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
TheStreet Open House

Stocks Run Up on Greece Speculation, Jobs Outlook


NEW YORK (TheStreet) -- Stocks posted a second day of gains after a steep selloff earlier in the week as investors speculated that Greece was successful in its debt swap efforts.

The Dow Jones Industrial Average gained 70.6 points, or 0.6%, at 12,908. The S&P 500 was up 13.3 points, or 1%, at 1366, and the Nasdaq added 34.7 points, or 1.2%, at 2970.

Stocks have drifted higher since Tuesday, which saw the worst plunge in markets year-to-date. Traders are now focused on the official outcome of Greece's debt restructuring as well as Friday's payroll numbers out of the U.S. Expectations for February job gains are high, with economist looking for north of 200,000 additions according to Thomson Reuters.

The deadline for private bondholders in Greece to agree to take a write-down on their holdings passed at 3 p.m. Thursday. A formal announcement on how many investors signed up for the swap will be available sometime Friday morning. However, several newswires reported that more than 75% of the debt to be restructured has been tendered. With stocks popping one hour before the close, it seemed that investors believed Greece would move with its plans.

The €206 billion debt restructuring deal is crucial given that it is a prerequisite for Greece to be able to receive a €130 billion rescue package.

"[There was] quite a bit of short covering going into the completion of the Greek bond swap," said Quincy Krosby, market strategist with Prudential Financial, explaining that traders don't want to get caught if the market rallies on news of the swap's success.

In Germany, the Economy Ministry in Berlin said that that the country's industrial output bounced back more than expected, helped by gains in construction output thanks to a mild winter. Output rose 1.6% in January after a fall of 2.6% in December, which marked the biggest drop in almost three years.

Elsewhere in Europe, European Central Bank President Mario Draghi hinted that the ECB may be done with its long-term liquidity injections, or LTRO. Draghi said that the worst of the eurozone debt crisis is over despite ongoing economic sluggishness and added that euro area inflation may exceed the bank's 2% limit this year.

In a sign that debt contagion fears were easing, bond prices in the eurozone, including in Italy and Spain have fallen. Italian government bond yields have dropped to their lowest levels since the middle of last year.

London's FTSE finished up 1.18%, and Germany's DAX closed higher by 2.45%. In Asia, Japan's Nikkei Average finished stronger Thursday by 2.01% as Japan's economy was reported to have contracted a revised 0.2%, which was less than the prior fourth-quarter estimate. Hong Kong's Hang Seng index closed up 1.32%.

Earlier Thursday, the Labor Department reported that the number of Americans filing for first-time unemployment benefits rose by 8,000 to 362,000 last week from a revised 354,000 the preceding week. Analysts surveyed by Thomson Reuters expected weekly initial jobless claims for the week ended March 3 to fall to 350,000 from an originally reported 351,000.

"[There was] a small uptick in claims, but the four-week moving average is still basically at the lowest levels since March 2008 so it's hardly a threat to the notion of improving labor conditions," says David Ader, a strategist at CRT Capital Group.

Also today, the Federal Reserve reported that U.S household wealth grew by $1.19 trillion in the fourth quarter from the prior quarter to $58.5 trillion. Household wealth increased for the first time in three quarters as gains in stock prices overtook a decline in home values.


In corporate news, McDonald's (MCD) shares lost 3.2% to $96.96 after the fast-food chain reported a rise in February global sales at restaurants open at least 13 months of 7.5%, missing estimates. This, as European customers reduced their spending. An increase of 7.7% was expected by analysts polled by Thomson Reuters.

Apple (AAPL) and five of the biggest U.S. publishers have been warned by the Justice Department it plans to sue them for allegedly colluding to raise the price of electronic books, The Wall Street Journal reported. Apple unveiled a new version of its iPad tablet on Wednesday. Shares were up 2.1% to $541.99.

The U.S. Treasury is selling $6 billion worth of its bailout-related holdings in insurance giant American International Group (AIG). AIG is expected to purchase up to $3 billion worth of the stock being sold by the Treasury, which will still hold nearly $42 billion sunk into the company following its 2008 bailout. Shares of AIG slid 3.9% to $28.31.

CalSTRS, the California teachers pension fund, plans to vote against Kinder Morgan's (KMI) $23 billion acquisition of El Paso (EP). Kinder Morgan shares rose 1.2% to $36.73 while El Paso shares were up 1.1% to $28.74.

The Men's Wearhouse (MW) saw its fourth quarter losses narrow as the retail clothing store was able to increase selling prices in the U.S. and its gross margins. Sales grew 3.7% to $562.2 million, short of the $563.17 expected. Losses came in at 7 cents a share, less than 27 cents a share in the period a year earlier. Analysts had expected a loss of 13 cents a share, excluding special items. For the fiscal year, the company gave guidance of $2.70 to $2.78 a share in earnings, compared to the 62 cents a share projected by analysts. Shares shed 3.1% to $38.95.

April oil futures rose 42 cents to $106.58 a barrel, while April gold futures gained $14.80 to $1,698.70 an ounce.

The benchmark 10-year Treasury was down 13/32, lifting the yield to 2.023%, while the U.S. dollar index was behind by 0.7% to $79.166.

-- Written by Chao Deng and Andrea Tse in New York.



>To contact the writer of this article, click here: Andrea Tse.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

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
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, 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
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,042.87 -55.58 -0.33%
S&P 500 2,000.20 -3.17 -0.16%
NASDAQ 4,588.4420 +8.1710 0.18%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs