Stocks Rise as Europe's Debt Crisis Shows Signs of Improvement

Strategic Insights -

U.S. stocks jumped at the open Thursday, bolstered by positive news from Europe's debt crisis. The Finnish Parliament's approval of a proposed overhaul of the European Financial Stability Fund, created last July, was a key factor. Eight of the 17 eurozone members have ratified the proposal. Investors saw this as a step towards resolving the crisis, which has been a major concern for the global economy. The Dow Jones industrial average surged 115 points, or 1%, and Microsoft, Boeing, and American Express were among the biggest gainers.

Key Takeaways:

  • The Finnish Parliament approved the proposed overhaul of the European Financial Stability Fund, created last July, which aims to provide low-cost loans to struggling EU countries.
  • Eight of the 17 eurozone members have ratified the proposal, showing progress in addressing the debt crisis.
  • The Dow Jones industrial average jumped 115 points, or 1%, with Microsoft, Boeing, and American Express being among the biggest gainers.
  • U.S. banks continued their three-day rally, with JPMorgan Chase, Bank of America, Goldman Sachs, and Citigroup all showing gains.
  • A government report on durable goods showed orders were down 0.1% in August, missing economists' expectations.
  • Family Dollar beat analysts' expectations, reporting quarterly earnings of 66 cents per share.
  • Darden Restaurants released quarterly results in line with analysts' expectations.
  • Investors are awaiting the release of Amazon's latest news, including the unveiling of the Amazon Kindle Fire tablet.

Statistics:

  • Dow Jones industrial average jumped 115 points, or 1%.
  • S&P 500 added 9 points, or 0.8%.
  • Nasdaq Composite gained 22 points, or 0.9%.
  • JPMorgan Chase, Bank of America, Goldman Sachs, and Citigroup were all higher in early trading.
  • U.S. banks continued a three-day rally.
  • Government report on durable goods showed orders were down 0.1% in August.
  • Economists had expected orders to tick up 0.1% in August.
  • Family Dollar reported quarterly earnings of 66 cents per share.

Sources:

  • NEW YORK (CNNMoney)
  • Kathy Lien, director of currency research at GFT
  • Peter Cardillo, chief market economist at Rockwell global capital
  • Government report on durable goods
  • Family Dollar quarterly earnings release
  • Darden Restaurants quarterly results