Stocks opened higher Thursday, looking to advance for a fifth straight session, fueled by earnings, market rallies in Japan, Hong Kong and Europe, and early declines in both bonds and the dollar.
X The Dow Jones industrial average rallied 0.8%, enough to drive it back above the 25,000 level. The Nasdaq composite jumped 0.6% and the S&P 500 index climbed 0.5%. The Dow and S&P 500 are trying to retake their 50-day lines after the Nasdaq did so on Wednesday.
Markets received a heavy early dose of mixed economic news, beginning with first-time unemployment claims that edged up to 230,000 in the week ended Feb. 10, according to the Labor Department. That was above the prior week’s 223,000 claims and basically in line with views for an uptick to 229,000. The four-week moving average jumped to 228,500, up from 225,000.
Prices paid to producers rose 0.4% in January, up from no increase in December and in line with economist consensus projections. Core prices, minus energy and food, also rose 0.4% — above the consensus estimate for a 0.2% gain.
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Mid-Atlantic-region manufacturing accelerated unexpectedly in February, sending the index for the Philadelphia Federal Reserve’s Manufacturing Business Outlook Survey to 25.8, up from 22.2 in January and confounding forecasts for a decrease to 21. Demand for manufactured goods rose sharply, the report said, but costs also rose broadly, sending the prices paid index to its highest level since May 2011.
The New York Federal Reserve’s Empire State Manufacturing Survey eased to a February reading of 13.1, down from 17.7 in January. Consensus views had projected only a slight slip, to 17.5.
At 9:15 a.m. ET, the Federal Reserve releases its January factory output estimates, followed at 10 a.m. ET by the February builders confidence survey from the National Association of Home Builders.
Cisco Jumps On Results; Berkshire Takes Bigger Bite Of Apple
Nearly all 30 Dow Jones stocks traded higher, as Cisco Systems (CSCO) thundered up 5.2% to a 17-year high. The network gear megalith’s fiscal second-quarter results topped targets late Wednesday, with third-quarter guidance coming in above consensus views as the company launched a $25 billion share buyback. Cisco is looking to add a fifth day to its rebound from 10-week support.
Apple (AAPL) punched up 2.1%, asserting a positive influence across the market. Regulatory filings showed both Berkshire Hathaway (BRKB) and Appaloosa Management raised their stakes in Apple through the end of December. Appaloosa held 3.1 million shares at the end of the month. Berkshire reported adding 31.2 million shares, bringing its stake to 165.33 million.
Apple is looking for a fifth straight advance after rebounding from a low Friday. Shares are set for a test of resistance at the stock’s 50-day moving average.
Netflix (NFLX) jumped 1.6%, setting the pace once again for the FANG stock tech leaders. The streaming video pioneer is also looking for a fifth straight advance as it consolidates below its Jan. 29 high.
Netherlands-based Yandex (YNDX) dialed in a near-7% advance. The largest search engine service on Russia’s internet reported fourth-quarter earnings and revenue above expectations. Yandex is in the process of integrating Uber’s Russian operations into its Yandex/taxi unit, after acquiring the Uber assets for for $3.7 billion in November.
Yandex shares are rebounding from a pullback to test support at their 10-week moving average, and just beyond buy range from a flat base buy point at 35.42.
Chip stocks were mixed, but Xilinx (XLNX) trimmed its early gain to 0.45%. The stock may have received an early boost from positive early trade in Bitcoin and Bitcoin- and blockchain-related stocks. Xilinx triggered the automatic sell rule by diving more than 8% below a 75.245 buy point after a brief breakout in January. Shares remain below key levels of support.
Among IBD 50 stocks, Arista Networks (ANET) tacked on 1.6% ahead of its fourth-quarter report, due out after today’s close. The provider of cloud-based networking software is knocking out new highs after four straight advances, and is extended above a 245.75 buy point in a flat base.
Solar energy-sector stocks were busy in premarket trade, as SolarEdge (SEDG) beamed 20% higher after squarely topping analyst expectations in its fourth-quarter report late Wednesday. SolarEdge shares ended Wednesday 7% below a 39.75 buy point in a double-bottom base. But the base was a third-stage pattern and the stock’s Relative Strength line lagged well below its recent peak, two factors that add risk to any possible breakout.
SunPower (SPWR) tumbled 10% after reporting mixed fourth-quarter results. Oppenheimer also downgraded the San Jose, Calif.-based company to perform, from outperform. Shares have been struggling to regain 10-week support in a six-month consolidation.
Dollar, Bonds Slip; Europe Rallies As China Heads Into New Year
The dollar gave up ground in early trade, hanging near 15-month lows vs. the yen. Bonds continued lower, lifting the 10-year yield one basis point to 2.91%.
Hong Kong’s Hang Seng index bolted 2% higher, giving it a 5.4% rebound for the week as it heads into the Lunar New Year holiday. The Hong Kong Stock Exchange will close Friday and Monday. Markets in Shanghai and Shenzhen closed Thursday, and will re-open Feb. 22.
In Japan, Tokyo’s Nikkei 225 popped 1.5% in Thursday’s session.
European markets held their early gains. The CAC-40 in Paris led, up 1.4% afternoon trade.
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