Monday's Closing Update: Housing, Financials Rally Broader Market

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Includes: AIG, AYE, BAC, DDS, HEB, HIG, IDMI, JASO, JWN, LOW, MGM, MRVL, STT, TXCO, WMT
by: Midnight Trader

-NYSE up 202.9 (3.5%) to 5,865.87.

-DJIA up 239 (2.9%) to 8,508.

-S&P 500 up 26.7 (3%) to 909.62.

-Nasdaq up 52.2 (3.1%) to 1,732.

GLOBAL SENTIMENT

Hang Seng up 1.38%

Nikkei down 2.44%

FTSE up 2.26%

UPSIDE MOVERS

(+) State Street (NYSE:STT) selling convertible debt.

(+) Bank of America (NYSE:BAC) added to Goldman's Conviction Buy list.

(+) Lowe's (NYSE:LOW) beats with earnings.

(+) Wal-Mart (NYSE:WMT) gains as WSJ says retailer looking to boost share of electronics market.

(+) J.A. Solar (NASDAQ:JASO) firming with broader market despite analyst downgrade.

(+) IDM Pharma (IDMI) sold to Takeda Pharma for $2.64 per share.

(+) Hemispherx Biopharma (NYSEMKT:HEB) says no material events to account for unusual stock activity.

(+) MGM Mirage (NYSE:MGM) upgraded at JP Morgan.

(+) Hartford Financial (NYSE:HIG) is keeping Life, P/C Insurance units: Bloomberg

(+) Dillard's (NYSE:DDS) reports surprise profit.

DOWNSIDE MOVERS


(-) Exploration Company (TXCO) to file for Ch. 11.

(-) Allegheny Energy (AYE) downgraded at Wachovia.

(-) Nordstrom (NYSE:JWN) downgraded to Sell at Goldman.

MARKET DIRECTION


Stocks close in the upper end of the day's range, with the major averages all up around 3%, as home-building sentiment data lifted the mood on Wall Street. Earlier, better-than-expected results from home retailer Lowe's (LOW) lifted investor sentiment.

Buying accelerated later after the National Association of Home Builders said its housing market index rose for the second month in a row in May, the highest level in eight months.

More key economic data will be released Tuesday on housing construction and Thursday on regional manufacturing.

Financial shares were broad gainers.

Bank of America (BAC) helped to lift financial shares after some analysts issued positive comments on the stock, and Goldman Sachs added it to its "conviction buy" list.

State Street Corp. (STT) said it plans to raise funds through stock and debt offerings as part of an effort to repay $2 billion from the government. While the move will dilute stockholders, analysts see it as a positive sign that banks are able to raise capital in the private markets.

Insurer American International Group (NYSE:AIG) is said to be speeding up plans to list its Asian subsidiary through an IPO that could raise more than $4 billion. AIG is also anxious to pay back government bailouts.

Technology stocks gained in step with the broader market. Marvell Technology (NASDAQ:MRVL) is helping lead technology stocks higher, specifically chip stocks, after the company was upgraded to Buy from Neutral at Credit Suisse.

Crude futures rose nearly 5% Monday as U.S. stocks rallied and as concerns increased that militant unrest in Nigeria may disrupt supplies from Africa's biggest oil producer.

Crude for June delivery gained $2.69, or 4.8%, to $59.03 a barrel on the New York Mercantile Exchange. Monday's gain erased the 4% loss crude from last week.