US stocks climbed today as energy shares bounced with oil prices, while news Pfizer would buy Hospira in a massive deal further boosted the market.
The S&P energy index jumped 1.5 percent as oil prices rebounded sharply from a rout in the previous session. US crude rose 4.2 percent to settle at $50.48 following increased violence in producer Libya and on an expected boost in oil demand from China’s central bank easing.
Some euro zone concerns eased as well. Greece proposed a bridging program until the end of May to allow time for debt talks, vowing to do everything in its power to avoid default. On Wednesday, the European Central Bank abruptly said it would stop accepting Greek bonds in return for funds.
The day’s move put the S&P 500 back into positive territory for the year after days of volatile price action, largely driven by moves in oil.
Pfizer was among the biggest boosts to the S&P 500 after it said it would buy Hospira Inc for about $15 billion to boost its portfolio of generic injectable drugs and copies of biotech medicines. Hospira shares rocketed 35.2 percent to $87.64 as the S&P 500’s biggest percentage gainer. Pfizer gained 2.9 percent $32.99.
The Dow Jones industrial average rose 211.86 points, or 1.2 percent, to 17,884.88, the S&P 500 gained 21.01 points, or 1.03 percent, to 2,062.52 and the Nasdaq Composite added 48.39 points, or 1.03 percent, to 4,765.10.
Greek shares dropped, holding back European stock markets, after the European Central Bank abruptly cancelled its acceptance of Greek bonds in return for funding.
Greek banking stocks sank, with the Athens Stock Exchange FTSE Banks Index dropping 10 percent, driving Greece’s broader ATG equity index down by 3.4 percent.
Shares in National Bank of Greece fell 12.3 percent and Bank of Piraeus declined 15 percent. Greek shares regained some ground after the ECB let the Greek central bank offer lenders emergency funding of up to 60 billion euros ($68.6 billion).
Bank of Piraeus and National Bank of Greece were the worst performers on the broader, pan-European FTSEurofirst 300 index , which closed flat at 1,487.81 points. The euro zone’s blue-chip Euro STOXX 50 index fell 0.2 percent.
Software developer Dassault Systemes rose 8 percent to finish as the FTSEurofirst’s best performer after the company forecast further growth this year.
Meanwhile, Japan’s Nikkei share average dipped on news of the European Central Bank’s hardline stance on Greek debt and fresh falls in oil prices, while investors took profits in Toyota and some others after their unsurprising earnings.
Hitachi dived more than 10 percent after its earnings failed to meet investors’ high expectations, although Sony jumped more than 10 percent after forecasting smaller losses.
The Nikkei share average dropped 0.6 percent to 17,577.23, turning negative on the week.
Many market participants say few investors have appetite to buy the Nikkei above 17,500 and towards 18,000 noting that its valuation is hardly cheap. Hurting sentiment was an abrupt move by the European Central Bank to stop accepting Greek government bonds as collateral for funding in what many saw as retaliation for the Greek government abandoning its aid-for-reform program.
Oil prices crashed yesterday, with US crude losing 9 percent, dashing hopes that oil prices are finally bottoming out after many months of decline. Investors are also taking profits following earnings announcements.
Toyota Motor fell 1.7 percent after the carmaker lifted its operating profit guidance in a widely expected move. One of the biggest movers among large-cap shares was Hitachi , which fell as much as 11.4 percent after the company did not raise its annual profit estimate despite expectations it would do so.
By contrast Sony rose as much as 11.7 percent after it said its net annual loss will likely be smaller than previously forecast on cost cuts and strong sales of its image sensors and PlayStation video game consoles.
Earning announcements remain a big focus, with companies including Toray, Takeda Pharmaceutical and Nikon due to publish earnings later in the day. The broader Topix fell 0.6 percent while the JPX-Nikkei Index 400 dropped 0.8 percent.
Source: Buenos Aires Herald