This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Stocks Surge Ahead of Fed

NEW YORK ( TheStreet) -- Stocks closed near session highs Monday as a technical breakthrough by the S&P 500 and an official end date for the recent economic recession had investors feeling more confident about the market's direction a day ahead of the Federal Open Market Committee's rate decision.

News that IBM (IBM - Get Report) plans to acquire Netezza (NZ), a maker of data warehouse and monitoring appliances, for $1.7 billion also lifted equities, as did better-than-expected earnings from Lennar (LEN - Get Report). The homebuilder swung to a third-quarter profit of 16 cents a share, far exceeding Wall Street's expectation for a profit of a nickel per share, according to

Shares of Netezza jumped 14.9% to $28.27 and Lennar's stock climbed 8.2% to $15.14.

The Dow Jones Industrial Average gained 146 points, or 1.4%, to finish at 10,754. The S&P 500 added 17 points, or 1.5%, to 1,143, and the Nasdaq finished 40 points higher, or up by 1.7%, at 2,356.

The Dow is now up in 12 of the last 14 sessions, and Monday's finish was its highest since May 13. The September rally is on an historic pace with its gain of 7.4% to date putting it on track for its best performance in this historically bad month since 1939.

During Monday's session, the National Bureau of Economic Research said the recession that began in December 2007 officially ended in June 2009 , marking a 18-month downturn that was the longest recession since World War II.

Speaking at an "Investing in America" town hall meeting on Monday afternoon, President Obama said that although the recession is over Americans are still struggling to regain financial footing.

Marc Pado, U.S. market strategist at Cantor Fitzgerald, credited the market's advance to the S&P's technical breakout above 1,130. Pado believes that the forces pushing markets forward have been building for a while.

"What we're seeing right now has more with what will be compelling the market going forward. You have the end of the quarter coming up and equity participation has been low -- particularly in the technology sector. There's a natural transition that occurs at the end of September out of consumer staples, which have done really well, but they aren't your typical fourth-quarter investments," Pado said, adding that the fourth-quarter usually sees improvement in consumer spending and IT spending.

"Plus you have third-quarter earnings coming up. Last week, Oracle (ORCL) and Research In Motion (RIMM) showed that good profits can still be made in this environment so I think earnings will be largely positive for the market."

Additionally, Pado sees election results as likely to be supportive since the market likes to see parties split between the House and Senate because the "gridlock" tends to result in more moderate policies.

"Overall, there's a real sense that there's very little negative that hasn't already played out," Pado said, pointing to European debt concerns, new financial regulations and health care reform. "We see a lot more positives than negatives on the horizon."
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AXP $52.63 0.44%
HD $113.76 1.70%
JPM $56.23 -0.55%
HPQ $9.20 -1.80%
IBM $124.03 -2.30%


Chart of I:DJI
DOW 16,014.38 -12.67 -0.08%
S&P 500 1,852.21 -1.23 -0.07%
NASDAQ 4,268.7630 -14.99 -0.35%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs