(By Balachander) U.S. stocks rallied amid growing hopes of monetary intervention by the Federal Reserve and the European Central Bank to stimulate the global economy.
S&P 500 Index jumped 1.91 percent to close at 1,385.98. The Dow Jones Industrial Average gained 1.46 percent to end at 13,075.88. The Nasdaq Composite Index added 2.24 percent to finish at 2,958.09.
A report from the U.S. Commerce Department confirmed that the world's largest economy expanded at a slower pace. U.S. gross domestic product grew at a 1.5 percent annual pace in the second quarter, slowing from a revised 2.0 percent growth in the first quarter, raising hopes for an additional round of stimulus from the Fed.
Equity markets also got a boost from reports that European Central Bank President Mario Draghi will hold discussions with Bundesbank President Jens Weidmann on new measures to tackle the euro zone's debt woes. Draghi had said the central bank could do whatever is needed to protect the beleaguered euro.
The Thomson Reuters/University of Michigan's final index of consumer sentiment for July came in slightly above expectations of a reading of 72.
Hot Stocks Of The Day: AMZN, FB, MRK,SBUX, ACI, EXPE, GILD, AMGN, AUTH
In corporate news, Amazon.com Inc. (NASDAQ:AMZN) jumped 7.87 percent after the online retail giant posted a jump in quarterly sales though earnings declined as expenses increased.
Facebook Inc. (NASDAQ:FB) tumbled 11.70 percent after the social networking giant posted a quarter loss, its first results as a public company, amid concerns of slowing growth.
Merck & Co. Inc. (NYSE:MRK) rose 4.04 percent after the Whitehouse Station, New Jersey-based health care giant posted quarterly earnings that topped market expectations, spurred by double-digits sales growth of some of its top drugs and improvement in margins.
Starbucks Corp. (NASDAQ:SBUX) plunged 9.42 percent after the Seattle-based coffee retailer reported lower-than-expected quarterly earnings due to high commodity costs and economic headwinds. Further, the company reduced its fourth-quarter earnings forecast.
Arch Coal Inc. (NYSE:ACI) rallied 29.28 percent after the St. Louis, Missouri-based coal producer reported results for the second quarter that came in better than expected. The company slipped to a quarterly loss, hurt by mine closure costs and impairment charges. Revenue rose 8 percent, topping consensus estimate of a 1.30 percent gain.
Expedia Inc. (NASDAQ:EXPE) surged 20.11 percent after the Bellevue, Washington-based online travel company raised its 2012 forecast following upbeat second quarter results.
Gilead Sciences Inc. (NASDAQ:GILD) advanced 7.39 percent to $55.50 after the Foster City, California-based developer of AIDS drugs posted quarterly results that surpassed Wall Street projections. The company said it plans to start a late-stage study combining two drugs canditates into a single pill to treat hepatitis C.
Amgen Inc. (NASDAQ:AMGN) advanced 5.83 percent after the Thousand Oaks, California-based drug maker boosted its 2012 earnings and revenue guidance following strong second-quarter results.
AuthenTec Inc. (NASDAQ:AUTH) soared 66.07 percent after the Florida-based provider of mobile and network security services said it agreed to be acquired by technology behemoth Apple Inc. (NASDAQ:AAPL) for $8 per share. The deal represents a 58 percent premium to AUTH's previous closing price.
European markets closed sharply higher, with Germany's DAX gaining 1.62 percent to close at 6,689.40. France's CAC40 jumped 2.28 percent to finish at 3,280.19. U.K.'s FTSE 100 added 0.97 percent to end at 5,627.21.
Among Asian markets, China's Shanghai Stock Exchange Composite Index inched up 0.13 percent to finish at 2,128.76. Japan's Nikkei 225 gained 1.46 percent to end at 8,566.64. Hong Kong's Hang Seng Index rallied 2.02 percent to end at 19,274.96. India's BSE Sensex finished at 16,839.19, up 1.20 percent.
Commodity & Currency Scan:
Crude oil futures rose 0.83 percent to $90.13 per barrel while natural gas futures dropped 3.06 percent to $3.010 per million metric British thermal units. Gold futures advanced 0.53 percent to $1,628.4 per ounce and silver futures added 1.03 percent to $27.73 per ounce.
In the currency market, the euro inched 0.20 percent higher against the U.S. dollar to 1.2308. The British pound rose 0.28 percent against the greenback to 1.5730, and the dollar added 0.33 percent against the Japanese yen to 78.4800.