Stock Market News for July 26, 2010 - Market News

Fed Chairman Bernanke’s Wednesday assessment that the economic outlook is “unusually uncertain" failed to deter investors and stocks ended the week on a positive note as reassuring news on European banks’ health and a number of upbeat earnings reports gave traders reasons to buy stocks. The euro gained after seesawing initially, as the stress tests results showed Europe’s big banks were not in as bad a condition as thought earlier.

The Dow industrials rallied, taking their two day advance to an impressive 300 points as component General Electric Co. GE announced that it will boost dividend by 20% and also start buying back shares.  Meanwhile, the stress tests on 91 European banks showed all but 7 of them will be able to weather a crisis, should there be any.  Five of those that ‘failed’ the test are Spanish banks.

The mergers and acquisitions front agant witnessed activity, this time with reports that France’s Sanofi Aventis SNY is planning to acquire biotech Genzyme Corp. GENZ.  The report sent shares in Genzyme up 15.4%. 

The advance Friday put the DJIA just below where it started the year.  The 30-share index added 102.32 points, or 1%, at 10424.62, up 3.2% for the week.  The Nasdaq Composite index advanced 1.1% to 2269.47, up 4.2% for the week and is now in the positive territory for the year.  The S&P 500 finished above 1100, a key technical level, for the first time in a month. The S&P’s rise above 1100 was a signal that stocks are in now in a bullish territory. 

Gains among the S&P 500 industry sectors were broad based, with basic materials (up 8.1%) leading the charge. Industrials followed with a 6.9% advance.  All other sectors, except healthcare (-0.5%), recorded gains on the week.  As risk sentiment strengthened, crude prices gained 3.9% copper prices jumped 8.7%.

According to 3M MMM CEO, "There will be possibly a period of slower growth beginning in end markets later this year...This is not a double dip per se...It's just a soft spot and very normal as economic growth takes a breather for a while and adjusts to new circumstances."

Even as reports says BP CEO Tony Hayward’s days at BP BP are numbered, traders will look to the company’s earnings for signs of its health.  Boeing BA also reports its numbers and so do ExxonMobil XOM, Sony SNE and Visa V.