Markets Up On News Out Of Europe

4:17 PM, Oct 18, 2011 --

• DJIA up 180 (+1.5%) to 11,577
• S&P 500 up 24 (+2%) to 1,225
• Nasdaq up 42 (+1.6%) to 2,657

GLOBAL SENTIMENT

• Nikkei down 1.6%
• Hang Seng down 4.2%.
• Shanghai Composite down 2.3%.
• FTSE-100 down 1.1%.
• DAX-30 down 0.2%.

UPSIDE MOVERS

(+) BAC improves from initial loss; earnings largely beat.

(+) GS falls then gains after earnings.

(+) EMC beats with earnings, meets on revenue.

(+) VMW downgraded this morning after earnings, revenue beat.

(+) DPZ reports improved Q3 vs year ago.

(+) HGSI report says GSK to offer $25 per share.

DOWNSIDE MOVERS

(-) WHR downgraded.

(-) X downgraded.

(-) HAS downgraded.

(-) AGL cuts outlook.

(-) AONE downgraded.

(-) CWTR continues evening slide that followed mixed guidance, including Q3 miss.

(-) CROX continues evening slide that followed earnings warning.

(-) COH initiated with Hold rating.

(-) UNH beats with Q3, raises outlook.

(-) SQNM downgraded.

(-) WAG downgraded.

(-) HOG EPS beat, sales miss.

MARKET DIRECTION

Stocks end with strong gains, getting a late-day boost to established gains. The U.K.'s Guardian newspaper reported that France and Germany have reached agreement to bolster the euro-area's rescue fund. Stocks kicked the trading day off with a mixed start. Economic data from China, which indicated slowing in that economy, also weighed on investor sentiment. But financials improved afer a slow reaction to earnings and took the broader market along on the upside.

From Asia, China's gross domestic product rose 9.1% in the third quarter from a year earlier, marking a slowdown from the second quarter's 9.5% gain and below expectations for 9.2% growth.

On the U.S. data front, the U.S. producer price index rose a seasonally adjusted 0.8% in September, the biggest increase since April. That's stronger than the 0.4% gain predicted. Higher wholesale prices were driven by a 2.3% increase in energy costs and a 0.6% rise in food costs.

So-called "core" wholesale prices rose a lesser 0.2% but still stronger than the 0.1% that Wall Street expected. Over the past 12 months, wholesale prices have climbed an unadjusted 6.9%. Omitting food and energy, wholesale prices have risen a more modest 2.5% in the past year.

Also reported: the strongest measure of homebuilder sentiment in October since May 2010.

In company news:

Par Pharmaceutical (PRX) announced Tuesday that it acquired rights to three products from Teva Pharmaceuticals (TEVA) in connection with TEVA's acquisition of Cephalon. Par shares are fractionally higher.

Goldman Sachs downgraded Whirlpool (WHR) to "sell" from "neutral." The firm cited the company's slowing U.S. growth, as well as increased capacity in Brazil by LG and Samsung, which will pressure WHR's market share and margins. The firm lowered the price target is lowered to $42 from $55.

Jazz Pharmaceuticals (JAZZ) is down after the U.S. Food and Drug Administration sent the company a letter stated that it had identified significant violations of Section 505(k) of the Federal Food, Drug, and Cosmetic Act and Title 21, Code of Federal Regulations in the company's activities.

In other earnings news:

--Goldman Sachs (GS) reported a Q3 loss of $0.84 compared to EPS of $2.98 in the same period a year earlier and the Thomson Reuters mean analyst estimate for a loss of $0.14. Revenues were $3.59 billion. The Street expected $4.3 billion.

--Johnson & Johnson (JNJ) reported Q3 net income of $3.2 billion, or $1.15 per share, compared with $3.42 billion, or $1.23 per share, last year. Ex-items, net income was $3.4 billion, or $1.24 per share. Analysts were looking for a consensus $1.21 per share. Revenue was $16 billion, up 7% from a year ago, matching the Street's consensus call for $16.02 billion.

--Domino's Pizza (DPZ) says Q3 adjusted EPS rose to $0.35 from $0.27 a year ago. Sales rose to $376.326 million from a year ago.

--Coca-Cola (KO) says Q3 sales were $12.248 billion, above the Thomson Reuters mean for $12.0143 billion. EPS were $0.95, including items. Estimates, usually less items, were for $1.02 on average.

--IBM (IBM) said late Monday that Q3 non-GAAP EPS came in at $3.28 on sales of $26.2 billion. The Street view was for EPS of $3.22 on sales of $26.26 billion.