Stocks Gain as Alcoa Beats on Profit
NEW YORK (TheStreet) -- U.S. stocks closed higher on Monday on expectations quarterly earnings reports that begin this week will exceed forecasts.
The S&P 500 finished up 0.6% to 1,563.07 after posting the biggest weekly decline of the year last week. Aluminum maker Alcoa (AA), citing increased demand from U.S. carmakers, extended its gain in post-market trading after reporting net income that beat analysts' expectations.
Shares of Alcoa rose in after hours trading after the company said net income for the three months ended March 31 rose to 11 cents ex-items, from 10 cents a share during the same time last year, beating an 8 cent analyst estimate. Sales for the quarter fell to $5.83 billion from $6.01 billion a year ago, missing the $5.88 billion an average of analysts polled by Thomson Reuters.
Alcoa shares rose 1.8% to $8.39 during the regular session.The Dow Jones Industrial Average was off 0.31% to 14,566.91. The Nasdaq was gaining 0.25% at 3,211.89. BioCryst Pharmaceuticals (BCRX) surged 12.9% to $1.92 as the developer of anti-influenza drug Peramivir got a boost after China's Food and Drug Administration on Friday said it expedited its approval of the drug amid reports of rising bird flu infections in China. Lufkin Industries (LUFK) soared 37.6% to $87.96 after General Electric (GE) announced a deal Monday to buy the Lufkin, Texas-based oil services equipment manufacturer for $3.3 billion. EDAC Technologies (EDAC) slumped 4.3% to $17.73 after private equity firm MidOcean Partners on Sunday withdrew its $18.25 a share bid on the Farmington, Conn.-based aerospace and industrial applications components supplier for undisclosed reasons. No major U.S. economic releases were scheduled for Monday. Todd Salamone, vice president of research at Schaeffer's Investment Research in Cincinnati, said in a note Saturday that while April began with a whimper, things could have been worse given the amount of uncertainty plaguing the global markets. He said technical support levels remain resilient amid rising skepticism, with bulls still "quietly in control." Meanwhile, his colleague, Rocky White, a quantitative analyst at Schaeffer's Investment Research, wrote Saturday that although earnings season is being approached with skepticism, the skepticism suggests that companies will have a lower bar to jump. White's analysis of the most recent weekly sentiment survey released by the American Association of Individual Investors shows that 35.5% of investors are bullish, which also indicates some pessimism from investors. This "is good news for the upcoming earnings season." The benchmark 10-year Treasury was sliding 9/32, boosting to the yield to 1.746%. The dollar was rising 0.24% to $82.77 according to the U.S. dollar index. May crude oil futures settled up 66 cents to $93.36 a barrel on the New York Mercantile Exchange. Written by Andrea Tse and Joe Deaux in New York >To contact the writer of this article, click here: Andrea Tse.
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