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Overnight Markets: Health care shares boost Wall Street
by Himanshu Singh on Feb 25, 2014 at 03:10
Wall Street advanced on Monday, with the S&P 500 hitting a record intraday high, after health care shares jumped on a smaller-than-forecast cut in Medicare rates and amid optimism about merger activity.
The Dow Jones industrial average rose 104 points or 0.64%, to close at 16,207. The S&P 500 gained 11 points or 0.62%, to end at 1,848, after rising to an intraday record of 1,859. The Nasdaq Composite added 30 points or 0.69%, to finish at 4,293.
Health care shares jumped after the government's proposed cuts to the private Medicare programme appeared to be less than it had forecast. Humana Inc (HUM.N) surged 10.6%, while UnitedHealth Group (UNH.N) shares rose 3%. Aetna Inc (AET.N) gained 2% after giving a 2014 earnings outlook.
The latest economic data showed the Chicago Fed National Activity index fell to -0.39 in January from 0.16 in December while financial data firm Markit's preliminary February reading on the services sector fell to 52.7 from 56.7.
In deal news, chipmaker RF Micro Devices Inc (RFMD.O) agreed to buy TriQuint Semiconductor Inc (TQNT.O) for about $1.6 billion. Men's Wearhouse Inc (MW.N) raised its cash tender offer for rival men's clothing retailer Jos. A. Bank Clothiers Inc (JOSB.O) to $63.50 per share from $57.50.
Shares of RF Micro shot up 21%, while TriQuint's stock surged 26.1%. Men's Wearhouse shares jumped 7.5%, while Jos. A. Bank's stock soared 9.1%.
Shares of eBay (EBAY.O) advanced 3.1%, helping lift the Nasdaq, after billionaire investor Carl Icahn called again for the spinoff of eBay's fast-growing PayPal payments business.
On the downside, Tenet Healthcare (THC.N) fell 3.8% after the bell following the release of its results.
In Asia, stocks rose on Tuesday in morning trade as telecommunication and health-care companies led gains.
The MSCI Asia Pacific Index climbed 0.8% to 138 as of 9:30 a.m. in Hong Kong. Japan’s Topix index today gained 1.1% and South Korea’s Kospi index rose 0.8%.
Australia’s S&P/ASX 200 advanced 0.1%, as did New Zealand’s NZX 50 Index. Hong Kong’s Hang Seng Index added 0.5% and China’s Shanghai Composite was little changed. Singapore’s Straits Times Index rose 0.2% and Taiwan’s Taiex Index advanced 0.4%.
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