Stocks finished higher on Thursday amid hopes that Friday's retail sales and consumer sentiment numbers reflect an improving economy. Oil prices continued to decline.
The Dow Jones industrial average moved up 84.36 points, or 0.81%, to 10,469.84. The broader Standard & Poor's 500 index rose 10.57 points, or 0.91%, to 1,173.48. The Nasdaq composite index climbed 26.71 points, or 1.31%, to 2,061.27.
Trading was fairly active, and the major averages broke above short-term resistance levels, even though the government, banks, and Treasury markets were closed for the Veteran's Day holiday, notes Standard & Poor's MarketScope.
No major economic announcements were planned for Thursday. Updates on October retail sales, University of Michigan consumer sentiment, and business inventories will come on Friday.
In the energy markets Thursday, December NYMEX crude oil dropped $1.43 to $47.48 a barrel. There were reports that demand is lower than expected in China, and prices rose only briefly yesterday on short covering, suggesting that the oil market has not yet found a bottom, according to Standard & Poor's MarketScope.
Among the earnings announcements after the market close, PC maker Dell (DELL) announced third-quarter earnings of 33 cents, vs. 26 cents a share a year ago, meeting average estimates.
Agilent (A) posted earnings of 15 cents a share, vs. 3 cents a year ago.
Kohl's (KSS) announced third-quarter earnings of 42 cents per share, vs. 35 cents last year, in line with analyst estimates. The retailer says same-store sales rose 1.2%, and gross margins increased to 35.9% from 34.1%.
In corporate news, Coca-Cola (KO) dragged down the soft drink sector by announcing it would increase its investment in marketing and innovation by $350 million to $400 million, setting a 3% to 4% annual growth target. The beverage maker maintained its 2004 guidance, but said it expected weak results to persist in specific key markets in 2005. The shares fell by 6%.
On the merger front, video rental chain Hollywood Entertainment (HLYW) announced that Blockbuster (BBI) has expressed interest in acquiring the chain for $11.50 per share in cash. Hollywood Entertaiment stock traded up 12%, to $10.93 per share. Blockbuster shares rose by 11%.
PeopleSoft (PSFT) shares declined after the company's board voted unanimously to recommend stockholders to reject Oracle's (ORCL) unsolicited offer of $24 a share. The stock fell by 1.6%.
Nortel (NT) delayed filing its revised financial results in order to have more time to complete them. The network-equipment maker warned that its shares could be suspended from trading, and also said it expects 2004 revenue growth to be in the low single digits. Shares fell 5.9%
In other earnings news, Starbucks (SBUX) announced fiscal fourth-quarter earnings after the market close Wednesday, posting 25 cents in earnings per share, vs. 17 cents a year ago, meeting analyst estimates. Starbucks also said that 3 cents of its earnings were derived from the fact that its fourth quarter lasted an extra week this year. Shares rose 0.3%.
Target (TGT) announced a high quarterly profit, but missed analysts' consensus estimate by a penny. The second-largest discount retailer in the U.S. posted earnings per share of 60 cents, vs. 33 cents a year ago. The stock fell 0.2%.
Tiffany (TIF) posted 14 cents, vs. 19 cents, in third-quarter earnings per share after weaker-than-expected sales in China and higher precious metal and diamond costs offset a 7.2% sales rise. The jeweler also cut its fiscal year 2005 projections. Tiffany shares dropped 5.8%.
Further ahead on the earnings calendar, look for announcements by Lowe's Companies (LOW) and Jo-Ann Stores on Monday; Staples (SPLS), Hewlett-Packard (HPQ), Home Depot (HD), and Wal-Mart (WMT) on Tuesday; Medtronic (MDT) and Intuit (INTU) on Wednesday; and Gap (GPS), Walt Disney (DIS), and Novell (NOVL) on Thursday.
The bond market was closed for the Veteran's Day holiday Thursday. The benchmark 10-year note yield finished the session Wednesday at 4.25%.
The dollar continued to weaken toward all-time lows vs. the euro on Thursday, pushing above $1.29 per euro.
European stock markets finished higher Thursday as oil prices fell. London's Financial Times-Stock Exchange 100 index was up 42 points, or 0.9%, to 4,777.
Germany's DAX index shrugged off the announcment that Germany's third-quarter GDP rose by only 0.1%, rising 42 points, or 1%, to 4,131. In Paris, the CAC 40 index rose 49 points, moving to 3,833.
In Asia, the markets finished lower Thursday. Japan's Nikkei 225 index fell 148 points, or 1.4%, to 10,846, on poor machinery orders data. In Hong Kong, the Hang Seng index dropped 48 points late in the session, or 0.35%, to 13,624. The chairman of fashion retailer Esprit announced he would sell roughly 97 million shares of the stock at a discount.