The stock markets in the United States rallied on Thursday as investors take advantage of the recent decline in the prices of equities. The report regarding the decision of Time Warner Cable, Inc (NYSE:TWC) to sell itself to Comcast Corporation (NASDAQ:CMCSA) overshadowed the weak sales in the retail industry.
Commenting on the momentum of the stock markets today, Donald Selkin, chief market strategist at National Securities Corp told Bloomberg in a telephone interview, “People want to buy the dips now because that market made a bottom after February 3. We got very oversold, and now it’s believed that the trend is turning back up. People feel like we’ve seen a near-term bottom in the market.”
On February 3, the S&P 500 declined 5.8% due to signs that the economy of China is slowing down as well as the weakening of currencies in the emerging markets. The S&P 500 has rallied since then over speculations that the projected economic growth will be able to endure the Federal Reserve’s tapering of its monthly bond-buying program.
Today, the Department of Commerce reported that sales of the retail sector in the United States dropped 0.4% in January due to severe winter weather conditions that prevented consumers from shopping at stores or going to car dealer’s showrooms.
Ryan Larson, head of U.S. equity trading at RBC Global Asset Management said, “The market has well discounted weather as the reason for recent economic weakness, and continues to be comfortable with Fed tapering so long as their economic outlook hasn’t changed. Easing stress in emerging markets also helps. Combined, those factors are helping to overcome the cautious sentiment we’ve seen as of late.”
- Dow Jones Industrial Average (DJIA)- 16,027.59 (+0.40%)
- S&P 500- 1,829.83 (+0.58%)
- NASDAQ- 4,240.67 (+0.94%)
- Russell 2000- 1,147.79 (+1.35%)
- EURO STOXX 50 Price EUR- 3,097.95 (+0.10%)
- FTSE 100 Index- 6,659.42 (-0.23%)
- Deutsche Borse AG German Stock Index DAX- 9,596.77 (+0.60%)
Asia Pacific Markets
- Nikkei 225- 14,534.74 (-1.79%)
- Hong Kong Hang Seng Index- 22,165.53 (-0.53%)
- Shanghai Shenzhen CSI 300 Index- 2,279.55 (-0.51%)
Stocks in Focus
The stock price of Applied Materials, Inc. (NASDAQ:AMAT) gained 5.36% to $18.87 per share after the company projected that its revenue for the second quarter will rise as much as 10%. The company invested more money to upgrade its factory. The memory chip maker posted $0.23 earnings per share and $2.19 billion revenue for the first quarter.
The shares of Time Warner Cable Inc (NYSE:TWC) climbed 7% to $144.81 per share after the company confirmed its decision to sell itself to Comcast Corporation (NASDAQ:CMCSA) for $45 billion. Under the agreement, each of the shares of Time Warner Cable will be exchanged for 2.875 shares of Comcast. The deal means the acquisition price for Time Warner stock is approximately $158.82 per share.
Whole Foods Market, Inc. (NASDAQ:WFM) plummeted 7.21% to $51.46 per share after the company reported lower-than-expected financial results and reduced its guidance for the full year due to strong competition. The organic and specialty foods retailer posted $158 million profit or $0.42 earnings per share on $4.24 billion revenue. The results missed the $0.44 earnings per share and $4.29 billion revenue consensus estimates of Wall Street analysts.