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Published On: Fri, Jul 26th, 2013

US Stocks make small gains, lead by Facebook

facebook

All three of the major indices in the United States closed up after Thursday’s trading session, albeit only slightly. There was plenty of action around the stocks of many household names, including Caterpillar Inc and Facebook Inc. The majority of these movements were the result of their earnings reports for the period, however, investors were also weighing a slight rise in US jobless claims over the past week.

While a slight rising claimants was expected, the rise of 9000 new claimants in just seven days did catch many analysts off guard. It was originally expected that the figure would come in and around 340,000, rising from 334,000 this time last week. However, when the data was released which suggested that there was a total of 343,000 claimants of the US unemployment benefit investors looked shaky for a brief period, while they tried to decide whether this would improve the prospects of continued stimulus from the Federal Reserve, or whether it was a signal of things to come.

Facebook enjoyed its biggest single day advance in the 14 months that it has been on the markets. The advance came on the back of its earnings report, which it released yesterday. The social network’s stock closed at $34.36 after peaking at $34.88. This represented a 29.6 percent rise in the value of Facebook, bringing it back towards its IPO price of $38 that it launched with in May of last year. This somewhat meteoric rise single-handedly dragged the NASDAQ up for the day, while the S&P 500 and Dow Jones Industrial Average hovered around their opening prices.

facebookstockrise

The S&P 500 closed at 1690.25, a rise of 4.31 points, or 0.26 percent. The DJIA closed at 15,555.61, advancing by 13.37, or 0.09 percent. Meanwhile, the technology heavy NASDAQ rose by 25.59 points, or 0.71 percent, to close at 3605.19 as a host of their constituents made advances of 10 percent or more.

nasdaqrise

Looking beyond Facebook, there were significant advances for both FriendFinder and TripAdvisor, who advanced by 25.04 percent and 16.29 percent, respectively, after their earnings reports. While these three online, user driven businesses drove the NASDAQ higher, Caterpillar Inc poured the Dow Jones Industrial Average down as it slid by 1.6 percent, or $1.30, to close at $82.14. Another noticeable decline came from General Motors, which dipped 0.2 percent to close at $37.08. This decline is hardly likely to be concerning investors after the stock approached a 24 month high earlier in the session, leaving many analysts believe that this was simply the markets way of bringing down the price of an overvalued stock as soon as possible.

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About the Author

- Gregory previously worked for a leading financial news publication and is now assistant news editor of financialtrading.com.

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