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U.S. stocks rise on Cyprus deal, eyes on Fed; Dow Jones up 0.18%

Published 03/25/2013, 09:42 AM
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Investing.com - U.S. stocks opened higher on Monday, as newfound optimism over the handling of Cyprus's financial woes after the announcement of a bailout deal boosted market sentiment.

During early U.S. trade, the Dow Jones Industrial Average added 0.18%, the S&P 500 index gained 0.37%, while the Nasdaq Composite index rose 0.30%.

Early Monday, euro zone finance ministers approved a EUR10 billion international bailout for Cyprus that will see the closure of the country’s second largest lender Laiki Bank and inflict heavy losses deposits of more than EUR100,000.

However, all bank deposits under EUR100,000 will be "fully guaranteed".

Investors remained cautious however, as concerns over the economic outlook for the euro zone and political uncertainty in Italy weighed.

Dell surged 3.08%, as a special committee of the company's board was said to be evaluating separate takeover proposals from Blackstone Group and billionaire investor Carl Icahn to decide whether either or both are likely to trump an existing USD24.4 billion take-private deal.

Financial stocks added to gains, as shares in Bank of America climbed 0.80% and JP Morgan advanced 0.81%, while Goldman Sachs and Citigroup jumped 1.04% and 1.08% respectively.

Reuters reported earlier that Bank of America Chief Executive Brian Moynihan will need to hold shares likely worth millions of dollars for at least a year after he retires under a new compensation policy.

Elsewhere, Apple rallied 0.98% after the tech giant acquired WiFiSlam, a startup company that makes mapping applications for smartphones.

In the same sector, Research in Motion saw its U.S.-trades shares plunge 6.91% after the smartphone maker's new BlackBerry Z10 launch failed to generate buzz. Separately, Goldman Sachs cut its rating on the company to "neutral" from "buy."

Among earnings, Dollar General surged 3.99% after the discount retailer posted earnings that beat expectations and said this year's sales growth could top the strength it saw in 2012.

In addition, Apollo Group soared 12.27% after the for-profit education company posted a better-than-expected profit and reaffirmed its full-year forecast.

Across the Atlantic, European stock markets were higher. The EURO STOXX 50 climbed 0.48%, France’s CAC 40 advanced 0.58%, Germany's DAX gained 0.60%, while Britain's FTSE 100 rose 0.56%.

During the Asian trading session, Hong Kong's Hang Seng Index gained 0.61%, while Japan’s Nikkei 225 Index surged 1.69%.

Investors were looking ahead to a speech by Federal Reserve Chairman Ben Bernanke later in the trading day.

Last week, the U.S. central bank announced that it will leave monetary policy unchanged in spite of recent signs that the U.S. recovery is gaining traction.


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