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Market News: CarMax Inc., Darden Restaurants, Shire PLC

Stock markets in the United States ended trading higher this week driven by positive momentum in the equities of pharmaceutical companies amid merger activity and investor speculation that the economy will grow faster.

The Dow Jones Industrial Average (DJIA) rose .2%, the S&P 500 climbed .18% and the NASDAQ rose .2% today. According to Bloomberg, healthcare companies in the S&P 500 increased .7%, propelled by the takeover offer for Shire PLC (ADR) (NASDAQ:SHPG).

In reaction to the stock markets’ movement, Terry Sandven, chief equity strategist at U.S. Bank Wealth Management, told Bloomberg, “This is an energy bunny sort of market that wants to keep marching higher and for a good reason.” With regard to the economy, Sandven commented, “The economy is showing varying signs of improvement. Earnings are rising, interest rates are low and inflation is elevated, but not at extremes. That’s a favorable environment for equities to march higher.”

This week stock prices went up after Federal Reserve Chairperson Janet Yellen stated that accommodative monetary policy, increasing prices of properties and equities, and the improving global economy should lead to above-trend growth. She also emphasized the need to create more jobs to put Americans back to work and talked down concerns regarding asset-price bubbles and incipient inflation.

U.S. Markets

  • Dow Jones Industrial Average (DJIA)- 16,955.98 (+0.20%)
  • S&P 500- 1,963.05 (+0.18 %)
  • NASDAQ- 4,367.97 (+0.20%)
  • Russell 2000- 1,184.03 (+0.08%)

European Markets

  • EURO STOXX 50 Price EUR- 3,302.36 (-0.38%)
  • FTSE 100 Index- 6,825.20 (+0.25%)
  • Deutsche Borse AG German Stock Index DAX- 9,987.24 (-0.17%)

Asia-Pacific Markets

  • Nikkei 225- 15,349.42 (-0.08%)
  • Hong Kong Hang Seng Index- 23,194.06 (+0.11%)
  • Shanghai Shenzhen CSI 300 Index- 2,136.73 (+0.46%)

Stocks in Focus

The stock price of CarMax, Inc (NYSE:KMX) rallied more than 16% to $52.76 per share after the company reported a 13.3% increase in revenues, which rose to $3.75 billion, for the first quarter of its fiscal 2015. The company posted adjusted earnings of 76 cents per share. CarMax benefited from strong sales for new and used vehicles during the period.

Shares of Darden Restaurants, Inc. (NYSE:DRI) declined more than 4% to $47.48 per share after the company reported lower-than-expected financial results for its fiscal fourth quarter. The owner of Olive Garden and Longhorn Steakhouse posted earnings of 65 cents per share on $2.32 billion in revenue. Wall Street analysts expected the company to deliver earnings of 94 cents per share on $2.3 billion in revenue.

Shire PLC (ADR) (NYSE:SHPG) rose more than 16% to $222.92 per share on a report that AbbVie Inc (NYSE:ABBV) is considering increasing its takeover proposal for the European specialty biopharmaceutical company. Shire rejected AbbVie’s previous $46.5 billion offer.