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Overnight Markets: Wall Street rebounds as healthcare stocks rally

by Himanshu Singh on Jan 08, 2014 at 03:44

Overnight Markets: Wall Street rebounds as healthcare stocks rally

Wall Street bounced back on Tuesday, snapping a three-day losing streak, led by hospital and health-insurance shares ahead of Friday’s employment report and the beginning of fourth-quarter earnings season this week.

The Dow Jones industrial average added 106 points or 0.64%, to end at 16,531. The S&P 500 gained 11 points or 0.61%, to finish at 1,838. The Nasdaq Composite added 40 points or 0.96%, to close at 4,153.

A sharp decline in the US trade deficit and strong German data helped improve market sentiment as the figures signaled strengthening economic fundamentals in both the US and Europe.

US exports hit a record high in November, while weak oil prices restrained import growth, resulting in the smallest US trade deficit in four years. German unemployment unexpectedly declined in December on a seasonally-adjusted basis.

Healthcare shares gained the most after a Deutsche Bank upgrade of UnitedHealth Group Inc (UNH.N) to a "buy". Shares of UnitedHealth, a Dow component, rose 3.1%. Tenet Healthcare (THC.N) shares climbed 4.9%. Pharmacyclics Inc. jumped 20% after its leukemia medicine met a trial’s goals.

Community Health Systems Inc (CYH.N) shares gained 3.8% a day after the company said the new US healthcare law should give a slight boost to its 2014 earnings.

Shares of Google Inc (GOOG.O) hit a record intraday high of $1,139.69 before closing up 1.9% at $1,138.86. JP Morgan, which has an "overweight" rating on Google, raised its target price on the stock to $1,305 from $1,100.

In the financial sector, JP Morgan Chase & Co (JPM.N) shares declined 1.2% after the lender said it would pay more than $2 billion of penalties to settle charges by US federal authorities that it failed to report suspicious activity involving Bernard Madoff's Ponzi scheme.

GameStop Corp (GME.N) shares plunged 8.4% after Sony Corp said it will begin testing a new PlayStation-based streaming service that could cut into the video game retailer's used game sales. US-listed shares of Sony (SNE.N) edged up 0.1%.

In Asia, stocks gained on Wednesday in morning trade after the International Monetary Fund said it will raise its global economic growth forecast and the US trade deficit narrowed.

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