The bond markets were closed and there was no economic data to report on this quiet Columbus Day. But stocks staged a monster rally. First, the scoreboard:
Dow: +330, +3.0%
S&P 500: +39, +3.4%
NASDAQ: +87, +3.5%
And now, the top stories:
- Markets applauded yesterday’s promise by German Chancellor Angela Merkel and French President Nicolas Sarkozy to unveil a solution to the Eurozone debt crisis by the end of the month.
- France and Belgium structured a $125+ billion bailout of Dexia, which also offered some relief to the financial markets.
- Fitch downgraded Spain’s long-term guaranteed debt rating today, but this didn’t have nearly the unfavorable impact as their downgrade on Friday.
- The Euro jumped more than 2% against the dollar today, the largest one-day gain since March 2009.
- Commodities surged on the increased risk appetite and the decline in the dollar. Oil futures climbed 3%. Gold, silver, and copper all jumped.
- The financial sector led the rally benefiting from renewed confidence in Europe. Citigroup soared 8%. Morgan Stanley jumped 7%. Bank of America and Wells Fargo each gained 6%.
- Apple shares closed up 5% on word that the company booked a million iPhone 4 pre-orders on the first day it was available.
- Meanwhile, smartphone competitor Research In Motion traded lower after its BlackBerry service in Europe, the Middle East, and Africa went down.
- Sprint got slammed today by multiple downgrades by analysts who were concerned the company would soon run out of money. S&P even came out and put the company on credit watch.
- Netflix initially jumped on news that it scrapped its highly criticised plan to split its DVD rental and online streaming services. However, that rally was short-lived as the stock ended the day deep in the red.
- Overall, it was a quiet day for news. Activity should really pick up once Q3 earnings season kicks off with Alcoa tomorrow afternoon.
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