U.S. stocks rose, with the Standard & Poor’s 500 Index rebounding from an eight-week low, as energy shares rallied and investors watched developments on Syria.
Chevron Corp. and Exxon Mobil Corp. jumped more than 2.3 percent. TiVo (TIVO:US) Inc. climbed 5.6 percent after the maker of digital-video recorders posted a profit. Joy Global Inc. lost 4.7 percent as the mining equipment maker said orders for new equipment are declining. PulteGroup Inc. and D.R. Horton Inc. declined at least 1.2 percent as pending sales of existing homes unexpectedly fell in July.
The S&P 500 rose 0.3 percent to 1,634.96 at 4 p.m. in New York. The index closed just short of its average level for the past 100 days of 1,638.27, after slipping below it yesterday for the first time since June. The Dow Jones Industrial Average advanced 48.38 points, or 0.3 percent, to 14,824.51.
“We’re simply just seeing a little bit of bounce back from what was very bad action yesterday,” Walter Todd, who oversees about $950 million as chief investment officer of Greenwood Capital Associates LLC in Greenwood, South Carolina, said by phone. “There are probably starting to be opportunities that are being created in certain segments of the market as a result of this sell-off, and investors are wisely looking to see if they can take advantage of some of those.”
The S&P 500 slid 1.6 percent yesterday to the lowest level since July 3 amid concern the U.S. will take action against Syria. The U.S. and the U.K. today said they are prepared to take military action against Syria without authorization from the United Nations Security Council.
After Russia objected to a UN resolution offered by the U.K. authorizing action to protect civilians, a State Department spokeswoman said the U.S. will take “appropriate” steps without the international body’s approval. The U.S. and its NATO allies began presenting their justification for military action as they advanced plans for launching strikes and prepared evidence that the Syrian government used chemical weapons on its own people.
“This is an environment where people are really focused on one variable which is going to dominate all others, and that, today, is Syria,” Lawrence Creatura, a Rochester, New York-based fund manager at Federated Investors Inc., which oversees about $380 billion, said in a phone interview. “The reflex is to sell during times of sudden unexpected conflict. Weakness derived from temporary events can often times be a great buying opportunity.”
The S&P 500 has lost 4.4 percent from a record high on Aug. 2 amid growing speculation the Federal Reserve will reduce its monthly bond buying. Minutes of the central bank’s July meeting released Aug. 21 showed policy makers supported stimulus cuts this year if the economy improves. Fed stimulus helped push the S&P 500 up as much as 153 percent from its March 2009 low, as better-than-estimated corporate earnings also fueled gains.
Data today showed fewer Americans signed contracts in July to buy previously owned homes. The index of pending home sales dropped 1.3 percent, the most this year, after a 0.4 percent decrease in June, according to figures from the National Association of Realtors. Economists forecast no change in the gauge from the month before, according to a median estimate in a Bloomberg survey.
About 5.2 billion shares changed hands on U.S. exchanges. Trading volume is heading for the second-slowest month in at least five years, according to data compiled by Bloomberg. An average of about 5.5 billion shares changed hands each day this month. That’s about 80 million shares more than last August.
The Chicago Board Options Exchange Volatility Index (VIX), or VIX, fell 1.7 percent to 16.49. The equity volatility gauge has surged 39 percent since a five-month low on Aug. 5.
Seven out of 10 main industry groups in the S&P 500 rose, with energy companies jumping 1.8 percent to pace advances. Chevron advanced 2.5 percent to $121.81. Exxon Mobil rallied 2.3 percent to $88.84. Marathon Oil Corp. increased 3.7 percent to $34.60. Oil futures climbed 1 percent to the highest in two years.
TiVo advanced 5.6 percent to $11.58 after reporting second-quarter net income of $268.9 million, including legal settlements, compared with a $27 million loss a year earlier. Chief Executive Officer Tom Rogers said in an interview the company will be profitable for the remainder of the fiscal year ending January and through the following year.
Avago Technologies Ltd. surged 4.7 percent to $38.28. The supplier of components for wireless communications reported third-quarter revenue of $664 million, exceeding the $617.25 million average forecast of analysts surveyed by Bloomberg.
Zale Corp. rose 30 percent to $11.63, the highest level since 2008. The jewelery retailer reported fourth-quarter revenue that beat analyst estimates as same-store sales jumped 5.6 percent.
Express Inc. (EXPR:US) gained 6.6 percent to $21.10. The specialty retailer said same-store sales rose 6 percent in the second quarter, beating analysts’ estimates, and raised its profit forecast.
Tiffany & Co. retreated 4.4 percent to $77.25, extending its loss for the week so far to 5.8 percent. The world’s second-largest luxury jewelry retailer yesterday reported second-quarter sales that were short of analyst estimates.
Joy Global lost 4.7 percent to $48.89. The mining equipment producer’s CEO, Mike Sutherlin, said the market “has become even more challenging,” as customers’ declining cash flows are resulting in “significantly” reduced capital expenditures. Caterpillar Inc. slid 0.3 percent to $82.45.
An S&P index of homebuilders fell 1.2 percent. PulteGroup lost 1.4 percent to $15.38 while D.R. Horton declined 1.2 percent to $17.77.
Taser International Inc. (TASR:US) fell 5.9 percent to $11.15, after rising 38 percent in the past 11 trading days. The maker of stun guns declined after JPMorgan analysts downgraded the shares to neutral from overweight.
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