RTTNews - Stocks are continuing to post considerable gains in mid-afternoon trading on Thursday, with the strong upward move largely precipitated by the day's encouraging report on existing home sales. The major averages remain in positive territory by substantial margins.
This morning, a report from the National Association of Realtors showed that existing home sales increased for the third consecutive month in June, while home prices declined at a slower pace.
Also on the economic front, the U.S. Labor Department revealed that first-time claims for unemployment benefits showed a moderate increase in the week ended July 18th, with the increase coming roughly in line with economist estimates.
In earnings news, traders have looked to a slew of reports, with 3M (MMM), Ford (F) and Wyeth (WYE) reporting results that surpassed Wall Street estimates. McDonald's (MCD), AT&T (T), Qualcomm (QCOM) also beat forecasts, although by more modest margins.
The major averages have moved roughly sideways in recent trading after backing off of their best levels of the session. The Dow is currently up 185.46 at 9,066.72, the Nasdaq is up 46.18 at 1,972.56 and the S&P 500 is up 22.13 at 976.20.
Nearly all of the Dow components are moving higher in mid-afternoon trading, contributing to the standout gain being shown by the blue chip index.
3M is helping to lead the Dow higher, with the diversified conglomerate currently up 7.1 percent. With the gain, shares of 3M have risen to their best intraday level in almost ten months.
The advance by 3M comes after the company reported second quarter earnings that came in at $1.20 per share after adjustments, firmly beating estimates of $0.94 per share for the quarter. Although net sales declined compared to the same period last, the figure still beat estimates.
Shares of Alcoa (AA) are also moving sharply higher, with the aluminum giant posting a gain of 6.1 percent in mid-afternoon trading. The upward move has helped the stock to reach its best intraday level in just over one month's time.
DuPont (DD) and Disney (DIS) are also posting strong gains, rising by 5.8 percent and 5.3 percent, respectively. DuPont has reached its best intra-day price in seven weeks, while Disney was able to reach its highest intraday price in over nine months.
While Caterpillar (CAT), Verizon (VZ), Bank of America (BAC), General Electric (GE) are also among the other Dow components posting significant gains, shares of McDonald's are seeing notable weakness.
McDonald's is currently down 5 percent, falling to their worst intraday level in over two months after the fast food giant reported disappointing June same store sales. Boeing (BA) and Wal-Mart (WMT) are posting more modest losses.
Housing and biotechnology stocks are continuing to turn in some of the day's best performances, while chemical stocks are also posting notable gains. The S&P Chemical Index is up by 4.3 percent, reaching its best intraday level in over eight months.
The chemical sector is being led higher by shares of Dow Chemicals (DOW) and Eastman Chemical Company (EMN), which are up both currently 5.8 percent.
Real estate and oil service stocks are also turning in strong performances, as reflected by the 4.2 percent gain being shown by the Morgan Stanley Real Estate Index and the 3.5 percent gain by the Philadelphia Oil Service Index. Both indices have moved to their best intraday levels in roughly six weeks.
Retail, banking, networking, transportation and utility stocks are also moving sharply higher, reflecting the day's broad based strength in the equity markets.
In Focus: Economic Data, Earnings & Corporate News
As mentioned above, an industry report from NAR showed that existing home sales rose 3.6 percent to an annual rate of 4.89 million units in June from a downwardly revised rate of 4.72 million in May. Economists had expected sales to rise to a 4.84 million unit rate from the 4.77 million unit rate originally reported for the previous month.
Data from the Labor Department showed that jobless claims rose to 554,000 from the previous week's revised figure of 524,000. Economists had expected jobless claims to increase to 557,000 from the 522,000 originally reported for the previous week.
On the earnings front, Ford revealed second-quarter net income of $0.69 per share, although its adjusted results showed a loss of $0.21 per share. The loss was narrower than the loss of $0.63 per share in the year-ago quarter while also beating Wall Street expectations of a loss of $0.48 per share. Sales slipped but were also able to beat forecasts.
Wyeth reported adjusted second-quarter net income of $0.98 per share, compared to $0.91 per share in the year ago quarter. The results surpassed forecasts of $0.85 per share for the quarter.
After the closing bell today, traders will look to results from American Express (AXP), Microsoft (MSFT) and Amazon (AMZN), which are some of the big-name companies slated to report.
In other news, Bristol-Myers Squibb (BMY) signed a definitive agreement to acquire biotech firm Medarex (MEDX) for $16 per share in cash or a total of $2.4 billion. Bristol-Myers Squibb also revealed earnings and guidance that exceeded Wall Street estimates.
In overseas trading, stock markets across the Asia-Pacific region finished on the upside on Thursday. While Japan's benchmark Nikkei 225 Index posted a 0.7 percent gain, Hong Kong's Hang Seng Index surged up by 3 percent.
The major European markets also closed notably higher, with the German DAX Index and the French CAC 40 Index finishing up by 2.5 and 2.1 percent, respectively, while the U.K.'s FTSE 100 Index posted a 1.5 percent gain.
In the bond markets, treasuries are showing notable weakness amid the rally on Wall Street and emerging concerns over next week's influx of bond supply. Subsequently, the yield on the benchmark ten-year note is trading at 3.683 percent, posting a gain of 12.9 basis points on the day.
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