Positive Economic News Buoys Stocks For A Second Day

 |  Includes: DIA, QQQ, SPY
by: Midnight Trader
  • Dow Jones Industrial Average up 92.34 (+0.74%) to 12,627.01
  • S&P 500 up 11.86 (+0.90%) to 1,331.85
  • Nasdaq Composite Index up 21.26 (+0.74%) to 2,875.32


  • Hang Seng Index up 1.03%
  • Shanghai China Composite Index down 0.23%
  • FTSE 100 Index up 1.41%

Stocks finished with broad gains for a second day, supported by positive domestic economic data ahead of the start of a European Union summit tomorrow. Shares of energy companies led today's advance, rising over 2% as a group, joined by strong results among financial, healthcare and industrial stocks. The mining and materials segment also rose, supported by a rise in gold and copper prices.

Durable-good orders showed improvement, with new factory orders rising 1.1% during May, up from 0.2% the prior month and beating consensus estimates for a 0.4% gain. For the year, new orders are up 4.6%, lagging last year's 6.9% pace.

Excluding transportation, orders of items intended to last at least three years came in at 0.4% for the month, beating April's negative 0.6% reading. Analysts, on average, were expecting 0.8% growth.

There was more good news today from the housing sector, as the pending home sales index rose from a prior level of 95.5 to 101.1. At 5.9%, it well surpassed both the previous level of -5.5% and consensus estimates of 1.2% (range -1.6% to 4.0%). Moreover, the gain was realized relatively evenly across regions, rather than being centered in one geographic location.

In company news, shares of Arena Pharmaceuticals (NASDAQ:ARNA) soared today after regulators cleared the company's Lorcaserin weight-loss drug for U.S. sales, becoming the first new prescription diet pill approved in this country in 13 years.

The move by the U.S. Food and Drug Administration also sent shares higher for other drug-makers working on similar weight-loss medication. With the FDA expected to rule July 17 on its Qnexa diet drug, Vivus (NASDAQ:VVUS) established a new 52-week high. Orexigen Therapeutics (NASDAQ:OREX). was also up on the day

Google (NASDAQ:GOOG) finished with a small gain, as the company today unveiled its entry into the tablet computer market. The Nexus Seven is designed specifically for Google Play, the online store that sells movies, music, books, apps and other media content. GOOG also announced a home entertainment device called Nexus Q.


(+) ZZ, Q2 profit tops analyst consensus by $0.02. Revenue also beats estimates.

(+) NWSA, Hires JPMorgan, Goldman Sachs to advise on possible spinoff of publishing, entertainment operations.

(+) HERO, Initiated with Equal Weight rating, $5 price target, at Stephens.

(+) LEN, Q2 net income soars on a tax adjustment; deliveries, new orders also increase.

(+) ENTR, Raises Q2 guidance, now sees $81 million to $82 million in sales; $0.08 a share projected profit tops analyst consensus by $0.05.


(-) GIS, Q4 EPS beats by $0.01 but sales lag forecasts. FY13 earnings guidance also trails Street.

(-) ORLY, Auto-parts retailer cuts Q2 same-store guidance, now sees 2.0% to 2.5% growth. Rivals AAP, AZO also fall but PBY rises.

(-) M, Citigroup downgrades retailer to Neutral. JWN, SKS ratings also cut.

(-) OMER, Announces public offering of common stock with proceeds to fund two ongoing Phase III clinical trials.