Stocks Gain on Improved Data; Near Multiyear Highs

Published on Friday, 17 August 2012 14:53 Written by Christopher Lynn

New York, August 17^th  (TradersHuddle.com) –  Stocks were holding modest gains after better than expected economic data, which coupled with positive action in overseas markets was helping setup gains in the session. The improved economic data in the U.S., along with ongoing chatter of additional stimulus in China was dampening risk aversion. 

The Dow Jones Industrial Average was climbing 0.03%. The S&P 500 index was adding 0.01%, while the NASDAQ was gaining 0.22%

The market started near the unchanged line after futures showed little direction amid a quiet overseas session. Participants were digesting the prior session’s gains, while ongoing chatter over further Chinese stimulus along with comments from Angela Merkel supportive of the ECB’s pledge to save the euro spurred risk appetite.

On economic news, consumer sentiment edged to its highest level since May, while the leading indicators showed a gain in July, amid gains in housing permits and a drop in jobless claims.

It was a mixed bag in the S&P 500, with consumer discretionary, technology, and industrials posting the better gains, while healthcare, utilities, and energy fell. In the technology space, Apple (NASDAQ: AAPL) was jumping 1.37% to $645.05 after posting a new all-time high of $645.48. The stock responded favorably after Jefferies boosted its target price to $900 from $800, reiterating its Buy rating for the stock. The firm cited the expected launch of the iTV in the next year and the speculation that the iPad mini has gone into production.

In the consumer space, Ann (NYSE: ANN) was surging 22% to $34.34 after the retailer posted better than expected earnings and issued upbeat guidance. Gap (NYSE: GPS) was rallying more than 5% after the company topped its earnings estimates and raised its outlook for the year. The stock logged a new 52-week high of $36.23.

J.M. Smucker (NYSE: SJM) led the charge in the staples side, as shares were jumping more than 5% to $83.17. The stock logged a new 52-week high of $84.10 after the company posted solid quarterly results and offered an upbeat outlook.

Other notable movers in the session were Foot Locker (NYSE: FL), Bank of America (NYSE: BAC), Facebook (NASDAQ: FB), and Marvell Technology (NASDAQ: MRVL).

Footlocker was gaining more than 2% to $35.25 after beat earnings and revenue expectations. The footwear retailer said it earned $0.38 per share, $0.05 better than consensus, on revenue that climbed 7.2% from a year ago to $1.37 billion versus consensus of $1.35 billion.

Bank of America was climbing more than 1.4% to $8.04, posting the biggest gain in the Dow Jones Industrial Average. The stock broke above calculated resistance in the prior session, leaving it open to climb above the $8 per share level once again.

Facebook continued with its slide, following yesterday’s expiration of the first lockout period. The increased float available was adding pressure to the troubled stock, with Facebook logging a new all-time low of $19.01.

Marvell Technology was plunging more than 14% on the session after reporting quarterly results that missed earnings expectations on revenues that were short of consensus. The chipmaker offered a weak outlook for the current quarter, as weak PC sales and a slowdown in China weighed on performance.