Stocks Groove as Facebook, Amazon, Viacom Sizzle
NEW YORK (TheStreet) -- U.S. stocks moved higher Thursday amid signs of ongoing economic growth and a spate of solid corporate earnings from Facebook (FB), Viacom (VIA) and Alexion (ALXN). Gold and bond prices fell, indicating a respite from risk aversion triggered by emerging market growth concerns.
- The S&P 500 jumped 1.13% to 1,794.19, while the Dow Jones Industrial Average was 0.7% higher at 15,848.61. The Nasdaq gained 1.77% to 4,123.12.
- The U.S. economy grew 3.2% in the fourth quarter as spending rose by the most in three years.
- "It [gain in stocks] was confirmation that the U.S. economy is strong and that despite the government shutdown in the fourth quarter, there was consumer pick up," Paul Mangus, head of equity strategy and research at Wells Fargo Private Bank, said in a phone interview. "We didn't have any additional news coming out of the emerging markets today that would draw investors' attention from the U.S. markets."
- Initial jobless claims rose by 19,000 in the week of Jan. 25 to 348,000, higher than the 330,000 estimate.
- Domestic contracts to purchase existing homes fell more than expected in December amid poor weather and rising borrowing costs. Pending home sales saw their biggest decline since May 2010, dropping 8.7%, the National Association of Realtors said Thursday.
- Top gainers in the S&P 500 included Alexion Pharmaceuticals (ALXN), which added 21.1% after posting a lift in fourth quarter sales, while announcing it will move operations to Ireland to avoid higher U.S. corporate taxes. Facebook added 14.1% to $61.05 after the world's largest social network reported that more than half of its advertising revenue came from mobile devices in the last quarter of 2013. And Pitney Bowes (PBI) -whose share price has more than doubled over the past year - increased 19% to $25.85 after beating earnings expectations.
- Shares in media company Viacom (VIA) rose 3.7% after it posted a 16% rise in profit. However revenue fell, fueling concerns about soft domestic advertising sales.
- Both Amazon.com (AMZN) and Google (GOOG) gained 4.9% and 2.6%, respectively. Amazon reported a fourth-quarter profit of 51 cents a share on revenue of $25.59 billion. Analysts anticipated earnings of 66 cents a share on sales of $26.06 billion. Google is predicted to report fourth-quarter earnings of $12.21 a share on revenue of more than $16.75 billion after Thursday's closing bell. On Wednesday the company reached an agreement to sell its Motorola Mobility business to Lenovo in a deal worth $2.91 billion.
- Exxon Mobil (XOM) was off 1.2% after the oil major reported a 16% decline in fourth-quarter earnings to $8.35 billion, or $1.91 a share, missing estimates by a penny. 3M (MMM) lost 1.7% after reporting in-line earnings of $1.62 a share on sales that were a touch below forecasts. UPS was rising after the shipping giant predicted that 2014 earnings will increase 11% to 16% year-on-year
- Germany's DAX rose 0.39% while the FTSE was off 0.1%. The Hang Seng closed off 0.48% while the Nikkei finished 2.45% lower.
-- By Jane Searle and Joe Deaux in New York
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