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Market Update

Record Intra-day in S&P 500 Index, Fitch Reaffirms U.S. Debt Rating


Author: Nichole Harper
ticker.com
Last Update: 1:42 AM ET March 21 2014

12:40 PM New York – Investors turned confident and bid up stocks. Fitch Ratings reaffirmed U.S. debt rating at AAA and revised the outlook to stable from negative. The S&P 500 index reached a new intra-day record and up 2.3% in the week so far. Media General agreed to acquire LIN Media for $1.6 billion.

Stocks opened higher and advanced further on Wall Street after the dollar gained and market indexes in Europe and emerging markets rose despite the rising tensions between Russia and NATO nations.

U.S. imposed additional sanctions on 20 Russians and on Bank Rossiya. Department of Treasury moved to freeze assets held with the U.S. institutions and barred U.S. citizens and businesses from doing business with those on the list.

Fitch Ratings today reaffirmed rating on the U.S. debt at AAA and removed the nation’s debt from its “negative watch” list. The rating agency also said the U.S. debt outlook is stable.

The U.S. has the largest sovereign debt in the world and federal government deficit has ballooned three times to $16.7 trillion at the end of 2013 from $5.6 trillion in 2000 and debt to GDP ratio has jumped from 55% to 99% in the period.

S&P 500 index increased 0.5% or 9.25 to 1,881.22 and the Nasdaq Composite Index increased 0.11 to 4,319.37.

Most market in Europe gained at least 0.3% and in India, Brazil, Korea and Australia traded higher.

Market indexes in Shanghai surged 2.7% and in Hong Kong gained as much as 3% on the rising speculation that the government is slowly loosening restrictions to lending to property developers and banks to sustain the slower economic growth.

The stocks surged the most in four months in Shanghai and in Hong Kong. Market in Tokyo were closed for a holiday.

Investors were cautious in India ahead of national elections but rupee strengthened on the expectations of falling inflation and a rebound in industrial production. The rupee edged up 0.7% to 60.92 against one dollar.

European Markets

In London trading, FTSE 100 index edged up 0.03% or 2.22 to 6,544.66 and in Frankfurt the DAX index gained 0.2% or 23.05 to 9,319.17.

In Paris, CAC 40 index rose 0.02% or 0.89 to 4,328.80.

U.S. Stocks in Review

Darden Restaurants, Inc (DRI) gained 2.5% or $1.22 to $50.52 after the restaurant operator reported flat sales in the third-quarter ending on February 23 at $2.23 billion.

Net earnings in the quarter dropped 18.4% to $109.7 million or 82 cents a diluted share compared to $134.4 million or $1.02.

The company added blended same-restaurant sales declined 5.6% at Olive Garden, Red Lobster and LongHorn Steakhouse. Same restaurant-sales decline of 0.7% for the Company''s Specialty Restaurant Group.

Endocyte, Inc (ECYT) surged 100.8% or $14.76 to $30.08 after the biopharmaceutical company said European Medicines Agency issued a positive opinion for Vynfinit, Folcepri and Neocepri as potential treatments for adult patients with folate receptor-positive platinum-resistant ovarian cancer.

Endocyte developed these therapies and licensed to Merck in the ex-US territories under a deal worth up to $1 billion in royalty payments.

Media General, Inc (MEG) increased 4% to $18.05 after the company agreed to acquire LIN Media LLC for $1.6 billion. With the merger, the combined company will be the second-largest independent TV network operator with a reach of 25% of the U.S. households.

Media General after the deal will follow the largest Tribune Co which acquired Local TV Holdings for $2.7 billion. Media General said it plans to sell some stations in markets where regulators may worry about larger penetration.

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Sources: Data collected by 123jump.com and Ticker.com from company press releases, filings and corporate websites. Market data: BATS Exchange. Inc