Stock Market News for February 06, 2015 – February 6, 2015 – Zacks …
Rise in oil prices, new deals and upbeat quarterly results helped benchmarks settle in the green on Thursday. While rise in crude oil prices fueled gains in material and energy shares, Pfizer’s plan to acquire Hospira boosted healthcare stocks. Encouraging earnings results from O’Reilly Automotive and Estée Lauder Cos also added to the bullish sentiment. Meanwhile, investors shrugged off discouraging news emanating from Greece. The day’s gains helped push the S&P 500 and the Dow back into positive territory for the year.
For a look at the issues currently facing the markets, make sure to read today’s Ahead of Wall Street article
The Dow Jones Industrial Average (DJI) rose 1.2%, or 211.86 points, to close at 17,884.88. The Standard & Poor 500 (S&P 500) gained 1% to close at 2,062.52. The tech-laden Nasdaq Composite Index closed at 4,765.10; rising 1%. The fear-gauge CBOE Volatility Index (VIX) plunged 8.1% to settle at 16.85. A total of about 6.9 billion shares were traded on Thursday, below last five sessions’ average of 8.1 billion. Advancers outpaced declining stocks on the NYSE. For 74% stocks that advanced, 24% declined.
China’s central banks’ monetary easing program, which is expected to boost oil demand, along with rise in violence in an oilfield in Libya helped oil prices move north on Thursday. Prices of WTI crude oil gained 4% to $50.48 per barrel. Additionally, Brent crude oil increased 4.3% to settle at $56.57 a barrel.
Rise in oil prices had a positive impact on both material and energy shares. The Materials Select Sector SPDR (XLB) advanced 2.4%. The sector was the biggest gainer among the S&P 500 sectors. Key materials stocks including Freeport-McMoRan Inc. (FCX – Analyst Report), Alcoa Inc. (AA – Analyst Report), The Dow Chemical Company (DOW – Analyst Report) and Monsanto Company (MON – Analyst Report) increased 7.1%, 3.9%, 3.4% and 1.5%, respectively.
The Energy Select Sector SPDR (XLE) gained 1.4%, the second highest among the S&P 500 sectors. Dow components Exxon Mobil Corporation (XOM – Analyst Report) and Chevron Corporation (CVX – Analyst Report) both advanced 0.9%. Other key stocks from the sector including Schlumberger Limited (SLB – Analyst Report), Kinder Morgan, Inc. (KMI – Analyst Report), ConocoPhillips (COP – Analyst Report) and EOG Resources, Inc. (EOG – Analyst Report) increased 1.6%, 1.7%, 2.6% and 1.1%, respectively.
Meanwhile, Pfizer Inc. (PFE – Analyst Report) agreed to acquire Hospira Inc. (HSP – Analyst Report) in an all-cash deal valued at $16 billion. Pfizer agreed to buy the maker of injectable drugs since the global market value for such drugs is estimated to be $70 billion by 2020. Shares of Pfizer and Hospira increased 2.9% and 35.3%, respectively.
Pfizer’s plan to buy Hospira lifted healthcare stocks. Further, gains among bio-tech stocks also had a positive impact on healthcare sector. Shares of bio-tech companies such as Amgen Inc. (AMGN), Biogen Idec Inc. (BIIB), Vertex Pharmaceuticals Incorporated (VRTX), Celgene Corporation (CELG) and Regeneron Pharmaceuticals, Inc. (REGN) increased 1.3%, 2.7%, 2.1%, 2.9% and 3.1%, respectively. The broader Health Care Select Sector SPDR (XLV) gained 1.7%. Overall, all 10 sectors of the S&P 500 ended in the green.
Upbeat quarterly results from O’Reilly Automotive Inc. (ORLY) and The Estée Lauder Companies Inc. (EL) also had a positive impact on investor sentiment. O’Reilly Automotive reported fourth quarter 2014 earnings per share of $1.76 that beat the Zacks Consensus Estimate of $1.67. Quarterly revenues of $1.76 billion were also more than the Zacks Consensus Estimate of $1.74 billion. Estée Lauder posted second-quarter fiscal 2015 earnings per share of $1.13, more than the Zacks Consensus Estimate of $1.05. Quarterly net sales of $3.04 billion also beat the Zacks Consensus Estimate of $3.01 billion. Shares of O’Reilly Automotive and Estée Lauder both advanced 8.1%.
Meanwhile, investors choose to ignore discouraging news from Eurozone. Germany dismissed Greece’s plea for bridge funding till the end of May that will give the country some time to negotiate new bailout conditions. Greece’s current euro 240 billion bailout is about to expire by the end of this month. Germany’s dismissal came after the European Central Bank refused to accept Greek bonds as collateral for central bank loans.
Coming to domestic events, seasonally adjusted initial claims increased 11,000 to 278,000 in the week ending Jan 31. However, this rise in application for unemployment benefits was less than the consensus expectations of 293,000.
Separately, the goods and services deficit increased to $46.6 billion in December from $39.8 billion in November. Additionally, nonfarm business sector labor productivity declined 1.8% in the fourth quarter of 2014. The decrease was in contrast to the consensus expectation of a rise by 0.5%.
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Stock Market News for February 06, 2015 – February 6, 2015 – Zacks …
