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Spain Leads the American Rally — Thursday’s IP Market Recap

Postive news from Europe gives markets an afternoon lift


InvestorPlace Market RecapU.S. stocks moved ahead with strength and conviction on Thursday, even though economic reports released in the morning painted a mixed picture.

However, Spain released its official 2013 budget, showing that the country’s government is prepared to move ahead with austerity cuts, and what was a mild rally turned decidedly upward in the afternoon. The rally snapped a five-day losing streak.

For the record, the Nasdaq finished up 1.39% to 3,136, the S&P 500 closed up 0.96% at 1,447, and the Dow Jones Industrial Average finished ahead 0.54% to 13,485.

Domestic growth continues to lag, as second-quarter GDP numbers were revised down to 1.3% from the 1.7% reported in August. At the same time, slower durable goods orders and pending home sales lagged. Pending home sales actually dropped by 2.6% instead of the expected 0.5% increase. In the day’s only good news on the domestic front, the number of first-time claims for unemployment benefits fell, hitting its lowest level since July.

On the earnings front, banking and credit-card services company Discover Financial (NYSE:DFS) rose over 6% on the day after announcing Street-beating revenues and earnings for the fiscal third-quarter, powered by loan growth and falling delinquency rates. Thursday’s bump continued the company’s strong run for the year.

InvestorPlace Dependable Dividend Stock McCormick & Co. (NYSE:MKC) announced it beat earnings estimates but missed revenue expectations during the third quarter, and increased guidance for the remainder of the year, but the stock slid about 2%. Retailer Hennes & Mauritz (PINK:HNNMY), better known as H&M, closed 4% lower after missing revenue and earnings forecasts for the third quarter.

Tempur-Pedic (NYSE:TPX) announced it was buying mattress competitor Sealy (NYSE:ZZ) for $228 million, or $2.20 per share. Bank of America (NYSE:BAC) will provide Tempur-Pedic with $1.77 billion to finance the acquisition and the retirement of some debt. TPX shares surged 15% on the day; ZZ climbed just more than 2%, finishing right under the purchase price.

Finally, the National Football League came to a resolution with its closed-out referees, with the regular refs getting back to work starting with today’s Cleveland-Baltimore game. Office fans of both teams agree it should add legitimacy to the impending beatdown of the Browns.

Friday’s earnings notables include Walgreen (NYSE:WAG), American Greetings (NYSE:AM), and Finish Line (NASDAQ:FINL).

Three Up

  • First Solar (NASDAQ:FSLR): Up 11% ($2.30) to $23.20.
  • Kayak (NASDAQ:KYAK): Up 9.15% ($2.99) to $25.67.
  • Ciena (NASDAQ:CIEN): Up 7% (91 cents) to $13.88.

Three Down

  • RadioShack (NYSE:RSH): Down 6.5% (17 cents) to $2.43.
  • Annaly Capital (NYSE:NLY): Down 3% (52 cents) to $16.84.
  • Activision Blizzard (NASDAQ:ATVI): Down 2.65% (31 cents) to $11.37.

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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