Earnings
news, cheaper oil inspire market - A price decline of almost
3 percent for crude improves investor confidence in spending
A steep drop in crude oil prices and better-than-expected
earnings from Goldman Sachs Inc. helped push stocks sharply
higher Tuesday.
The rally helped lift the Dow Jones industrial average
to a four-month high and the Nasdaq composite index and
Standard & Poor's 500 index to three-month highs.
The decline of almost 3 percent sent crude prices to
their lowest settling price since late March and boosted
investor confidence in the notion that a drop in energy
prices could result in a rebound in consumer spending.
Shares of consumer-related issues, such as General Motors
Corp., jumped. GM closed at $33.23, up $1.39, or 4.37
percent, after reaching a 52-week high of $33.24. Ford
Motor Co. gained 35 cents, or 4.02 percent, to $9.06.
Locally, Embarq Corp. reached a third-consecutive record
high at $49.06 and Capitol Federal Financial reached a
52-week high at $35.21.
Overland Park-based Embarq, which began trading at $44.50
on May 18 after its spin-off from Sprint Nextel Corp.,
closed at $48.91, up $1.45, or 3.06 percent. In the previous
two sessions, Embarq shares reached record highs of $47.90
and $47.80, respectively. Sprint closed Tuesday at $16.73,
up 25 cents, or 1.52 percent.
Topeka-based Cap Fed closed at $35.14, up 16 cents, after
passing the previous 52-week high of $35.10 set Sept.
6.
Overall, the Dow rose 101.25 points, or 0.89 percent,
and closed at 11,498.09, while the S&P 500 was up
13.57 points, or 1.04 percent, at 1,313.11. The Nasdaq
composite index rose 42.57 points, or 1.96 percent, and
closed at 2,215.82.
Oil prices fell for the seventh consecutive day, falling
$1.85 a barrel to $63.76 on the New York Mercantile Exchange.
That's the lowest close for crude since late March.
Investors saw positive momentum from financial services
stocks after Goldman Sachs reported better-than-expected
results during the third quarter, although profits fell.
Not only did that bode well for rival investment banks
due to report this week, but also signaled that companies
have not pulled back from going to the markets with equity
deals.
"So far, September is not acting all that bad and
basically what we're seeing is a range-bound market, which
means that investor appetite for stocks isn't diminishing,"
said Peter Cardillo, chief market analyst at S.W. Bach
& Co..
Stronger consumer sentiment also boosted Home Depot,
which added $1.60, or 4.56 percent, to $36.66. Best Buy,
which reported second-quarter profit rose 22 percent,
advanced $4.37, or 9.15 percent, to $52.14.
The nation's largest consumer electronics retailer beat
Wall Street projections.
Goldman beat Wall Street projections for the third quarter,
although profit fell as its trading business slowed. Goldman
rose $7.29, or 4.83 percent, to $158.29.
Among local companies:
Applebee's International Inc. was up 69 cents, or 3.12
percent, at $22.81. Chairman Lloyd Hill is scheduled to
ring the opening bell for the Nasdaq today to celebrate
the launch of the book Applebee's America.
Great Plains Energy was up 31 cents, or 1.01 percent,
at $30.90. Its Kansas City Power & Light unit said
its $166 million wind farm near Spearville, Kan., was
up and running.
NovaStar Financial Inc. was up $2.13, or 7.54 percent,
at $30.38. Its NovaStar Mortgage unit has agreed to buy
the retail operations and other assets of Indiana-based
Oak Street Mortgage LLC.
