Stocks finished higher on Wednesday ahead of the Thanksgiving Day holiday. Oil prices fell on increased inventories, giving indications that there is plenty of crude oil around for winter needs. The latest reading on consumer sentiment rose.
The Dow Jones industrial average rose 44.66 points to 10,916.09. The broader Standard & Poor's 500 index was up 4.38 points to 1,265.61. The tech-heavy Nasdaq composite index gained 6.42 points to 2,259.98.
Crude oil was down 19 cents to $58.65 a barrel following weekly EIA inventory statistics which revealed a 400,000 barrel build in crude stocks. Gasoline inventories rose just 200,000 barrels, while distillate stocks rose 1.1 million barrels. Heating oil stocks rose 1.3 million barrels on the week, with the build likely to weigh on the entire NYMEX complex, says Action Economics.
Among stocks on the move, Research In Motion (RIMM), maker of the Blackberry, warned that new subscribers would come in lower than expected in the third and fourth quarters due to product launch delays. It cut its fourth-quarter forecast for subscriber additions of 775,000 to 825,000 by about 3%. The company reaffirmed its third-quarter revenue projection of $540 million to $570 million. The shares dropped in premarket trading.
In deal news, Sovereign Bancorp (SOV) revised a transaction to sell a big stake in itself to Spain's biggest bank Santander. The main changes to the deal include the scrapping of Santander's veto on the termination of Sovereign Chief Executive Officer Jay Sidhu and a requirement that any new CEO be reasonably acceptable to Santander, according to Reuters. The revised deal also deleted provisions for Sovereign directors to continue on the Sovereign board for an extra 10 years if Sovereign is bought outright by Santander, reports Reuters. While Sovereign's second-biggest shareholder, Franklin Mutual Advisers, was pleased with these changes, Sovereign's biggest stockholder, Relational Investors, said they were not enough to make it support the deal, says Reuters.
Independence Community Bank (ICBC) shares rose as the financing arrangement for Sovereign to acquire it remains on track.
In economic news, U.S. initial jobless claims jumped 30,000 to 335,000, well above median; 11,000 was due to Hurricane Wilma.
The final November reading for University of Michigan consumer sentiment improved to 81.6, from the 79.9 preliminary and 74.2 in October, according to newswires. This is a little stronger than expected. Strength was in the future outlook component, which rose to 69.6 from the preliminary 66.8 (63.2 October).
In Europe, London's FTSE-100, Germany's DAX, and France's CAC-40 indexes rose. In Asia, Japan's market was closed for a holiday. The Hang Seng index climbed 176.7 points to 15,062.35.
Treasury yields edged higher after Richmond Fed President Lacker says the FOMC still has some interest rate tightening to do, says Standard & Poor's MarketScope. The Treasury's $20 billion 2-year note sale was plain vanilla but was well bid under the circumstances, says Action Economics. The yield on the 10-year note rose to 4.47%.
The bond market will be closed Thursday and Friday, in observance Thanksgiving Day.