--Stocks extend gains after Germany's Merkel expresses desire to hold
together euro zone
--New housing permits jump to highest level in four years
--Philly Fed factory report contracts more than expected
--Facebook slumps 6.3% after 'lockups' begin to expire
NEW YORK--Technology stocks helped to drive the biggest advance for
the Dow in almost two weeks after investors took comfort in German
Chancellor Angela Merkel's stated commitment to hold together the euro
zone.
The Dow Jones Industrial Average rose 85.33 points, or 0.65%, to
13250.11, and the Standard & Poor's 500-stock index added 9.98 points,
or 0.71%, to 1415.51. The Nasdaq Composite Index added 31.46 points,
or 1.04%, to 3062.39.
Thursday's gains pushed the benchmarks within striking distance of
multiyear highs. The S&P 500, on pace to climb for its sixth straight
week, closed just 3.5 points, or 0.2%, below its highest close this
year. Surpassing that, the benchmark would next hit levels last
reached in May 2008. The Dow finished 29 points under its 2012 closing
high, hit on May 1.
Technology stocks rose the most, followed closely by growth-sensitive
materials stocks. Dow component Cisco Systems surged $1.67, or 9.6%,
to $19.02 after the networking company reported quarterly earnings and
revenue that topped analysts' estimates and raised its quarterly
dividend by 75%, to 14 cents a share.
Wal-Mart Stores notched the biggest decline among blue chips, falling
2.30, or 3.1%, to 72.15 after the retailing giant reported sales that
fell short of expectations, countering quarterly earnings that were
slightly above estimates.
Facebook closed down 1.33, or 6.3%, to 19.87--an all-time low--as
lockups that prevented early investors in the social-network giant
from selling their shares began to expire Thursday. Overall, about two
billion shares will become eligible for sale between now and May,
nearly five times the number currently in circulation.
"Markets are trudging higher," said Paul Nolte, managing director of
Dearborn Partners, which manages assets for institutional and private
clients. "Even if it's a few points a day, markets have been improving
ever so slightly, and the internals of the market are supportive of
maintaining the trend."
U.S. stocks extended the session's gains, and European markets
finished higher, after Ms. Merkel said her country is "committed to do
everything we can in order to maintain the common currency," at a
joint news conference with Canadian Prime Minister Stephen Harper. The
Stoxx Europe 600 rose 0.3%, finishing at a nearly five-month high.
Spain's IBEX 35 surged 4.1%.
A raft of U.S. economic news delivered mixed results. Home building
slipped in July, missing expectations, but new permits rose to their
highest level in four years, a possible sign of confidence for
construction going forward.
The Philadelphia Federal Reserve's index of manufacturing activity
showed a bigger-than-expected contraction in August, one day after a
New York reading contracted for the first time this year. The number
of U.S. workers filing applications for unemployment benefits rose
last week, in line with forecasts.
"We think residential construction will continue to support economic
growth, but it will be difficult to offset weakness in other parts of
the economy, like manufacturing," said Elizabeth Ptacek, senior vice
president and real-estate analyst at KeyBank in Cleveland.
In Asia, China's Shanghai Composite slipped 0.3% even after Chinese
Premier Wen Jiabao hinted at more monetary stimulus in the world's
second-largest economy. Other Asian markets were mostly higher, with
Japan's Nikkei Stock Average gaining 1.9% to a six-week high and with
Australia's S&P/ASX 200 climbing 1.1%.
Crude-oil futures rose 1.3% to finish at $95.60 a barrel, while gold
futures settled up 0.8% at $1,616.10 a troy ounce. The dollar fell
against the euro and gained ground against the yen. The yield on
benchmark 10-year Treasury notes rose to 1.836%, the highest since
May, as demand fell.
Agilent posted the biggest decline on the S&P 500, falling 3.33, or
8.2%, to 37.15, after the testing-and-measuring equipment maker's
fiscal third-quarter earnings fell short of expectations and the
full-year outlook was reduced.
Perrigo fell 7.67, or 6.6%, to 108.93 after the store-brand
pharmaceutical and nutritional-products maker reported higher sales
last quarter, but its revenue missed estimates.
Videogame maker Electronic Arts jumped 72 cents, or 5.5%, to 13.81
after a news report said the company, which is struggling against
competition for free online-gaming sites, is exploring a sale. The New
York Post said private-equity firms KKR, which was flat at 14.52, and
Providence Equity Partners approached Electronic Arts about a
potential deal. A spokesman from Electronic Arts said the company
doesn't comment on speculation.
PetSmart rallied 3.09, or 4.6%, to 70.53 after the pet-products
retailer reported better-than-expected fiscal second-quarter results
and raised its full-year earnings and sales-growth outlooks.
Sears Holdings rose 3.69, or 6.5%, to 60.29 after the retailer
reported a second-quarter loss that narrowed on cost-cutting measures,
although sales declined more than expected.
Hi-Crush Partners rose 3.00, or 18%, to 20.00 in its public debut,
rising gradually through the session after a flat open. The company
produces premium monocrystalline sand, which is used to improve the
recovery of oil and gas during hydraulic fracturing.
Write to Chris Dieterich at christopher.dieterich@dowjones.com.
Subscribe to WSJ: http://online.wsj.com?mod=djnwires
(END) Dow Jones Newswires
August 16, 2012 06:55 ET (10:55 GMT)
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