Stocks rise on earnings pop and Fed liquidity injection

Thursday, October 23, 2014 -

U.S. stocks rose on Thursday after Wednesday’s decline on strong earnings reports from Caterpillar and 3M.

After yesterday’s strong sell off, stocks reversed their course today and reclaimed the losses and then some, moving back above yesterday’s pullback and extending the rebound rally.

The Dow jumped 217 points (+1.3%) to 16,678, the Nasdaq soared 70 points (+1.6%) to 4,453 and the S&P 500 surged up 24 points (+1.3%) to 1,951. The NYSE finished at +1.09% and the small cap Russell 2000 at +1.79%.

The major European markets also moved to the upside on the day. While the U.K.’s FTSE 100 Index only edged up by 0.3 percent, the German DAX Index and the French CAC 40 Index jumped by 1.2 percent and 1.3 percent, respectively.

News of a possible Ebola case in New York City pulled the major averages down off their highs in late-day trading, but they remained firmly positive, partly reflecting a positive reaction to upbeat earnings news from a number of big-name companies, including Caterpillar and 3M.


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Fed Dealer Banks Push Prices Up

U.S. stocks came off their session highs on Thursday, but the main benchmarks still closed with solid gains led by cyclical stocks, such as industrials and the energy sector. Crude oil bounced $1.57 to $82.09 a barrel on nearest future contract helping the oil stocks rebound.

Caterpillar and 3M beat earnings expectations helping to continue the rally. Also, I want to point out yesterday there was no Fed POMO liquidity injections, but today we had a $1.49 billion POMO day, which pushed the S&P 500 nearly to its 50-day moving average (key resistance) at 1966.

In typical earnings season action, the Fed once again helps . . .

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