After Market: Stocks Bounce Back Strong with a Temporary 'Peace Dividend'

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As one tweeter wrote Tuesday: "Not even World War III can stop this rally!!!" Russia walked back from the brink, and stocks made a similar about face. After the Russian troops massed along the Ukraine border were ordered back to their barracks by President Putin -- bringing the level of tension in the region way down -- the market regained all of Monday's big losses, and then some.

The Dow Jones industrial average (^DJI) jumped 227 points, its best gain this year. The Standard & Poor's 500 index (^GPSC) rallied 28 -- back into record territory -- and the Nasdaq composite (^IXIC) soared 74 points. It was a broad-based rally with gainers swamping losers by a 9-to-1 margin.

Leading the blue chips: American Express (AXP) rose 3 percent, while Walt Disney (DIS), Goldman Sachs (GS), Pfizer (PFE) and General Electric (GE) all gained 2 percent or more. Airline stocks regained some altitude. Delta (DAL) rose 5½ percent on stronger passenger traffic number. United (UAL) and Southwest (LUV) both gained nearly 3 percent.

Some of the biggest losers on Monday were the Russian stocks that also trade on U.S. exchanges. Not surprisingly, they were big gainers today: Yandex (YNDX), up 6 percent; Qiwi (QIWI) and Lukoil (LUKOY), both up 4 percent.

In the retail sector, J.C. Penney (JCP) rose nearly 4 percent after S&P raised the company's credit rating. And Abercrombie & Fitch (ANF) gained 6½ percent following a Credit Suisse upgrade to "outperform." Despite today's gain, Abercrombie shares are still down 10 percent from a year ago.

But Radio Shack (RSH) was the day's big loser. It tumbled 18 percent as its loss widened and the company said it will close up to 1,100 under-performing stores. Shares of Radio Shack (RSH) are now down 25 percent over the past year.

Ascena Retail (ASNA), which operates the Lane Bryant and Justice chains, fell 3 percent on a weak earnings forecast. Also on the downside: McDermott (MDR) lost 8 percent. The energy services company missed expectations and said it was withdrawing its earnings guidance for the foreseeable future.

But the game maker Zynga (ZNGA) gained 8 percent. It's expanding its real money poker business, and offering new mobile versions of "Words With Friends" and "FarmVille."

What to Watch Wednesday:
  • Moody's Analytics/Automatic Data Processing release February's survey of private-sector hiring at 8:15 a.m. Eastern time.
  • The Institute for Supply Management releases its service sector index for February at 10 a.m.
  • The Federal Reserve releases its Beige Book survey of regional economic conditions at 2 p.m.
These major companies are scheduled to release quarterly financial statements:
  • Coca-Cola Bottling (COKE)
  • FTD (FTD)
  • Hovnanian Enterprises (HOV)
  • Navistar International (NAV)
  • PetSmart (PETM)
  • Revlon (REV)
-Produced by Drew Trachtenberg.


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