Stocks Rally Ahead of Potential Fed Decision

Michael Teague |

Stocks rallied in Monday trading following one of Wall Street’s worst weeks of 2013, as investors put on a brave face ahead the possibility that Wednesday will see the Federal Reserve finally announce the much-dreaded reduction of its asset purchasing program, known as Quantitative Easing.

Come what may out of the Fed at the conclusion of Wednesday’s Open Market Committee meeting, the central bank had ostensibly good news for investors on Monday, saying that industrial production for the month of November rose 1.1 percent, the largest gain in exactly a year.

The Standard & Poor’s 500 index was up 0.63 percent to 1,786.54, while the Dow Jones Industrials were 0.82 percent higher at 15,884.57, and the NASDAQ was up 0.71 percent to 4,029.52.

The S&P 500 was topped by semiconductor manufacturer LSI Corporation, whose shares were up a whopping 38.6 percent on news that the data-storage company would be acquired by data-storage firm Avago Technologies (AVGO) . Techs rose on the day’s heaviest trading on the benchmark index, with EMC Corporation (EMC) , Cisco Systems (CSCO) , and Oracle Group (ORCL) all higher by the closing bell.

On the Dow, IBM (IBM) jumped nearly 3 percent on uncharacteristic, and unexplained, volume, but one of the index’s most notable stories was ExxonMobil (XOM) , also up nearly 3 percent in afternoon trading before paring back gains slightly after Goldman Sachs (GS) upgraded the stock from “neutral” to “buy”.

Aside from a broad rally in tech shares, the NASDAQ saw a number of impressive performances from healthcare stocks, with Solta Medical Inc. (SLTM) rising nearly 40 percent on news of its acquisition by Valeant Pharmaceuticals (VRX) . Cubist Pharmaceuticals (CBST) was 4 percent higher after promising results from clinical trialsof one of its antibiotic treatments, while Novavax Inc. (NVAX) and NuPathe Inc. (PATH) were up 20 and 47 percent respectively.

Ailing insurer Tower Group Inc. (TWGP) rose nearly 7 percent as the company’s financial situation is slowly turning out to be not quite as severe as had been previously thought.

Investors looking for ways to play the European economic recovery will want to have a look at Equities.com’s guide to European Exchange Traded Funds.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Companies

Symbol Name Price Change % Volume
ORCL Oracle Corporation 40.52 0.17 0.42 11,219,098
IBM International Business Machines Corp 166.52 1.16 0.70 3,146,930
VRX Valeant Pharmaceuticals International Inc. 15.46 0.02 0.13 9,223,041
AVGO Broadcom Limited 179.09 8.38 4.91 7,574,371
CSCO Cisco Systems Inc. 30.06 0.11 0.37 21,361,984
GS The Goldman Sachs Group Inc. 241.85 0.40 0.17 5,456,047
NVAX Novavax Inc. 1.46 0.03 2.10 14,550,572
XOM Exxon Mobil Corporation 89.00 0.68 0.77 8,021,683
EMC EMC Corporation n/a n/a n/a 0
IVRVF InnVest Real Estate Investment Trust (New) Trust U n/a n/a n/a 0

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