U.S. Indexes Rebound More than 2%; Gold, Oil Gain 1.3%

Bikram Pandey
09 Aug, 2011
New York City

The S&P 500 and the Nasdaq soared as high as 3.5% ahead of the Fed meeting this afternoon. The confidence was recovered after stocks fell the most in 32 months but trading volume lagged market expectations. European markers rebounded and oil and god gained.

[R]12:10 PM – The S&P 500 and the Nasdaq soared as high as 3.5% ahead of the Fed meeting this afternoon. The confidence was recovered after stocks fell the most in 32 months but trading volume lagged market expectations. European markers rebounded and oil and god gained.[/R]

The U.S. indexes soared at the opening as bargain hunters returned and optimism recovered on the hopes of another Fed action after a one day meeting today.

The Dow, the S&P 500 and the Nasdaq in a roller coaster ride traded between 1% and 3% but the rally may fizzle as volume lagged the expectations. The oil and gold gained but the dollar edged lower.

The Dow rose 211.84 or 2% to 11,021.69, the S&P 500 index added 19.14 or 1.7% to 1,138.01 and the Nasdaq rebounded 2.3% or 55.51 to 2,413.35.

The indexes in Paris, Frankfurt, Stockholm and Zurich fell as much as 3% in the morning and recovered to hug the flat line or above.

In the European trading indexes recovered but undertone in the region was cautious. The euro traded near the lows against the Swiss franc and edged higher against the dollar.

The European Central Bank was buying the bonds of Spain and Italy for the third day in a row and the purchase may have been as high as 8 billion euros.

Italian 10-year bond yield dropped 19 basis points to 5.15% and Spanish bond yield fell 18 yields to 5.04%.

The indexes in Japan and elsewhere in Asia declined tracking the losses in overnight losses. The benchmark index in Japan plunged as much as 4.8% but recovered to close down 1.7% and in Australian gained more than 1.2%.

Gold gained 1% to $1,675.50 an ounce and oil gained $1.23 to $83.035 a barrel.

Stock Movers

AOL Inc. ((AOL)) slumped 16% or $2.42 to $12.65 after the web services provider said second quarter total revenues fell 6% to $542.2 million from $592.2 million in the same quarter last year. Net loss in the quarter tumbled 99% to $11.8 million or $0.11 per diluted share compared to $1,055.0 million or $9.89 per share a year ago.

Booz Allen Hamilton Holding Corporation ((BAH)) increased 7.7% or $1.17 to $16.20 after the holding company first second quarter revenue increased 7.8% to $1.45 billion from $1.34 billion in the same quarter last year. Net income in the quarter increased to $51.1 million or 37 cents per diluted share compared to $28.2 million or 23 cents per share a year ago.

Fossil, Inc. ((FOSL)) slumped 18.8% or $17.67 to $76.21 after the fashion accessories designer reported second quarter net sales soared 35% to $556.7 million from $412.6 million in the same quarter last year. Net income in the quarter fell 5.7% to $51.4 million or 80 cents per diluted share compared to $54.5 million or 80 cents per share in the prior-year quarter.

International Flavors & Fragrances Inc. ((IFF)) increased 5.5% or $2.94 to $55.76 after the fragrance products maker reported second quarter revenue increased 7% to $716 million from $666 million in the same quarter last year. Net income in the quarter increased 13% to $76.2 million or 93 cents per diluted share compared to $67.1 million or 83 cents per share a year ago.

Sempra Energy ((SRE)) fell 0.1% or 7 cents to $45.52 after the holding company reported second quarter revenue increased to $2.42 billion from $2.01 billion in the same quarter last year. Net earnings in the quarter increased to $511 million or $2.12 per diluted share compared to $222 million or $0.89 per share a year earlier.