughly 5.9
billion shares, below the daily average of 6.45 billion shares in
2012. Advancing stocks outnumbered the declining stocks. For the
66% that advanced, 31% declined.
Benchmarks finished yesterday’s
trading session on a positive note due to optimism created by
developments on the mergers & acquisitions front. According to
the Wall Street Journal, Office Depot Inc (NYSE:ODP) and OfficeMax
incorporated (NYSE:OMX) entered into negotiations for a merger.
Shares of Office Depot increased 9.4%, while OfficeMax surged
almost 21%. This development comes after Berkshire Hathaway Inc.
(NYSE:BRK.A) and a partner decided to buy H.J. Heinz Company
(NYSE:HNZ) last week.
On Tuesday, President Barack Obama
gave a speech on reducing government spending. The President said
that if spending cuts of $1.2 trillion are allowed then it would
directly affect investments in energy and medical research,
military spending and increase unemployment significantly.
According to his State of the Union speech, he intends to bring
about investments and increase employment in the country, but a
“meat cleaver” approach to these issues could just do the
opposite.
The President added if lawmakers
are unable to decide by next Friday, “At minimum, Congress should
pass a smaller package of spending cuts and tax reforms ... to give
them time to work together on a plan that finishes the job of
deficit reduction in a sensible way.”
On the earnings front, shares of
Express Scripts Holding Company (NASDAQ:ESRX) surged 2.5%. Profits
of the company surged 74% year over year; beating the Street’s
expectations. The company guided adjusted earnings per share for
fiscal 2013 in the range of $4.20 and $4.30. According to Thomson
Reuter’s data, 391 companies in S&P 500 have reported their
results, among which 70.1% have topped the Street’s estimates.
According to the Centre of European
Economic Research (ZEW), the ZEW institute’s index increased to
48.2 in February from previous month’s 31.5. The index beat
consensus expectations of 36 points. The German economy contracted
by 0.6% in the fourth quarter, increasing fears of further
recession. However, economists believe the contraction was just a
brief phase and that the economy will bounce back quickly.
The energy sector emerged as the
biggest gainer among the S&P 500 industry groups. The Energy
Select Sector SPDR (XLE) gained 1.2%. Stocks such as Exxon Mobil
Corporation (NYSE:XOM), Chevron Corporation (NYSE:CVX), Marathon
Oil Corporation (NYSE:MRO), Suncor Energy Inc. (NYSE:SU) and Hess
Corp. (NYSE:HES) gained 1.1%, 0.8%, 3.0%, 0.6% and 1.2%,
respectively.
The materials sector was the only
loser among the S&P 500 industry groups and the Materials
Select Sector SPDR (XLB) lost 0.4%. Stocks such as Monsanto Company
(NYSE:MON), Ceres Inc (NASDAQ:CERE), FMC Corporation (NYSE:FMC) and
Celanese Corporation (NYSE:CE) declined 1.6%, 1.4%, 0.3% and 0.8%,
respectively.
BERKSHIRE HTH-A (BRK.A): Free Stock Analysis Report
CELANESE CP-A (CE): Free Stock Analysis Report
CERES INC (CERE): Free Stock Analysis Report
CHEVRON CORP (CVX): Free Stock Analysis Report
EXPRESS SCRIPTS (ESRX): Free Stock Analysis Report
FMC CORP (FMC): Free Stock Analysis Report
HESS CORP (HES): Free Stock Analysis Report
HEINZ (HJ) CO (HNZ): Free Stock Analysis Report
MONSANTO CO-NEW (MON): Free Stock Analysis Report
MARATHON OIL CP (MRO): Free Stock Analysis Report
OFFICE DEPOT (ODP): Free Stock Analysis Report
OFFICEMAX INC (OMX): Free Stock Analysis Report
SUNCOR ENERGY (SU): Free Stock Analysis Report
EXXON MOBIL CRP (XOM): Free Stock Analysis Report
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