(By Balachander) U.S. stocks closed in green, reversing earlier losses, following positive remarks on the budget negotiations in Washington.
The S&P 500 Index rose 0.78 percent to end at 1,409.92. The Dow Jones Industrial Average added 0.83 percent to finish at 12,985.03. The Nasdaq Composite Index gained 0.81 percent to close at 2,991.78.
Speaker of the House John Boehner, an Ohio Republican, expressed optimism that lawmakers engaged in budget talks can reach a deal to avert the so-called fiscal cliff.
President Barack Obama said at the White House he hoped to reach an agreement on the fiscal cliff before Christmas. Obama has pushed for higher taxes on wealthy Americans to address the fiscal cliff of roughly $600 billion in spending cuts and tax increases that could hit economic growth.
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On the data front, a report showed that new-home sales - which measures the annualized number of new single-family homes that were sold during the previous month - unexpectedly fell 0.3 percent to 368,000 from 369,000 in September. Economists expected new-home sales to increased to 390,000.
Beige Book, a report on current economic conditions in each of the 12 Federal districts in the U.S., showed that economic activity expanded at a measured pace in recent weeks. Consumer spending grew at a moderate pace, while manufacturing weakened.
Hot Stocks Of The Day: GMCR, COST, KCG, EXPR, ANN, AEO, PVH, TFM, JOSB
In corporate news, Green Mountain Coffee Roasters Inc. (NASDAQ: GMCR) spiked 27.32 percent after the company announced a 22 percent jump in quarterly earnings on strong sales. GMCR's results and first-quarter outlook came in above market expectations.
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Costco Wholesale Corp. (NASDAQ: COST) gained 6.29 percent after the company reported a 6 percent growth in comparable store sales for November and it declared a special dividend of $7 per share.
Knight Capital Group Inc. (NYSE: KCG) jumped 15.15 percent after trading firm Getco Holding Co proposed to acquire the financial services provider for $3.50 a share.
Express Inc. (NYSE: EXPR) surged 8.93 percent after the apparel retailer posted better-than-expected quarterly earnings and its guidance topped consensus.
Ann Inc. (NYSE: ANN) gained 8.23 percent after the retailer of women apparel posted third-quarter results that beat market expectations on improved margins and it raised its forecast for 2012.
American Eagle Outfitters (NYSE: AEO) rose 7.12 percent after the specialty retailer raised its profit view for the full year. The company's third-quarter earnings increased on a 11 percent growth in sales.
Fresh Market Inc. (NASDAQ: TFM) tumbled 12.38 percent after the company's quarterly earnings trailed Wall Street projections. Deutsche Bank downgraded its rating on the stock to "Hold" from "Buy".
PVH Corp. (NYSE: PVH) advanced 6.56 percent after the sportswear and footwear maker boosted its guidance for the full year following third-quarter results.
Jos. A. Bank Clothiers Inc. (NASDAQ: JOSB) retreated 7.25 percent after the Hampstead, Maryland-based apparel retailer posted an unexpected drop in third-quarter profit, citing Hurricane Sandy and decline in operating margin due to additional markdowns and promotional activity. The company said it remains "cautious' for the outcome of the fourth quarter.
European markets ended modestly higher, with Germany's DAX up 0.15 percent to close at 7,343.41. France's CAC40 added 0.37 percent to finish at 3,515.19. The U.K.'s FTSE 100 gained 0.06 percent to end at 5,803.28.
Among Asian markets, China's Shanghai Stock Exchange Composite Index declined 0.89 percent to finish at 1,973.52. Japan's Nikkei 225 shed 1.22 percent to finish at 9,308.35. Hong Kong's Hang Seng Index fell 0.62 percent to end at 21,708.98. India's BSE Sensex was shut for a holiday.
Commodity & Currency Scan
Crude oil futures fell 0.57 percent to $86.68 per barrel, and natural gas futures dropped 1.94 percent to $3.70 per million metric British thermal units. Gold futures declined 1.38 percent to $1,720.8 per ounce and silver futures slid 0.98 percent to $33.74 per ounce.
In the currency market, the euro was unchanged against the U.S. dollar to 1.2943. The British pound edged 0.02 percent lower against the greenback to 1.6019, while the dollar slipped 0.24 percent against the Japanese yen at 81.9600.