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Stocks continue higher on positive news flow

David Russell (david.russell@optionmonster.com)

Stocks are higher today, fueled by positive company news and reduced geopolitical risk.

S&P 500 futures rose about 0.2 percent, while the Nasdaq is indicated up 0.3 percent. Most European indexes climbed about 0.8 percent. Asia posted similar gains overnight, led by Shanghai's 1.2 percent advance.

Stocks have been rebounding from a drop in late July and early this month that brought the S&P 500 back to its 100-day moving average for the sixth time since the current bull run began in January 2013. Worries about Russian involvement in Ukraine and Europe's economic slowdown have weighed on sentiment during that time, but investors used the weakness to amass airlines, biotechs and solar-energy stocks.

There are also several positive headlines today: Coca-Cola agreed to buy a 17 percent stake in Monster Beverage, driving MNST up by 22 percent in early trading. Gannett is also up 3 percent after Carl Icahn also bought a stake in the media company. 

Software maker Autodesk raised full-year guidance and is up 4 percent. Applied Materials rose 3 percent after earnings beat and its forecast exceeded consensus. J.C. Penney rose almost 1 percent after earnings beat estimates. On the geopolitical front, a Russian convoy submitted to Ukrainian inspections, calming tensions in that region.
Attention now turns to the New York Federal Reserve's Empire manufacturing index at 8:30 a.m. ET and the University of Michigan's consumer-sentiment gauge at 9:55 a.m. Next week's calendar brings housing data, more retail earnings and preliminary readings of industrial activity in China and Europe.

Our researchLAB market scanner has also shown strength in the last week among ocean-shipping stocks, oil tankers, mobile semiconductor makers, fuel cells, railroad suppliers and videogame makers. Energy, television broadcasters and Latin American stocks have struggled.

Commodities are mixed, with oil and copper fractionally higher and  precious metals down slightly. The euro is also rebounding from recent lows and the safe-haven Japanese yen is down against most other currencies.

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