After The Close - The major U.S. equity indexes were higher at the start of trading today and never looked back. Helping equities was a combination of positive quarterly earnings news and some more deals in the corporate world. That news seemed to push some of the geopolitical worries, particularly about the Middle East and Ukraine, which have had a negative impact on trading in recent days, to the backburner. Thus, at the closing bell, the Dow Jones Industrial Average, the NASDAQ, and the S&P 500 Index were 112, 25, and 10 points higher, respectively, with the index of 30 bellwether companies at one point flirting with finishing at an all-time high. The buying was encompassing, as both large- and—to a lesser extent—small-cap stocks fared well today. Overall, advancing issues were well ahead of decliners on both the New York Stock Exchange and the NASDAQ.

Most of the top-10 sectors finished comfortably in positive territory. Leadership came from the technology, energy, and telecommunications sectors, the latter of which has performed remarkably well over the last fortnight of trading. Within the technology sector, the stocks of the computer hardware and IT services companies were in demand. And, the energy sector, which has been a notable laggard the last few weeks, was helped by a strong showing from the shares of the integrated oil and gas companies. Conversely, only the utilities were notable lower at the closing bell. The basic materials also had a hard time staying above the neutral line over the course of the session, but some selective late-day buying pushed the materials comfortably into the black.

As noted, the day’s big earnings news came from Citigroup (C). The banking giant’s adjusted earnings and revenues came in better than expected and the company agreed to pay $7 billion to settle a federal investigation into the subprime mortgages it sold prior to the financial crisis in 2008. The Citigroup report also boosted the stocks of fellow investment banks Morgan Stanley (MS), Goldman Sachs (GS - Free Goldman Sachs Stock Report), and JPMorgan Chase (JPM - Free JPMorgan Stock Report). The latter two banks and Dow-30 members are scheduled to release their latest quarterly results tomorrow. As such, we expect the financial sector to remain very much on the minds of investors over the next few days.

The market also got a nice boost from another round of M&A activity, which many investors view as a sign of the market’s strength. Specifically, we learned that generic drugmaker Mylan (MYL) is buying Abbott Laboratories’ (ABT) generic operations for $5.3 billion; engineering design firm AECOM Technology (ACM) is acquiring engineering and construction services company URS Corp. (URS) for $4 billion; and Kindred Healthcare (KND) has increased its cash offer for shares of Gentiva Health Services (GTIV).

Looking ahead, tomorrow kicks off a heavy stretch of earnings and economic news. On the earnings front, four Dow-30 companies, including the aforementioned two investment banks and Intel (INTC - Free Intel Stock Report), will dominate the headlines. The Intel report, specifically the chipmaker’s outlook, will be closely monitored, especially with the stock moving nicely higher over the last month. On the business beat, investors will be focused on the latest data on retail sales, which will be released at 8:30 A.M. (EDT) tomorrow. Investors will have to digest all of this data, while keeping an eye on what Federal Reserve Chair Janet Yellen has to say before Congress at 10:00 A.M. The talk of monetary policy can often have an impact on trading. - William Ferguson

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.


12:30 PM EDT - The U.S. stock market opened higher today, and has been able to maintain its gains.  At about noon in New York, the Dow Jones Industrial Average is up 130 points; the broader S&P 500 Index is ahead 11 points; and the NASDAQ is advancing 30 points. There is clearly a favorable bias to today’s session, with advancing issues easily outnumbering decliners on the NYSE. Further, most equity sectors are pressing ahead. Leadership can be found in the technology, financial, and energy stocks. Meanwhile, the utilities are out of favor today, as investors may be turning to the faster-moving issues.

A strong session overseas probably helped trading in the U.S. this morning. Specifically, the Asian markets put in a solid showing overnight. And, in Europe, the major bourses traded higher. Notably, last week, investors turned their attention to the Continent, when banking problems in Portugal became an area of concern.

Notably, stocks are still showing some strength. Today’s move puts the Dow back above the 17,000 mark, which is likely an area to watch. Also, sentiment seems to be improving, as the VIX is trading lower to 11.52 today.

Traders received no notable economic news this morning. However, tomorrow will be a busier day for reports. Specifically, we will get a look at retail sales for the month of June, as well as business inventories for May.

Further, investors received limited earnings news today. However, Citigroup (C) stock is moving higher, after the banking giant put out a better-than-anticipated report. Tomorrow will be a busy day for corporate reports, as we will hear from J.P. Morgan Chase (JPM - Free JPMorgan Chase Stock Report), Goldman Sachs (GS - Free Goldman Sachs Stock Report), and Johnson & Jonson (JNJ).  In the afternoon, Intel (INTC - Free Intel Stock Report) and Yahoo! (YHOO) weigh in with their reports.

Meanwhile, there was some M&A news today and that may be helping lift the market. Shares of URS (URS) are up after that company agreed to be purchased by AECOM (ACM). Too, Mylan (MYL) stock is trading higher on news that the generic drug maker will purchase assets from Abbott (ABT). - Adam Rosner

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.


Stocks to Watch from The SurveyToday is the calm before the storm, as a host of high-profile companies will begin releasing second-quarter earnings at a furious pace starting tomorrow. This morning, investors are focused on Citigroup (C), one of the nation’s largest financial institutions. The bank reported better-than-expected adjusted earnings, as well as a $7 billion settlement with the U.S. Department of Justice regarding mortgage-backed securities that the company issued, structured, or underwrote between 2003 and 2008. The news sat well with investors, who have bid C stock moderately higher ahead of the bell.

There is also a bit of M&A news to be aware of this morning, especially in the healthcare sector. Notably, drugmaker Mylan (MYL) has agreed to purchase the international specialty and branded generics businesses of medical supplies company Abbott Laboratories (ABT) in an all-stock deal valued at roughly $5.3 billion. Both equities are moving modestly higher in the premarket, as a result. Too, drugmaker AbbVie (ABBV) appears closer to striking a deal to acquire industry peer Shire, after AbbVie sweetened its buyout offer. ABBV is indicating a modestly lower opening this morning. Elsewhere, URS Corp. (URS) has agreed to be acquired by fellow engineering and construction company AECOM Technology (ACM) for $56.31 a share in cash and stock. URS is up notably ahead of the bell, in response, and ACM is moving modestly higher, as well. Finally, shares of Whiting Petroleum (WLL) are also indicating a higher opening this morning, after the energy company struck a deal to purchase industry peer Kodiak Oil & Gas for about $3.8 billion.   – Matthew E. Spencer

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.


Before The Bell - The stock market weaved back and forth and accomplished little during the first half of Friday's session, spending much of the concluding session of the first full week of the second half just narrowly in the loss column. This ho-hum early performance was in contrast to what Wall Street experienced the day before when banking issues in Portugal and economic worries in Germany, France, and Italy had rattled the markets worldwide, before a late-day sense of calm finally returned.

On Friday, there were no such fireworks. Once again, the day was marked by the absence of economic releases, while profit reports were few in number, too, as we are still a day or two from the full onset of second-quarter reporting season. Still, we did hear from Wells Fargo (WFC), and that banking behemoth neither encouraged nor disappointed investors, as its results were right in line with forecasts. The stock, in response, did little save for some minor backtracking.

All told, at the midday break, the Dow Jones Industrial Average and Standard and Poor's 500 Index were off just a little, while the tech-laden NASDAQ, on strength in a few high-profile components, was up a handful of points. The 10 equity groups, meanwhile, were largely divided, with none venturing all that far from dead center.

Thus, as the afternoon began, the daily contest between the bulls and the bears was proving inconclusive. And, things didn't change much during the afternoon, as many traders no doubt took an early start for the summer weekend as they waited nervously for the start of reporting season this week. As for the market, it did show a slight bias to the upside as we moved further along on the session, apparently putting the cares of the previous day somewhat aside, but with earnings season about to commence in full force, the bulls could not make much headway, either in the cumulative averages or among individual issues. Of course, there were some exceptions, with high-flyers Google (GOOG) and Amazon (AMZN) making nice strides.

Not surprisingly, the strength in those two issues was part of the relative outperformance on the day by the tech-heavy NASDAQ, where the gain of 19 points easily surpassed, on a proportionate basis, the improvement in the Dow (29 points) and the Standard and Poor's 500 Index (three points).

As for earnings, they will be heating up this week, as noted, with a good number of corporations issuing their quarterly statements along with guidance for the third and fourth quarters. The kind of scenarios these company's present for investors could well have a big say in the performance of this frothy market as the year winds down.

Also, this will be a fairly active week from an economic standpoint, with a release this morning of a survey on machine tool orders, and data tomorrow on retail sales, as well as the Empire State Manufacturing Index. Then, on Wednesday, the Labor Department will roll out the Producer Price Index; the Commerce Department will provide a look at industrial production and factory utilization; while the Federal Reserve will issue its Beige Book, a compilation of facts and figures for the business outlook nationwide. The week then rolls on with Thursday's release on housing starts and building permits from Commerce, while the Labor Department will issue figures on weekly and continuing unemployment claims. The week then concludes with the release of the leading indicators on Friday. Retail sales, industrial production, and the data on housing starts would seem to be the most critical of the economic reports.

Finally, we look ahead to the day in the markets and following Friday's progressively better close, we find that stocks are pushing ahead in Europe thus far this morning, with fears about the health of the banking situation in Portugal apparently receding a little. In all, the principal bourses are up about a half a percentage point, or so. As to our markets, the early signs are quite positive, judging by the early eight-point increase in the S&P 500 Index futures and the 18-point surge in the NASDAQ futures. So, there would seem to be a little optimism ahead of earnings. The next few days will affirm whether such optimism is warranted. Stay tuned.   - Harvey S. Katz       

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.