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U.S. stocks higher, Apple continues to rise; Dow Jones up 0.06%

Published 08/21/2012, 09:46 AM
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Investing.com - U.S. stocks opened higher on Tuesday, as market sentiment was boosted by new hopes for action by the European Central Bank to tackle the sovereign debt crisis in the euro zone, while investors eyed the minutes of the Federal Reserve’s latest meeting on Wednesday.

During early U.S. trade, the Dow Jones Industrial Average added 0.06%, the S&P 500 index rose 0.21%, while the Nasdaq Composite index climbed 0.40%.

Sentiment improved after the U.K.’s Telegraph newspaper said earlier that it could confirm weekend reports that the European Central Bank may set a cap on peripheral euro zone bond yields at its next policy meeting in September.

On Monday, the ECB dismissed the reports, saying it was “misleading” to report on decisions which have not yet been taken.

Speculation over the possibility of ECB intervention saw Spanish borrowing costs fall at an auction of short-term government debt, with Madrid successful auctioning EUR4.5 billion of bills, the top end of the target range.

Market participants were also anticipating the minutes of the Fed’s August policy meeting, amid speculation over how close the U.S. central bank may be to implementing another round of stimulus measures.

Apple saw shares jump 1.29% after the tech giant became the most highly valued public company ever by reaching USD665.15 on Monday, giving the company a market value of USD623.52 billion.

Separately, chief executives of Apple and Samsung Electronics reportedly failed to settle their patent dispute, placing the final decision in the hands of a jury.

Financials stocks also added to gains, as U.S. lenders tracked their European counterparts sharply higher. Shares in JP Morgan surged 1.66% and Citigroup rallied 1.60%, while Bank of America and Goldman Sachs advanced 1.67% and 0.71%.

On the downside, Facebook shares tumbled 1.75%, after a regulatory filing showed that director Peter Thiel sold roughly USD400 million worth of shares in the Internet social networking company last week, cashing out most of his stake.

Elsewhere, Best Buy plunged 8.59% after the struggling consumer-electronics retailer posted a decline in same-store sales. On Monday, the company named Hubert Joly as its new CEO.

Meanwhile, founder Richard Schulze rejected an offer from the board to conduct due diligence in his attempt to take the company private at a valuation of more than USD8 billion.

Also in the retail sector, Urban Outfitters skyrocketed 15.66% after posting second- quarter profit that topped analysts’ estimates.

Other stocks in focus included Dell, expected to issue earnings after the closing bell.

Across the Atlantic, European stock markets were higher. The EURO STOXX 50 advanced 0.45%, France’s CAC 40 climbed 0.61%, Germany's DAX rose 0.48%, while Britain's FTSE 100 added 0.40%.

During the Asian trading session, Hong Kong's Hang Seng Index dipped 0.02%, while Japan’s Nikkei 225 Index added 0.16%.

Trade looked likely to remain subdued on Tuesday, with no significant economic data releases on the calendar, while volumes were light with many market participants on summer holidays.


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