By Anora Mahmudova, MarketWatch
NEW YORK (MarketWatch) -- The U.S. stock shook off opening
losses on Wednesday as investors digested upbeat earnings and deal
news and a larger-than-expected fall in home construction in
January.
Zale Corp. shares (ZLC) soared on news that the jewelry
retailer's larger rival plans to buy it for $690 million. Garmin
shares (GRMN) jumped after better-than-expected earnings
results.
The S&P 500 index (SPX) was 6 points, or 0.3%, higher at
1,846.44, within a hair-breadth from its all-time high reached on
Jan 15.
The Dow Jones Industrial Average (DJI) added 90 points, or 0.6%,
to 16,219.89.
The Nasdaq Composite (RIXF) inched up less than a point to
4,273.05 rising for the ninth consecutive sessions. Follow our
stock market live blog.
Economic data: Housing starts, wholesale prices
"With the weather being this cold, it is hard to draw
conclusions from housing reports," said Terry Sandven, senior
equity strategist at U.S. Bank Wealth Management.
"Both the headline number and building permits were below
expectations, but not at worrying levels," he said.
"Fundamentals still remain strong, as earnings growth this
season so far beat expectations. We are optimistic about the
markets in 2014, however, this year we do need the economy to grow
for companies to sustain earnings and drive markets higher," he
added.
Construction on new U.S. homes tumbled 16% in January to a
seasonally adjusted annual rate of 880,000, with drops for
single-family homes and apartments, according to Commerce
Department. Economists polled by MarketWatch said particularly poor
weather hit construction last month. Building permits, a sign of
future demand, fell to the lowest rate since August.
U.S. producer prices rose in January under the government's new
formula for measuring wholesale inflation, the Labor Department
said Wednesday.
Investors will also focus on the minutes from the Federal
Reserve's policy-setting meeting in January, scheduled for 2 p.m.
Eastern. At the meeting, the Federal Open Market Committee voted to
cut back its asset-purchase program by another $10 billion.
In other central-bank news, two nonvoting members are slated to
speak. Atlanta Fed President Dennis Lockhart will talk about the
economic outlook at Mercer University in Macon, Ga., at 12:15 p.m.
Eastern, followed by St. Louis Fed President James Bullard's speech
on the U.S. economy and monetary policy in Washington, D.C. at 1
p.m. Eastern.
Movers: Zale, Chelsea Therapeutics International soar
Shares of Zale (ZLC) soared 40% after Signet Jewelers Ltd. (SIG)
said it would buy its smaller rival for about $690 million in an
all-cash deal. Signet shares rose 17%.
Chelsea Therapeutics International Ltd. (CHTPE) shares surged
31% after the U.S. Food and Drug Administration conditionally
approved the pharmaceutical company's new drug for treating
symptomatic neurogenic orthostatic hypotension. The drug, called
Northera, received an accelerated approval since it was deemed to
treat a serious unmet medical condition.
Garmin Ltd. (GRMN) climbed 7.9% after the company's earnings
beat Wall Street expectations. The provider of standalone global
positioning systems said its nonautomotive and mobile segments of
its business made up 50% of the company's total revenue.
Carlyle Group (CG) shares rallied 3.7% after the company's
fourth-quarter earnings beat expectations.
Among decliners, Potbelly Corp. (PBPB) dropped 9.6% Wednesday
after reporting fourth-quarter results. Earnings per share beat
estimates, however, revenues fell short of expectations.
La-Z-Boy Inc. (LZB) slid 4.1% after the firm reported fiscal
third-quarter results late Tuesday that failed to meet analyst
estimates.
Tesla Motors Inc. (TSLA) and Safeway (SWY) are expected to
report fourth-quarter results after the market close.
Overseas: UK unemployment rate rises
In other financial markets, the dollar rose against the pound
after the U.K. unemployment rate unexpectedly rose in the three
months to December, easing pressure on the Bank of England to raise
interest rates. Interest-rate hikes tend to be supportive for that
country's currency. The dollar index edged up after housing and
inflation data in the U.S.
European stocks traded mostly lower, while Asia markets closed
mixed. Most metals prices declined and oil prices inched
higher.
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