Market Wrap: Wall Street Heads Higher; Nasdaq Sets Record
NEW YORK -- U.S. stocks ended sharply higher Wednesday and the Nasdaq logged a record high close, led by a rebound in technology and health care stocks and optimism that Greece would avoid defaulting on its debt.
Reports that Athens and its creditors were near a deal pushed the euro higher against the dollar, partly reversing recent moves. EU officials, however, dismissed Greek claims an aid agreement was being drafted.
Investors said U.S. stocks were oversold in the previous session, when concerns about Greece and foreign exchange pushed Wall Street to its steepest fall in three weeks.
%VIRTUAL-pullquote-The fact that the market has been staying at its peaks for as long as it has, with only modest pullbacks, is fairly encouraging.%The S&P has inched up to a handful of record high closes in May. But the stock market has failed to make what some traders see as meaningful gains, in part because they are concerned about when the Federal Reserve will start to raise interest rates for the first time since 2006.
"People felt yesterday was an overreaction and I would agree," said Peter Jankovskis, co-chief investment officer at OakBrook Investments in Lisle, Illinois. "The fact that the market has been staying at its peaks for as long as it has, with only modest pullbacks, is fairly encouraging."
The Dow Jones industrial average (^DJI) rose 121.45 points, or 0.7 percent, to end at 18,162.99 points. The Standard & Poor's 500 index (^GSPC) gained 19.28 points, or 0.9 percent, to 2,123.48 and the Nasdaq composite (^IXIC) added 73.84 points, or 1.5 percent, to 5,106.59.
It was the S&P's strongest day since May 14 and the Nasdaq's strongest since late January, lifting it to its first record close since April 24.
Nine of the 10 major S&P 500 sectors ended higher, with technology up 1.8 percent and the health index up 1.1 percent.
Movers and Shakers
Broadcom (BRCM) surged 21.8 percent on news the chipmaker was in talks to be bought by Avago Technologies. Avago (AVGO) jumped 7.8 percent.
Gilead Sciences (GILD) rose 2.5 percent and led gains on the S&P health index.
The energy sector was off 0.1 percent as the rising dollar weighed on oil prices. The Dow Jones airlines index broke a 5-day losing streak to rally 2.2 percent.
Michael Kors (KORS) dropped 24.2 percent after the handbag maker reported its slowest quarterly revenue growth since going public.
Peers Coach (COH) fell 3.3 percent, Kate Spade (KATE) was off 4.7 percent and Fossil (FOSL) dropped 6.5 percent on Michael Kors' report of lower tourist traffic, weak watch demand and shipping delays due to West Coast port disruptions.
Advancing issues outnumbered declining ones on the NYSE by 2,242 to 808, for a 2.77-to-1 ratio on the upside; on the Nasdaq, 1,927 issues rose and 845 fell for a 2.28-to-1 ratio favoring advancers.
The S&P 500 posted 23 new 52-week highs and 4 new lows; the Nasdaq composite recorded 85 new highs and 50 new lows.
About 5.8 billion shares changed hands on U.S. exchanges, below the 6.2 billion daily average for the month to date, according to BATS Global Markets.
-With additional reporting by Tanya Agrawal.
What to watch Thursday:
- The Labor Department releases weekly jobless claims at 8:30 a.m. Eastern time.
- The National Association of Realtors releases its pending home sales index for April at 10 a.m.
These selected companies are scheduled to release quarterly financial results: