Stocks Push Higher After Treasury Auction
Stocks pushed higher Tuesday after a $44 billion two-year note auction and a better-than-expected existing-home sales report. Health care gave back some of its gains after the prior session's rally.
The Dow was up about 50 points, topping 10,800, led by Kraft , JPMorgan and Pfizer.
The S&P 500and Nasdaq were also higher but have struggled to stay in positive territory today.
This came after stocks rose Monday, sending the Dow to another 1 1/2-year highas investors were relieved that uncertainty surrounding health-care reform was lifted with the weekend passage of the bill. The President signed the legislation earlier today.
The Treasury's two-year auction had a high yield of 1.000 percent and a bid-to-cover ratio of 3.00.
Existing-home sales fell 0.6 percentin February, smaller than the 2 percent expected and the 7.2-percent drop in January.
In the morning's earnings news, homebuilder KB Home reported a large-than-expected loss for its latest quarter.
Drugstore chain Walgreen also missed its target but investors cheered theimprovement in its margins.
There was some profit-taking in health care, after the sector led Monday's advance on the prospect of 32 million more patients being added to the health-care system with the passage of the health bill.
Humana , WellPoint and Aetna were all lower.
Bank stocks were mixed: The big banks were mostly higher, while the regionals slipped.
Citigroup was up more than 1 percent, after gaining 4 percent on Monday as Rochdale analyst Dick Bove upgraded his rating on the stock to "buy" from "neutral," saying the company has enough liquidity to offload problem assets and support long-term growth.
Citigroup "will be a money-making machine again and the stock is long-term cheap," Bove said.
In some early deal news, aircraft components maker Triumph Group has agreed to acquire Vought Aircraft Industries from Caryle Group in a deal worth $1.44 billion that includes 7.5 million shares and $525 million in cash.
Asian stocks ended mostly higher as resource companies gained on firm commodity prices. European stocks were also in the green with insurance companies performing well.
The Treasury is set to auction $44 billion 2-year notes Tuesday, with results available shortly after 1 pm. That will be followed by a sale of $42 billion in 5-year notes Wednesday and $32 billion in 7-year notes on Thursday.
Federal Reserve speakers are prominent on the day's agenda. Chicago Fed President Charles Evans told a Shanghai audience that Fed policy will remain accommodative for at least several months more. Philadelphia Fed President Charles Plosser and San Francisco Fed President Janet Yellen are also scheduled to speak.
Investors will keep an eye on Google, following its move to redirect Chinese Web site traffic to its Hong Kong site, thereby sidestepping its censorship dispute with China.
Toyota has raised its global production plans for this year by one percent to 7.57 million vehicles, according to Reuters. Its well-publicized troubles aside, Toyota has been helped by subsidy-led demand for fuel efficient cars in Japan.
TUESDAY: Existing-home sales; two-year Treasury auction; Fed's Yellen speaks; Earnings from Adobe after the bell
WEDNESDAY: Weekly mortgage apps; durable-goods orders; new-home sales; weekly crude inventories; Fed's Hoenig speaks; five-year auction
THURSDAY: Toyota class-action hearing; weekly jobless claims; Fed's Pianalto speaks; seven-year auction; Earnings from Best Buy and Oracle
FRIDAY: Final read on Q4 GDP; consumer sentiment; Fed's Warsh, Bullard speak
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