Dow Surges Back Above 10,000, Financials Lead the Way
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Stocks surged today and the Dow again crossed above the key 10,000 psychological level, as investors view fears of a "double dip" recession as overblown and sentiment turned positive into disclosure about the methodology of the European bank stress tests. U.S. financial stocks led the advance, after positive guidance from State Street (NYSE: STT).
The Dow rose 275 points, or 2.8 percent, to close at 10,018. The Nasdaq rose 66 points, or 3.1 percent, to close at 2,159. The S&P 500 rose 32 points, or 3.1%, to close at 1,060.
With stocks down 14 percent from the April highs, investors felt more comfortable with valuations and were bargain-hunting some of their favorite stocks.
While the "new normal" of slow growth is here to stay, a "double dip" may not come to fruition according to some market analysts.
European stocks rallied today as The Committee of European Bank Supervisors are set to outline its methodology for the bank stress tests, which will simulate how the top 100 Euro-zone banks will fair under adverse economic scenarios. Debate about the scope of the tests and how much detail will be revealed could cause a delay in the release of the outline. Results of the stress tests are due on July 23. In Europe, the FTSE rose 1 percent, the DAX rose 0.9 percent and the CAC 40 rose 1.8 percent.
U.S. financial stocks were among the strongest sectors today after State Street (NYSE: STT) raised its Q2 outlook. State Street expects to report to report revenue of $2.3 billion and EPS of $0.87 for the second quarter of 2010, which is above the consensus of $2.21 billion and $0.72 and respectively. On an operating basis, State Street expects EPS of $0.93 on revenue of $2.2 billion. State Street rose 10 percent and the sector rose 4.4 percent, as represented by the ETF Financial Select Sector SPDR (NYSE: XLF).
The Dow rose 275 points, or 2.8 percent, to close at 10,018. The Nasdaq rose 66 points, or 3.1 percent, to close at 2,159. The S&P 500 rose 32 points, or 3.1%, to close at 1,060.
With stocks down 14 percent from the April highs, investors felt more comfortable with valuations and were bargain-hunting some of their favorite stocks.
While the "new normal" of slow growth is here to stay, a "double dip" may not come to fruition according to some market analysts.
European stocks rallied today as The Committee of European Bank Supervisors are set to outline its methodology for the bank stress tests, which will simulate how the top 100 Euro-zone banks will fair under adverse economic scenarios. Debate about the scope of the tests and how much detail will be revealed could cause a delay in the release of the outline. Results of the stress tests are due on July 23. In Europe, the FTSE rose 1 percent, the DAX rose 0.9 percent and the CAC 40 rose 1.8 percent.
U.S. financial stocks were among the strongest sectors today after State Street (NYSE: STT) raised its Q2 outlook. State Street expects to report to report revenue of $2.3 billion and EPS of $0.87 for the second quarter of 2010, which is above the consensus of $2.21 billion and $0.72 and respectively. On an operating basis, State Street expects EPS of $0.93 on revenue of $2.2 billion. State Street rose 10 percent and the sector rose 4.4 percent, as represented by the ETF Financial Select Sector SPDR (NYSE: XLF).
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