U.S. stocks advance after largest selloff for S&P 500 since 2011

‘Inappropriately Timed’

Fed Bank of St. Louis President James Bullard today said the central bank had “inappropriately timed” its decision to lay out a plan to reduce the pace of bond purchases.

“A more prudent approach would be to wait for tangible signs that the economy was strengthening and that inflation was on a path to return toward target before making such an announcement,” Bullard said in a statement today.

The Chicago Board Options Exchange Volatility Index, the measure of options on the S&P 500 known as the VIX, sank 7.9% to 18.88. The gauge surged 23% to 20.49 yesterday, the highest level since Dec. 28.

Nine out of 10 groups in the S&P 500 rallied. Consumer- staple, health-care and utility shares rose more than 1.1%. Merck & Co. added 2.3% to $47.37 for the biggest gain in the Dow. Coca-Cola Co. jumped 1.4% to $39.68.

CarMax jumped 3.5%, the most in the S&P 500, to $46.11. The largest U.S. seller of used cars posted first- quarter adjusted earnings of 64 cents a share, exceeding the average analyst estimate of 58 cents. Sales in the period also exceeded projections.

Facebook Climbs

Facebook climbed 2.9% to $24.58. By adding video to its Instagram service for smartphones, Facebook is stepping up competition with microblogging site Twitter Inc. The new feature lets users capture, upload and share clips as long as 15 seconds, Kevin Systrom, Instagram’s co-founder, said at an event at Facebook’s headquarters in Menlo Park, California.

Oracle lost 8.9% to $30.24. The world’s largest maker of database software reported fourth-quarter profit excluding some items of 87 cents a share on sales of $11 billion, missing analysts’ average estimate for profit of 87 cents on revenue of $11.1 billion, according to data compiled by Bloomberg.

The shares fell even as Oracle doubled its quarterly dividend, added $12 billion in buybacks and applied to list on the New York Stock Exchange.

Darden Restaurants Inc. sank 2.4% to $50.02. The operator of restaurant chains such as Olive Garden and Red Lobster said earnings in 2014 will be as much as 5% below 2013 profit.


<< Page 2 of 2

Copyright 2014 Bloomberg. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

comments powered by Disqus
Check out Futures Magazine - Polls on LockerDome on LockerDome