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Stocks close-in on old highs

Tuesday, July 09, 2013 - 02:06

July 9 - U.S. stocks are heading back towards record highs set in May thanks to a four-day upswing; housing stocks rally as foreclosures decline; FedEx gains on investment speculation; Kroger, Harris Tweeter tie up in $2.5 billion deal; Goldman downgrades IBM. Conway G. Gittens reports.

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Record watchers are back on the job as stocks enjoy their first four-day rally since May. An 11 point gain for the S&P 500 brings the benchmark index within 17 points of setting a record close. And the Dow is a little more than 100 points shy of a closing high. Investors are hoping earnings season predictions will prove to be too cautious. Alcoa helped with that with better-than-expected profits announced the day before. Shares of Alcoa, however, finished slightly to the downside. Housing, however, held on to its strength. Data from CoreLogic showed home foreclosures in May were 20,000 fewer than the same time the year before. Homebuilder D.R. Horton was one of the most active stocks on the NYSE - gaining 7-1/2 percent. Is FedEx scheduled for a special delivery from a big investor? Wall Street seems to thinks so. There's speculation billionaire investor William Ackman may be looking to plow $1 billion into the company. A spokesperson was not available for comment. Nevertheless, the speculation was enough to drive shares of FedEx up by more than 4 percent. Merger in aisle 6. Kroger, the largest U.S. supermarket chain, buying Harris Teeter, a regional player, for $2.5 billion. Grocers like Kroger are trying to bulk up to compete against the likes of Costco, Wal-mart, Target and Whole Foods. Shares of the acquirer and the acquiree- both jumping to all-time highs. IBM was downgraded to neutral at Goldman Sachs. The analyst thinks IBM will face short-term headwinds due to weaker spending for technology services and slower growth from emerging markets like Brazil, Russia, India and China. Shares of IBM down close to 2 percent. By the way, earnings are released July 17th. On the international front, the International Monetary Fund downgraded global forecasts for this year and next. The IMF citing slower growth in emerging markets and more weakness in Europe. Stocks in Europe, though, end the day higher for the second day in a row.

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Stocks close-in on old highs

Tuesday, July 09, 2013 - 02:06