Closing Wrap-Up, Feb. 9
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February 9, 2010
Stocks rally as concerns about Europe’s debt problems ease. The Dow (DJI) gained 150.24 points, or 1.52 percent, closing the session at 10,058.64. The S&P 500 (SPX) added 13.78 points, or 1.30 percent, to 1,070.52. The Nasdaq (COMP) tacked on 24.82 points, or 1.17 percent, to 2,150.87. Volume remained on the light side on the session with the NYSE trading 1.24 billion shares and the Naz turning over 2.24 billion shares. Market breadth was positive by a 24-to-7 and 19-to-8 margin on the Big Board and Naz respectively.
Reports surfaced Tuesday that Europe was close to working out a rescue plan for Greece, Spain and Portugal. Near the end of the session, reports came out stating that Germany is considering loaning fund to these countries. Most analysts feel that the situation in Europe is being overdone in U.S. markets, but uncertainty can create a lot of bearishness.
Shares of Bank of America (BAC) and Citigroup (C) were mixed Tuesday after being downgraded at Standard & Poor’s. BAC and C were cut to “Negative”, leaving BAC with a minor loss, though Citi shares gained 0.95 percent. However, after trading above $5 in August 2009, Citi shares closed Tuesday’s session at $3.18. Overall, the Financial Select Sector SPDRs (XLF) rose 1.02 percent.
In earnings news, Coke-Cola (KO) missed earnings estimates by a penny, but traders were still pleased with the beverage company’s improvement. Revenues rose 5.4 percent, which was stronger than anticipated. KO shares gained 2.58 percent to $54.01. Another blue chip seeing gains Tuesday was Caterpillar (CAT), which rose 5.45 percent to $53.55. CAT benefited from an upgrade at Morgan Stanley and was the largest gainer on the Dow.
Electronic Arts (ERTS) shares were sharply lower Tuesday following the company’s earnings report. The electronic game creator saw its shares fall 8.75 percent to $15.96. ERTS beat earnings estimates for the quarter, but lowered its guidance for the next two quarters.
Airline stocks saw gains today thanks to strength American Airlines (AMR) and United Airlines (UAUA). AMR benefited from news that Japan airlines decided to continue its partnership with American. AMR shares gained 13.66 percent to $8.32. UAL shares rose 17.52 percent to $15.36 after reporting better than expected revenue in January. Overall, the NYSE Airline Index (XAL) rose 7.74 percent.
Jody Osborne
Senior Writer & Options Strategist
Optionetics.com ~ Your Options Education Site
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