Stocks move higher on hopes for budget deal

Topics: From the Wires,

Stocks move higher on hopes for budget dealFILE - In this Nov. 7, 2012, file photo, James Dresch of MND Partners Inc. works on the floor of the New York Stock Exchange in New York. Stocks declined for a third day on Wall Street Wednesday, Nov. 28, 2012, as investors waited for signs of progress on the "fiscal cliff." (AP Photo/Henny Ray Abrams, File)(Credit: AP)

Lawmakers kept Wall Street on its toes Wednesday as investors waited for signs of progress on the “fiscal cliff.”

Stocks shrugged off an early loss and were higher in early afternoon trading. As of 12:40 p.m. the Dow Jones industrial average was up 74 points at 12,951. It had been down as much as 112 points shortly after the opening bell.

The Standard and Poor’s 500 was up five points to 1,404. The Nasdaq composite was up 10 points at 2,977.

Huge tax increases and spending cuts will come into effect Jan. 1 if no deal is reached. Economists say the measures could push the U.S. back into recession. Democrat Erskine Bowles said Tuesday in a meeting that the White House was flexible on the level of top tax rates, according to the Wall Street Journal. That report bolstered expectations that a compromise could be reached.

“We’re all on pins and needles waiting for every bit of news, or rumors, coming out of Washington,” said Ryan Detrick, a Cincinnati, Ohio-based technical analyst at Schaeffer’s Investment Research. “That’s what’s Wall Street is focused on. Everybody is watching the fiscal cliff.”

Concern that the U.S. will go over the “cliff” has weighed on stocks since the Nov. 6 elections returned a divided government to power, with President Barack Obama staying in the White House and Republicans retaining control of the House.

In economic news Wednesday, U.S. sales of new homes dipped 0.3 percent in October though remain up 20.4 percent for the year, according to a government report. Stable home prices suggest the housing market is steadily recovering.

Investors will also look will also look to the Federal Reserve for indications about the strength of the economy. A Fed snapshot of business conditions around the nation, covering October through mid-November, will be published at 2 p.m.

The yield on the 10-year Treasury note fell to 1.62 percent from 1.64 percent.

Among stocks making big moves:

— Chipmaker Analog Devices fell 27 cents to $39.85 after it said sales fell 3 percent in the third quarter due to weak economic conditions and global uncertainty.

— Costco, the wholesale club operator, gained $4.50 to $101 after the company said that it would pay a special dividend of $7 a share next month, in addition to the regular quarterly dividend it pays shareholders.

— Green Mountain Coffee Roasters surged $6.84 to $35.80 after the beleaguered coffee company reported fourth-quarter results and guidance that far exceeded the market’s expectations.

Next Article

Related Stories

Featured Slide Shows

The week in 10 pics

close X
  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11
  • Lisa Montgomery embraces her nephew Thursday after a tornado tore apart her home in Cleburne, Texas. The twister killed six people and destroyed entire swaths of the North Texas town.
    Credit: AP/LM Otero

  • Jack McMahon, the defense attorney for abortion doctor Kermit Gosnell, speaks outside the Criminal Justice Center Philadelphia Tuesday. His client was convicted of killing three babies in his clinic, and will serve multiple life sentences.
    Credit: AP/Matt Rourke

  • A photo taken Monday captures Vice President Joe Biden's response to a Milwaukee second-grader's innovative proposal to end America's epidemic of gun violence. This guy!
    Credit: AP/Jenny Aicher

  • Sen. Rand Paul, R-Ky., flanked by a grouper-eyed Michele Bachmann, addresses the IRS' admission that it targeted Tea Party groups in advance of the 2012 election. In an op-ed for CNN Thursday, the Kentucky senator slammed the president for his faux outrage.
    Credit: AP/Molly Riley

  • Ousted IRS chief Steven Miller is sworn in on Capitol Hill Friday. Miller testified before the House Ways and Means Committee on the extra scrutiny the agency gave conservative groups applying for tax-exempt status.
    Credit: AP/J. Scott Applewhite

  • Attorney General Eric Holder pauses as he testifies on Capitol Hill before the House Judiciary Committee Wednesday. Holder is under fire, among other things, for the Justice Department's gathering of phone records at the Associated Press.
    Credit: AP/Carolyn Kaster

  • O.J. Simpson sits during an evidentiary hearing at Clark County District Court in Las Vegas, Nev., Thursday. Simpson, who is currently serving a nine-to-33-year sentence in state prison for armed robbery and kidnapping, is using a writ of habeas corpus to seek a new trial.
    Credit: AP/Las Vegas Review-Journal/Jeff Scheid

  • Major Tom to ground control: On Sunday astronaut Chris Hadfield recorded the first music video from space, a cover of David Bowie's "Space Oddity."
    Credit: AP/NASA/Chris Hadfield

  • When it rains it pours. President Barack Obama speaks during a news conference Thursday with Turkish Prime Minister Recep Tayyip Erdogan, inexplicably inspiring an #umbrellagate Twitter meme.
    Credit: AP/Jacquelyn Martin

  • A smoke plume rises high above a road block at the intersection of County A and Ross Road east of Solon Springs, Wis., Tuesday. No injuries were reported, but the the wildfire caused evacuations across northwestern Wisconsin.
    Credit: AP/The Duluth News-Tribune/Clint Austin

  • Recent Slide Shows

  • Share on Twitter
  • Share on Facebook
  • Thumbnails
  • Fullscreen
  • 1 of 11

Comments

0 Comments

Comment Preview

Your name will appear as username

You may use these HTML tags and attributes: <a href=""> <b> <em> <strong> <i> <blockquote>