Stock Market News for February 18, 2015 – Zacks Investment …
Benchmarks started the holiday-shortened week on a positive note banking on encouraging news from Greece. Indications that the Greek government intends to seek an extension of the country’s loan agreement program improved sentiment. While the S&P 500 closed at an all-time record high, the Dow closed at the highest level so far this year. Markets were closed on Monday for Presidents’ Day holiday.
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) gained 0.2%, to close at 18,047.58. The Standard & Poor 500 (S&P 500) too rose 0.2% to 2,100.34. The tech-laden Nasdaq Composite Index closed at 4,899.27; increasing 0.1%. The fear-gauge CBOE Volatility Index (VIX) surged 7.6% to settle at 15.80. A total of about 3.8 billion shares were traded on NYSE on Tuesday. Advancers outpaced declining stocks on the NYSE. For 60% stocks that advanced, 36% declined.
Reportedly, Greece intends to seek for an extension of the country’s loan agreement on Wednesday. The extension on its debt obligations could be between four to six months. This will give Greece an additional time to negotiate a new bailout program with its creditors. However, conditions for request of new rescue deal were still under negotiations. The current deal is about to expire this month.
Meanwhile, Greek Prime Minister Alexis Tsipras said: “A loan agreement is different from a bailout…. We’re examining the possibility of requesting an extension of the loan agreement, clearly differentiating it from the program”. He also said that Greece “Won’t accept an ultimatum but will negotiate as an equal partner”.
Talks between Greece’s new anti-austerity government and Eurozone finance ministers had failed on Monday. The European Union finance ministers insisted on keeping austerity measures as part of the condition for extending the bailout program. Greece has to abide by budget cuts or economic overhauls that were applied in the existing bailout program. Greece said these measures were hurting its economy. Further, Greece claimed the European Union finance ministers haven’t given them much flexibility in implementing these measures.
Coming to domestic events, the Health Care Select Sector SPDR (XLV) was the biggest gainer among the S&P 500 sectors. The sector advanced 0.7%. The healthcare sector was bolstered by gains in bio-tech stocks. Shares of bio-tech companies such as Amgen Inc. (AMGN – Analyst Report), Biogen Idec Inc. (BIIB – Analyst Report), Celgene Corporation (CELG – Analyst Report) and Regeneron Pharmaceuticals, Inc. (REGN – Analyst Report) increased 0.5%, 1.6%, 0.4% and 0.4%, respectively.
The SPDR S&P Homebuilders ETF (XHB) gained 0.5%, the second highest among the S&P 500 sectors. Housing stocks such as Lennar Corp. (LEN – Analyst Report), DR Horton Inc. (DHI – Analyst Report), Toll Brothers Inc. (TOL – Analyst Report) and Beazer Homes USA Inc. (BZH – Snapshot Report) increased 0.9%, 0.7%, 0.3% and 0.9%, respectively. Overall, 8 out of 10 sectors of the S&P 500 ended in the green.
In earnings news, The Goodyear Tire & Rubber Company (GT – Analyst Report) reported fourth quarter 2014 earnings per share of 59 cents, more than the Zacks Consensus Estimate of 58 cents. However, revenues of $4.36 billion were less than the Zacks Consensus Estimate of $4.39 billion. Medtronic plc (MDT – Analyst Report) posted third-quarter fiscal 2015 earnings per share of $1.01, ahead of the Zacks Consensus Estimate by 4 cents. Revenues in the reported quarter were $4.318 billion, more than the Zacks Consensus Estimate of $4.260 billion. Shares of Goodyear Tire & Rubber and Medtronic went up 2.7% and 3.7%, respectively.
Economic data on manufacturing and housing was disappointing. The Empire State Manufacturing Survey Index came in at 7.78 in February, declining from 9.95 in January. However, the reading was more than the consensus estimate of fall to 6.75. The reading indicated that manufacturing activity moved lower but still remained in positive territory for New York manufacturers.
Additionally, the NAHB/Wells Fargo Housing Market index slipped 2 points to 55 in February from January’s reading. However, NAHB chief economist David Crowe stated: “For the past eight months, confidence levels have held in the mid- to upper 50s range, which is consistent with a modest, ongoing recovery”. He added: “Solid job growth, affordable home prices and historically low mortgage rates should help unleash growing pent-up demand and keep the housing market moving forward in the year ahead.”
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Stock Market News for February 18, 2015 – Zacks Investment …
