The Dow Jones Industrial Average (DJIA) and the Standard & Poor 500 (S&P 500) both gained 0.9% to close at 12,595.37 and 1,347.24, respectively. The Nasdaq finished the day at 2,847.54 after gaining 0.8%. The Dow recorded its highest close since June 5, 2008 and the S&P 500 closed at its highest level since June 17, 2008. For the Nasdaq, this was the highest close since October 31, 2007. For every three stocks that advanced, one stock was on the declining side on the New York Stock Exchange and consolidated volumes were at 4.1 billion shares. Since hitting a 12-year low in March 2009, the indices have now more than doubled. This historic recovery also marks the fastest bull-run since the 1950s.
A strong earnings season continue to lift sentiments and companies like Ford Motor Co. (NYSE:F - Analyst Report), 3M Co. (NYSE:MMM - Analyst Report), United Parcel Service, Inc. (NYSE:UPS - Analyst Report) and Cummins Inc. (NYSE:CMI - Analyst Report) reported strong quarterly results. Shares of these companies increased 0.8%, 1.9%, 0.9%, and 7.6%, respectively, and led the broader indices higher. Ford Motor announced its first quarter 2011 earnings with a roaring 48% rise in profit to $2.61 billion from $1.76 billion in the same quarter of 2010. On an earnings per share basis, profits rose 35% to 62 cents per share from 46 cents per share a year ago and topped the estimates. The profits were the highest in a decade and this is a turnaround performance with respect to the fourth quarter of 2010, when the automaker recorded a 24% fall in profit.
3M released its earnings results for the first quarter of 2011, reporting earnings per share of $1.49, beating the consensus estimate of $1.43. The company’s organic revenues improved in all of its six businesses. UPS’ shares soared after the world's largest package delivery company reported first quarter 2011 adjusted earnings of 88 cents per share, surpassing the consensus estimate of 85 cents. Earnings per share showed a substantial 24% growth from 71 cents in the year-ago quarter.
Cummins’ net income for the first quarter of 2011 was $343 million or $1.75 per share, rising significantly from the year-ago net income of $149 million or 75 cents per share. Reported earnings per share also exceeded the estimate of $1.44. Sales for the company amounted to $3.86 billion in the first quarter, up 56% from $2.48 billion in the same quarter last year primarily driven by the truck market recovery in North America, productivity enhancements and increased activities in the international markets.
However, Amazon.com Inc. (NASDAQ:AMZN - Analyst Report) and The Coca-Cola Company (NYSE:KO - Analyst Report) were among the few big names to disappoint investors with their unfavorable quarter results. Shares of these companies slipped 1.7% and 1.2%, respectively. Amazon.com marked the first negative earnings surprise since the second quarter of 2010. Revenues for the quarter, at $9.86 billion, managed to beat estimates but earnings per share came in only at 44 cents per share as opposed to the estimated 60 cents per share. Separately, Coca Cola reported earnings per share of 86 cents for the first-quarter of 2011, missing estimates by 1 cent. However, this was higher than the year-ago EPS of 69 cents by 24.63%.
Economic data also helped drive the markets higher as the Conference Board's index of consumer confidence recorded its second-highest level since the economic turmoil of 2008. The Consumer Confidence Index increased to 65.4 in April after decreasing to 63.8 in March from 72.0 in February. The index was expected to increase, with the consensus at 64.4. Consumers’ short-term outlook, which had soured in March, improved moderately in April.
For the markets, one of the most crucial events for the year will unfold today as Fed Chairman Ben Bernanke takes the podium to hold the first of four annual press conferences, which will expectedly reveal the fate of the $600-billion bond purchase program. Any decisions coming from the meeting will impact the movement of the markets, which have enjoyed their stay in positive territory till now this week. Market watchers believe that the meeting will bring the asset-purchase plan to a close. However, higher energy and food prices and a higher unemployment rate may force the extension of the plan. ( Source http://www.zacks.com ) For the latest updates PRESS CTR + D or visit Stock Market news Today
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