Sharp Gains Include 319-Point Bounce For Dow

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Includes: DIA, QQQ, SPY
by: Midnight Trader

4:13 PM, Oct 10, 2011 --

  • NYSE up 247 (+3.6%) to 7,172
  • DJIA up 327 (+2.9%) to 11,431
  • S&P 500 up 39 (+3.4%) to 1,194
  • Nasdaq up 86 (+3.5%) to 2,566

GLOBAL SENTIMENT

  • Nikkei closed.
  • Hang Seng up 0.02%.
  • Shanghai Composite down 0.6%.
  • FTSE-100 up 0.9%.
  • DAX-30 up 0.5%.

UPSIDE MOVERS

(+) NFLX to keep DVD business.

(+) MU upgraded.

(+) HOT gets favorable Barron's coverage.

(+) BAC leading banking gains amid hopes for European stability efforts for banks there.

(+) POT upgraded.

(+) CPX merging with Superior Energy.

(+) ACN downgraded.

DOWNSIDE MOVERS

(-) S handed several downgrades.

(-) SMG cuts earnings view.

(-) INSM says FDA Maintaining Clinical Hold on Phase 3 Arikace Cystic Fibrosis Trials.

MARKET DIRECTION

Stocks close up sharply as a late push returned the main averages to session highs. Wall Street gained after German and French officials said they'd be at the ready to help European banks. Investors are also looking to the latest earnings season, set to kick off this week, with cautious optimism.

Yesterday, French President Nicolas Sarkozy and German Chancellor Angela Merkel agreed that European banks need to be strengthened, but very few additional details were provided. Despite the lack of detail, the pledge served as evidence that European leaders will tackle the eurozone's debt crisis more directly.

Crude oil futures finished higher Monday. November crude rose $2.43, or 2.9%, to end at $85.41 a barrel on the New York Mercantile Exchange. Prices haven't closed at a level that high since Sept. 21, and they've now tallied a four-session gain of almost 13%.

Gold futures ended up $38 or 2.3% at $1,674 an ounce.

In company news:

Yahoo Inc. (YHOO) gained after co-founder and former CEO Jerry Yang is mulling a deal with private-equity firms that would take Yahoo private, Reuters reported on its website Sunday, citing unnamed sources familiar with the matter. The deal could involve Yang, as well as the company's other co-founder, David Filo, rolling over their stakes in Yahoo.

Shares of Sara Lee (SLE) rose after the food products company said it will sell its fresh bakery businesses in Spain and Portugal to Mexico's Grupo Bimbo S.A.B. de C.V. for approximately $154 million (at current exchange rates) in cash. The agreement includes all Sara Lee fresh bakery brands in Spain and Portugal as well as seven manufacturing facilities. The transaction is expected to close within 60 days.

Merck (NYSE:MRK) shares gained after it announced today that the U.S. Food and Drug Administration (FDA) has approved JUVISYNC, a new treatment for type 2 diabetes that combines the glucose-lowering medication sitagliptin, the active component of JANUVIA, with the cholesterol-lowering medication ZOCOR.

Shares of Apple (NASDAQ:AAPL) rose after the company said pre-orders of its iPhone 4S have topped one million in a single day, surpassing the previous single day pre-order record of 600,000 held by iPhone 4.

HSBC (HBC) rose on news that the British bank is in talks to sell its South Korean retail-banking operations to South Korean government-owned KDB Financial Group, according to The Wall Street Journal. In addition, Dow Jones Newswires reports that the bank has also entered into an agreement to sell 94% of its Hungarian consumer finance portfolio to Cofidis Magyarorszagi Fioktelepe.

Shares of Teva Pharmaceutical (NYSE:TEVA) jumped after the generic drug maker said the FTC approved its merger with Cephalon (NASDAQ:CEPH). As part of the approval, TEVA is required to divest two Abbreviated New Drug Applications (ANDAs) for fentanyl citrate lozenges, a generic version of Actiq, and cyclobenzaprine ER capsules, the generic version of Amrix.