Tuesday, December 11, 2012

Stocks edge higher; Dow is boosted by McDonald's

NEW YORK (AP) -- Stocks inched higher Monday on Wall Street after a strong sales report from McDonald's helped offset concerns about the surprise resignation of Italy's prime minister. Investors also waited for developments in crucial U.S. budget talks.

The Dow Jones industrial average was up 29 points at 13,184 just after 1 p.m. EST. The Standard and Poor's 500 was up one point at 1,419. The Nasdaq composite was up six points at 2,984.

McDonald's rose $1.18 to $89.66. A key sales figure rose in November as U.S. customers bought more breakfast offerings and limited-time Cheddar Bacon Onion sandwiches.

Robert Pavlik, chief market strategist at Palm Beach, Fla.-based Banyan Partners, said the company's strength was encouraging. McDonald's, one of the 30 stocks in the Dow, was trading as high as $100 at the beginning of 2012.

The pickup in McDonald's sales, he said, gave investors something positive to focus on as Italy's sudden political turmoil sent a jolt through European markets.

Hewlett-Packard rose 30 cents to $14.23 and pushed the Dow higher. The has been battered in the past two months following a weak earnings outlook and a public spat with the founder of Autonomy, a company it acquired for $10 billion last year.

Italian Prime Minister Mario Monti, who has been credited with restoring confidence in the nation's economy, announced that he would step down after former Prime Minister Silvio Berlusconi's party dropped its support for his government.

Italian government bond yields, a critical measure of how much the country has to pay to borrow, jumped. Concern that the European debt crisis was enveloping Italy, one of the euro region's largest economies, helped stymie markets around the world earlier in the year.

Investors were also following developments in budget talks in Washington. Tax increases and federal spending cuts start Jan. 1 unless a deal is reached to reduce the U.S. budget deficit. Economists say the measures, if implemented, could eventually push the economy back into recession.

The yield on the 10-year Treasury note was little changed at 1.63 percent.

President Barack Obama and House Speaker John Boehner met at the White House on Sunday while rank-and-file Republicans stepped forward with what they called pragmatic ideas to break the stalemate. The Obama-Boehner meeting was the first between just the two leaders since Election Day.

"There's a pretty good belief that the 'fiscal cliff' can be avoided," said Craig Johnson, a technical market strategist at Piper Jaffray. "Anytime somebody is talking, it's a good thing."

Other stocks making big moves:

? Priceline.oom fell $33.90 to $625.10 after Deutsche Bank cut its recommendation on the stock to "hold" from "buy" and lowered its price target to $710 from $800.

? Phillips 66, the refining and pipeline company, gained $1.92 to $54.26 after saying late Friday that it was raising its quarterly dividend to 31.25 cents per share from 25 cents. The company also said it had approved the repurchase of another $1 billion in company stock, after approving the repurchase of $1 billion of shares during the first quarter.

? Intermec, a maker of barcode printers and radio frequency identification products, jumped $1.83 to $9.81 after it agreed to be acquired by Honeywell for about $603.4 million in cash.

? AIG fell 58 cents to $33.55 after it said late Friday that it will take $1.3 billion in losses related to Superstorm Sandy, more than other major insurance companies have reported so far.

Source: http://news.yahoo.com/stocks-edge-higher-dow-boosted-163305240.html

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