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Market Recap: Euro Bank Chief Sends Stocks Soaring


Markets closed mixed today:

▲ Dow: +1.67 percent

▲ Nasdaq: +1.37 percent

▲ S&P: +1.65 percent

Precious metals:

▲ Gold: up +0.71 percent to $1,615.00 an ounce

▲ Silver: up +0.68 percent to settle at $27.43


▲ Oil: +0.60 percent

Markets closed up today because:

It was the buy signal that markets were waiting for.

When European Central Bank president Mario Draghi vowed to "do whatever it takes" to keep the continent's monetary union intact, stocks were off to races in the U.S. and Europe.

The Dow Jones industrial average on Thursday jumped 212 points, or 1.7 percent, to 12,888 following big gains in European markets. Benchmark stock indexes in Spain and Italy surged 6 percent and 4 percent in France.

Draghi's comments at an investor conference at the Olympics raised hopes that Europe's central bank might intervene to bring down the cripplingly high borrowing costs for struggling European countries like Spain and Italy.

After insisting for months that it was up to European governments to restore confidence in the currency shared by 17 nations there, Draghi pledged that "the ECB is ready to do whatever it takes to preserve the euro."

In other signs that investors were becoming more confident that Europe's financial crisis would not spin out of control, borrowing costs for Spain and Italy fell sharply, the euro surged a penny to $1.23 against the dollar and the yield on the 10-year Treasury note rose to 1.43 percent from 1.40 percent late Wednesday. Investors tend to sell low-risk assets like Treasurys when they're less fearful about global markets and the economy.

The broader the Standard & Poor's 500 index rose for the first time in five days. It was up 22.13 points, or 1.7 percent, to 1,360.02 The gains in the U.S. stock market were broad. All 10 of the industry groups in the S&P 500 index rose, led by telecommunications companies.

Technology companies continued to report disappointing earnings following industry leader Apple's rare earnings disappointment earlier this week.

Zynga, which produces popular social network games "CityVille" and "FarmVille" posted poor quarterly results and cut its outlook, prompting a number of analyst downgrades. Its stock fell $1.90, or 37.5 percent, to $3.17.

Zynga's disastrous results were also a bad omen for Facebook, which got about 12 percent of its 2011 revenue from Zynga. Facebook plunged 10 percent in after-hours trading after the company reported a loss of $157 million for its second quarter. The stock was down $2.63 at $24.19.

The Associated Press contributed to this report.

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