Stocks Rally on Altria's Record High Shares, Led by Tobacco Stocks

Strategic Insights -

Yesterday's session saw stocks rise despite lingering caution ahead of the employment report for June, thanks to a rally in tobacco stocks led by Altria's record high shares. The Dow Jones industrial average rose 0.66 percent, the S&P 500-stock index gained 0.25 percent, and the Nasdaq composite index edged up 0.08 percent. However, the broader market's gains were limited by a sell-off in shares of eBay and Apple Computer.

Key Takeaways:

  • Altria's shares rose 6 percent, or $4.43, to reach a record high of $79.10, making it the leading stock in yesterday's rally.
  • An index of tobacco stocks rose 1.8 percent, with Reynolds American shares increasing 4 percent, or $4.59, to close at $118.95.
  • eBay shares plummeted 5.3 percent, or $1.51, to close at $26.85, after the company announced changes to its PayPal payments unit.
  • Apple's shares dropped 2.2 percent, or $1.23, to $55.77, following news of a lawsuit over stock option grants and a competitor to the iPod music player.
  • Shares of companies closely tied to economic cycles rebounded, with 3M's stock rising 1 percent, or 84 cents, to $81.39.
  • Wal-Mart Stores' shares slipped 0.6 percent, or 30 cents, to $46.72, as mixed June sales were reported by major retailers.

Statistics:

  • 1.41 billion shares changed hands on the New York Stock Exchange, below last year's daily average of 1.61 billion.
  • 1.64 billion shares traded on Nasdaq, below last year's daily average of 1.80 billion.
  • The price of the 10-year Treasury security rose 10/32, to 9918/32.
  • The yield on the 10-year Treasury security fell to 5.18 percent, from 5.22 percent on Wednesday.
  • Altria's shares jumped 6 percent, or $4.43, to close at $77.76.

Sources:

  • Associated Press
  • Bloomberg Financial Markets
  • Merrill Lynch
  • Federal Home Loan Mortgage Corp.
  • Wedbush Morgan regional investment bank.