This Day On The Street
Continue to site right-arrow
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 Under $10 with 50-100% upside potential - 14 days FREE!

Stocks Gain as Debt Deal Appears Attainable

Stocks in this article: ^DJI ^GSPC ^IXIC SWY TSO VLO

NEW YORK ( TheStreet) -- Major U.S. stock markets jumped Friday following yesterday's second-biggest gains of the year as signs of constructive discussions in Washington bolstered confidence the government won't allow the U.S. to default on its debt obligations.

The S&P 500 gained 0.63% to 1,703.19 after the benchmark's biggest jump since Jan. 2, while the Dow Jones Industrial Average added 0.73% to 15,237.11. The Nasdaq closed up 0.83% to 3,791.87

House Republicans offered to end the government nine-day-old government shutdown in exchange for budget cuts, according to reports from the Associated Press. Republican leaders have been pressing President Obama to cut funding for the Affordable Care and Patient Protection Act before they would agree to raise the limit on federal borrowing to pay for government expenditures and programs previously approved by Congress.

In equity trading, Safeway (SWY)was the most prominent gainer in the broad market as shares jumped 6.9% to $33.75 following the supermarket operator's announcement that it will by early 2014 exit the Chicago market where it operates 72 Dominick's stores and that the move will result in a cash tax benefit of $400 million to $450 million. Excitement swirling the announcement was helping to distract from its third-quarter misses.

Oil refiners such as Tesoro (TSO)and Valero Energy (VLO) also gained ground. Tesoro popped 3.8% to $45.19 while Valero jumped 2.7% to $36.53 supported by easing concerns about an economic fallout from the Washington debates and the impact on demand for refined petroleum products, as well as a proposal by the U.S. Environmental Protection Agency proposal to ease its ethanol mandate next year to a requirement that 15.21 billion gallons of ethanol and biodiesel be blended into motor fuels. That's down from the current 18.15 billion gallon requirement and would substantially reduce costs for oil refiners.

The benchmark 10-year Treasury was little changed, yielding 2.687%, while the one-month bill was climbing 1/32, diluting the yield to 0.261% after popping for much of the morning.

On Thursday evening, during a 90 minute discussion, House Republicans proposed a temporary, six-week increase to the debt limit so that the U.S. may keep borrowing money to pay its bills while a bigger deficit reduction deal was discussed. The president said he was open to further discussions and also urged for an immediate end to the government shutdown. A statement issued shortly before the market closed from House Speaker John Boehner's spokesman said the president and he agreed they should keep talking.

The Reuters/University of Michigan's consumer sentiment index indicated a drop to 75.2 in the preliminary October reading from 77.5 in September versus economists' average expectation of 76, reflecting the psychological impact of the tension in Washington as the government shutdown heads into its 11th day.

The S&P 500 rebounded from losses in the first half of the week, closing higher by 0.75%. The Dow gained 1.09% for the week, while the Nasdaq lost 0.42% for the five-day trading period.

-- Written by Andrea Tse and Joe Deaux in New York

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

Select the service that is right for you!

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 17,890.88 +86.08 0.48%
S&P 500 2,071.52 +0.87 0.04%
NASDAQ 4,770.8660 +5.4860 0.12%

Brokerage Partners

Rates from

  • 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