Stocks closed higher for the first time this week, buoyed by minutes from the last Fed meeting that essentially set an end date for the Fed's asset purchase program. The Dow (^DJI) gained 79 points to close at 16,986, while the Nasdaq (^IXIC) rose 28 points, ending at 4,419, and the S&P 500 (^GSPC) closed 9 points higher at 1,973.
Fed minutes showed that central bank policymakers "generally agreed" to end the Fed's asset purchases with a final $15 billion reduction in October. (The Fed has been cutting back at a rate of $10 billion after every policy-making meeting.) The minutes did not mention when the Fed would start raising rates, which was also a comfort to the market.
Dow component Cisco (CSCO), which closed up 37 cents at $25.44, was among several technology stocks that rose today. Twitter ended 65 cents higher at $38.06 and Facebook finished $2.21 higher at $64.97.
American Airlines (AAL) gained more than 4% ending at $41.99, up $1.73, after the company raised its margin forecast for the second quarter and disclosed that passenger traffic rose 1% from last year. The airline also said, however, that it will book a second quarter charge of at least $580-million related to fuel-hedging contracts, bankruptcy re-organization and its December merger with US Airways.
In other market news, American Apparel (APP) has reached a preliminary agreement with Standard General to receive $25 million in financing, according to reports. The agreement will allow the retailer to pay off a $10 million loan to Lion Capital. Standard General has voting power over about 44% of American Apparel shares through an agreement with its founder and ousted CEO Dov Charney and other investors. Shares of American Apparel rose less than a penny to close at just under 85 cents.
In contrast, shares of Gigamon (GIMO), a network and communications device company, lost almost a third of their value to close at $12.29 after the company cut its second quarter revenue outlook because of “challenges with closing deals.” Shares of the Container Store Group (TCS) also fell after a weak earnings report and lower revenue outlook, ending 8% lower at $24.80, Earnings and revenues missed estimates.
Garmin (GRMN), maker of GPS devices, fell $2.77 to $57.86 after an analyst at Pacific Crest Securities downgraded the company from “sector perform” to “underperform,” saying shares are currently overvalued.
Family Dollar (FDO) reports earnings tomorrow before the open. Also out tomorrow are weekly jobless claims and chain store sales for June.
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