Stock Market News for March 23, 2015 – Zacks Investment Research
Benchmarks ended in the green on Friday as weaker dollar and encouraging earnings results from Nike boosted investor sentiment. Weaker dollar had a positive impact on oil prices, which in turn helped energy shares move up. The Nasdaq reached a 15-year high and finished above 5k mark on Friday. Moreover, the S&P 500 registered weekly gains for the first time in four weeks and the Dow posted the same in last three weeks.
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The Dow Jones Industrial Average (DJI) gained more than 0.9%, or 168.62 points, to close at 18,127.65. The Standard & Poor’s 500 (S&P 500) jumped 0.9% to 2,108.10. The tech-laden Nasdaq Composite Index closed at 5,026.42; increasing 0.7%. The fear-gauge CBOE Volatility Index (VIX) declined 7.5% to settle at 13.02. A total of about 9.9 billion shares were traded on Friday, higher than the month-to-date average of 6.6 billion. Advancers outpaced declining stocks on the NYSE. For 77% stocks that advanced, 20% declined.
On Friday, the U.S. dollar declined against most major currencies as the Fed’s dovish stance regarding raising interest rate continued to encourage market participants. The Fed may opt for a gradual pace of rate hike. The FOMC minutes noted last week that a rate hike was “unlikely” in April and will only consider a possible rate hike if the central bank feel ‘reasonably confident’ about economic improvement.
The U.S. dollar index, which evaluates the performance of the greenback against a group of currencies, declined nearly 1.4%, witnessing its sharpest decline since Sep 2013. The euro gained 1.4% to $1.0811 and the yen jumped over 0.6% against the U.S. dollar. Meanwhile, the dollar index witnessed its biggest weekly decline since 2011 and the euro registered biggest weekly gain against the dollar in about three years.
Separately, shares of Nike, Inc. (NKE – Analyst Report) climbed 3.7% after posting solid third-quarter fiscal 2015 results after the closing bell on Thursday. The company’s quarterly earnings of 89 cents per share surged 18.7% year over year and outpaced the Zacks Consensus Estimate of 84 cents. Moreover, net sales advanced about 7% to $7,460 million in the third quarter. However, the company warned that foreign exchange headwinds may have a negative impact on fourth quarter results. Nike was the best performer among the blue chip components.
Meanwhile, Darden Restaurants, Inc.’s (DRI – Analyst Report) shares gained 2.9% after announcing third quarter fiscal 2015 earnings from continuing operations of 99 cents per share, beating the Zacks Consensus Estimate of 84 cents. However, shares of Tiffany & Co. (TIF – Analyst Report) declined nearly 4% after reporting fourth quarter net sales of $1,285.3 million that fell short of the Zacks Consensus Estimate of $1,311 million. Net sales also declined 1% year on year due to sluggishness witnessed across the Americas and Japan, partially offset by strength seen in the Asia-Pacific region.
Meanwhile, weaker dollar helped the prices of WTI crude oil and Brent crude oil to gain 3.9% and 1.6% to $45.72 per barrel and $55.32 a barrel, respectively. Rise in oil prices boosted the Energy Select Sector SPDR (XLE) on Friday. The sector increased 1.5% and was the second biggest gainer among the S&P 500 sectors. Key energy stocks including EOG Resources, Inc. (EOG – Analyst Report), Chevron Corporation (CVX – Analyst Report), Halliburton Company (HAL – Analyst Report) and Schlumberger Limited (SLB – Analyst Report) gained 1.3%, 2.2%, 3.1% and 1.7%, respectively. All of the S&P 500 sectors gained on Friday.
Over the week, the Dow, S&P 500 and Nasdaq rose 2.1, 2.7% and 3.2%, respectively.
Benchmarks finished a volatile week with solid gains banking on the Fed’s encouraging statement that reduced fears regarding a sooner-than-expected rate hike. The unexpectedly dovish stance of the Federal Reserve helped benchmarks close higher on Wednesday. The Fed’s go-slow approach to raise rates came in the backdrop of a slowdown in economic growth in early 2015.
Moreover, the ups and downs in dollar value against major currencies affected benchmarks throughout the week. Meanwhile, encouraging earnings results from Guess’ Inc. (GES – Analyst Report) and Oracle Corporation (ORCL – Analyst Report) boosted markets.
However, dismal economic data including initial claims, Philadelphia Federal Reserve’s manufacturing index, Empire State Manufacturing Survey Index, housing starts and capacity utilization dented investor confidence. Moreover, dismal earnings results including FedEx Corporation (FDX – Analyst Report) and Adobe Systems Incorporated (ADBE – Analyst Report) had a negative impact on the benchmarks.
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Stock Market News for March 23, 2015 – Zacks Investment Research
