Wall Street Ends Up Sharply. Challenges decrypts the session of the day on Wall Street. Indices have strongly increased Tuesday, supported by the unexpected escalation of housing starts and built in November in the United States.
The futures on the Dow are oriented upward from midnight. Between 2 am and 9 am in the morning they were moving in a trading range close to 30 points. From 9: 00 a.m. they resumed the progression, with a strong acceleration from 14: 30. Indices, they continued the direction of futures contracts and advanced during the session. The Dow has achieved highest session-21: 48 to 12 117 points. In the end, the Dow Jones finished in rising 337,17 points or 2.87% 12 103,43 points in normal volumes. The winners of the index include JP Morgan (+ 4.92%), Caterpillar (5.13%) and Home Depot (4.33%). There was no decline in the index.
The S & P500 rose 35,94 points or 2.98% to 1 241,29 points. The Nasdaq is is awarded 80,59 points or 3.19% to 2 603,73 points. The Russell 2,000 jumped 4.05%.
Investors were pleasantly surprised by the index of the climate of business in Germany which grew for the second consecutive month, to 107.2 106,6 points points, while it was expected to decline. Then, the success of the award of the Spanish debt has encouraged operators. The application of the Spanish Treasury to 3 and 6-month bills was very strong. While the Spanish State was lifted between 3.5 and € 4.5 billion , it managed to rise 5.6 billion. If he had fully responded to the request, it would have lifted more than € 18 billion. The rate at three months was 1,735% against 5.11% in November. The rate at six months is high at 2,435%, down from 5,227% in November. The new Spanish Prime Minister, Mariano Rajoy, promised deep spending cuts in his first speech before Parliament. But it is especially the innovative refinancing operation of the ECB with unlimited loans to three years at a rate of 1% which will be held Wednesday which explains such an application the Spanish debt as collateral tomorrow for banks seeking to borrow from the ECB.
Following these two good news from Europe, another surprise was waiting for operators. This time, the news came from the United States: the flight of the housing starts and permits in November. Following this announcement, futures began a progression which was followed by the indices in the session. As encouraging statistics have become rare recently, this has been greeted with enthusiasm that the market has not been seen since a time. It is important that it comes from the real estate market, which according to the Fed, still remains depressed despite the support provided by the TWIST of the Federal Reserve program. Yesterday the NAHB/Wells Fargo housing market index showed improvement of the sense of American manufacturers.
It is well probable that the upward momentum is strong enough to allow the indices to continue the progress in the short term, judging by the reaction of the market in some encouraging news. But a slight correction will not illogical.
The statistics of the day
The United States housing starts have soared from 9.3% in November after a decline of 2.9% in October (revised by 0.3%), according to the Department of trade. They emerged in data CVS to 685 000 units, the highest since April 2010, while economists were waiting only 635 000 units. The October figure was revised to 627 000 units against 628 000 in first estimate. Building permits have their side increased by 5.7% to 681 000 units in November, or one above since March 2010, after 644 000 (+ 9.3%) the previous month while analysts anticipated 635 000 units.
Companies with a magnifying glass
Oracle (+ 1.94% during the session,-7,95% after the announcement) presented its quarterly results tonight after the close of the market. Earnings per share of software specialist came to $0.54 against the consensus of $0.57. Its turnover amounted to $8.8 billion while analysts believed it to $9.23 billion.
The banking sector was the biggest winner of the day by flying 4.7%. Bank of America (3.71%) has rebounded after its passage below $5 per share yesterday and concerns that the Bank should comply with the stricter capital rules if the Fed agrees to apply the rules of Basel III. Its rivals, such as JP Morgan (+ 4.93%), Wells Fargo (+ 4.58%), Citigroup (+ 4.55%), US Bancorp (3.64%) and American Express (4.08%) have been largely in the green.
Jefferies (+ 22,37%) has been very sharp rise Tuesday. The Investment Bank has published its quarterly results well above analysts expectations. A few weeks ago Jefferies was scrupulously monitored by investors worried about its exposure to sovereign debt of the countries of the euro area.
AT & T (1.29%) announced that it waived acquire T-Mobile USA because of opposition from the US Government. Because of the failure of this operation of $39 billion, Deutsche Telekom will receive $6 billion, a sum provided by the clause of breach of contract and will invest in the US market. The American mobile subsidiary was an engine of growth for Deutsche Telekom in its first years, but, today, it does not have the means to build fourth generation network necessary to move the masses of data consumers and American businesses. Now analysts believe that T-Mobile could be closer to its competitor Sprint Nextel (9.26%) which therefore strongly grew Monday.
Construction sector and the real estate developers were in positive territory following the publication of housing starts and built at the United States in November. Thus, Caterpillar (+ 5.14%), Home Depot (+ 4.33%), Lennar (+ 6.21%), PulteGroup (+ 10.2%) and Toll Brothers (+ 6.49%), have posted large increases.
Specialists of the raw materials also soared Monday, like United States Steel (+ 5.2%), Alpha Natural Resources (+ 7.01%), Peabody Energy (+ 5.98%), Halliburton (+ 8.08%), Freeport McMoran (5.13%) and Barrick Gold (3.28%).
Red Hat (-8,9%), Open Source software specialist, has been the most big loser S & P500 today announced its quarterly results Monday evening after the close. Its earnings per share amounted to $0.28 against the expectations of $0.26. Its turnover reached $290 million, an increase of 23% in annual landslide, while the market expected $289,6 million. These are for the current quarter forecast that disappointed investors. Indeed, Red Hat anticipates that its EPS for the quarter ending in February, will be between $0.26 and $0.27 with sales between $289-$292 million.
General Mills (-0,91%) was among the few losers of the S & P500. The reason for the decline of the title is the decline of 28% of annual landslide quarterly profits. Earnings per share of the Group was on the $0.67 against the consensus of $0.79 and $0.92 a year ago. Its turnover increased by 14% in annual $4.62 billion slip while analysts projected $4.6 billion. GM has reaffirmed its forecast for the year and said that he anticipated strong sales and higher profitability in the second half of the fiscal year. However, the group warned that these gross margins decline due to the increase of costs and its recent acquisition of Yoplait has a low margin.
ConAgra jumped 4.01% for agri-food group reported its quarterly profit than analysts estimates. Thus, its BPA came to $0.47 against the consensus of $0.43.
CVS Caremark Corp rose by 8.9% since the chain of pharmacies has increased its quarterly dividend. It is thus increased from $0.125 to $0,1625 per share.