Europe, America Play Well Together — Thursday’s IP Market Recap

by Marc Bastow | September 6, 2012 5:14 pm

InvestorPlace Market Recap[1]Now that’s more like it.

Better-than-expected reports on the U.S. labor market front and agreement on the European Central Bank’s bond-buying plan[2] lifted investor spirits, and the markets soared broadly on the day.

How high? Glad you asked. The Nasdaq led the way with a 2.17% gain to settle at 3,135, the S&P 500 rose 2.04% to end at 1,432 and the Dow Jones gained 1.87% to finish at 13,292.

ECB president Mario Draghi reiterated his intentions to save the euro and said the central bank will buy eurozone government bonds on the secondary market, as long as countries requesting help follow a fiscal discipline checklist[3].

In the U.S., private-sector nonfarm jobs increased by 201,000[4] from July to August, according to ADP’s National Employment Report. The estimated gain from June to July was revised from the initial estimate of 163,000 to 173,000, far better than the originally estimated 143,000 jobs.

More good news: The Labor Department announced that jobless claims decreased to 365,000 during the week ending Sept. 1, down 12,000 from the previous week’s revised 377,000 figure, and less than the 373,000 claims anticipated by economists. And a report from outplacement firm Challenger, Gray & Christmas showed more than 32,000 planned job cuts in August — a number less than announced in July, and a 20-month low[5].

The advance was — you know — broad, with all 30 components of the Dow moving higher. Bank stocks led the way, with  Bank of America (NYSE:BAC[6]) surging 5% and JPMorgan Chase (NYSE:JPM[7]) gaining more than 4%. Shares of Walt Disney (NYSE:DIS[8]) reached a new all-time high[9], finishing up more than 2% to settle at $51.86, marking nearly 40% gains year-to-date.

Auto and engine manufacturer Navistar (NYSE:NAV[10]) announced a profit for the second quarter, although most of it was due to a tax benefit of $196 million; the company actually lost money during the quarter. However, revenues beat Street estimates, and the stock surged more than 17% on the day.

Retailer Men’s Wearhouse (NYSE:MW[11]) did Navistar a couple points better, rocketing 19% after reporting second-quarter earnings[12] that beat estimates, though sales were lower and full-year earnings forecasts came in short of expectations.

Verifone (NYSE:PAY[13]) shares tumbled over 11% on news of a disappointing third quarter[14] that saw shrinking revenue that missed Street estimates.

Sears Holdings (NASDAQ:SHLD[15]) and J.C. Penney (NYSE:JCP[16]) continued recent runs. SHLD gained 10% after announcing Eddie Lampert purchased $126.6 million worth of stock[17] in a private sale, increasing his stake to 64%. JCP revealed an exclusive partnership with Cosmopolitan magazine to market a line of lingerie, sleepwear, footwear and handbags under the Cosmopolitan Collection in 600 JCP stores. JCP stock rose nearly 6% on the day.

Three Up

Three Down

Marc Bastow is an Assistant Editor at As of this writing he did not hold a position in any of the aforementioned securities.

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  2. European Central Bank’s bond-buying plan:
  3. follow a fiscal discipline checklist:
  4. private-sector nonfarm jobs increased by 201,000:
  5. a 20-month low:
  6. BAC:
  7. JPM:
  8. DIS:
  9. reached a new all-time high:
  10. NAV:
  11. MW:
  12. reporting second-quarter earnings:
  13. PAY:
  14. disappointing third quarter:
  15. SHLD:
  16. JCP:
  17. announcing Eddie Lampert purchased $126.6 million worth of stock:
  18. WXS:
  19. SFLY:
  20. SWK:
  21. PWER:
  22. HOV:
  23. STX:
  24. read more here:

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