Biggest Rebound in Over a Year Puts Equities Positive Again for 2010

|
 |  Includes: AETUF, CMTL, CPII, DIA, FNMA, FXE, QQQ, RUBO, SPY
by: Midnight Trader

4:24 PM, May 10, 2010 --

  • NYSE up 341.4 (4.9%) to 7,257.62.
  • DJIA up 404.7 (3.9%) to 10,785.
  • S&P 500 up 49 (4.4%) to 1,160.
  • Nasdaq up 109 (4.8%) to 2,375.


GLOBAL SENTIMENT

  • Hang Seng up 2.54%
  • Nikkei up 1.6%
  • FTSE up 4.76%


UPSIDE MOVERS

(+) CPII sold to Comtech for $16.40 per share.

(+) TSN beat with Q2 results.

(+) CFSG beats Q1 estimates, reaffirms outlook.

(+) DISH beats with Q1 results.

(+) DEER beats with Q1 results.

(+) DYN swings to Q1 profit.

(+) ASYS gets new solar orders.

(+) FNM loss narrows vs year ago.

(+) LVS declares quarterly dividend.

(+) OMX upgraded.

(+) RZ cancels controlled equity offering.

(+) BA upgraded.

(+) HOGS sales top year-ago result.

(+) MCD sales same-store sales up 4.9%.

(+) BDSI gets Canadian approval for Onsolis.

(+) YHOO upgraded.

(+) F says China and India sales strong in April.

(+) SOL lifts outlook.

(+) HOT, HST gaining with broader market but are subject of Barron's feature suggesting share prices overvalued.

(+) DENN subject of Barron's piece on shareholder desire for new board; earnings due in after-hours session.

DOWNSIDE MOVERS

(-) DF misses with earnings and guides below Street for Q2.

(-) MCO over weekend disclosed Wells Notice from SEC.

MARKET DIRECTION

Stocks push higher late in the day after having drifted back to near the midpoint of the session. By the bell, the major averages are up nearly 4%, part of a broad global rebound that unwound a portion of last week's steep decline. Investors embrace, for now, a near $1 trillion plan to stem the European debt crisis.

All averages are back in positive territory for 2010 in the wake of a nearly $1 trillion rescue package to stop Europe's debt crisis from spreading. The euro gained sharply initially but began to pull back considerably as the day progressed, one sign that some skepticism for the effectiveness of the plan or at least the reaction in pushing up the shared currency so sharply, is emerging.

The tech-heavy Nasdaq's 100-plus point gain is its first triple-digit advance since late in 2008. The Dow's 400-point march is its strongest one-day performance in more than a year. The Dow slid 5.7% last week in its worst drop since the depths of the financial crisis in October 2008.

Some European markets snapped back as much as 9% today from steep losses over several days last week.

The European Union and the International Monetary Fund agreed to create a nearly $1 trillion fund to support European nations burdened by heavy debt. The scope of the plan was greater than many analysts had expected and eased fears at least for now that leaders wouldn't be able to suppress the crisis, the AP reported.

As part of the plan, the U.S. Federal Reserve restarted a program from 2008 to ship dollars overseas through the foreign central banks. Those central banks can then lend the dollars out to banks in their home countries. The Bank of England, the European Central Bank, the Bank of Canada, the Swiss National Bank and the Bank of Japan are also involved in the dollar-swap effort.

Morgan Stanley European equity strategists on Monday switched from "underweight" to "overweight" equities, also moving to "neutral" from "underweight" in financials, according to a report on MarketWatch.

Deal news was also supporting the broader stock market.

Comtech Telecommunications (NASDAQ:CMTL) and CPI International (CPII) jointly announced the signing of a definitive merger agreement under which Comtech will purchase CPI in a cash and stock transaction with an enterprise value of approximately $472.3 million.

Rubio's (RUBO) gained after the company says an entity controlled by Mill
Road Capital will acquire RUBO for $8.70 per share. The aggregate transaction value is approximately $91 million. The deal is seen closing in Q3.

In other company news, Energy Conversion Devices (NASDAQ:ENER) jumped after beating Q1 estimates. It lost an adjusted $0.64 per share in Q3, better than the Thomson Reuters mean for a loss of $0.75. Sales were $72.4 million, beating estimates of $61.1 million.

Fannie Mae (FNM) gained after the company reports a smaller Q1 loss from a year ago's levels.