Why Alcoa, Illumina, and Whirlpool Soared Today

Although we don't believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes -- just in case they're material to our investing thesis.

The stock market climbed for all the wrong reasons Tuesday, as the Dow Jones Industrial Average (DJINDICES: ^DJI  ) gained 75 points after a disappointing jobs report once again stoked hopes for further Federal Reserve stimulus measures. But Alcoa (NYSE: AA  ) , Illumina (NASDAQ: ILMN  ) , and Whirlpool (NYSE: WHR  ) didn't need any extra help today, as all three stocks posted sizable gains. Let's take a closer look at what sent those three stocks higher.

Alcoa jumped 9% after announcing this morning that it would create a joint venture with Russian titanium-production company VSMPO-AVISMA aimed at meeting the increased demand for aircraft-quality aluminum and titanium. The two metals are both known for their strength and lightness, which is especially important in maximizing efficiency in aircraft designs. With aerospace giants projecting trillions of dollars in aircraft sales over the next 20 years, Alcoa stands to benefit greatly from aerospace-specific aluminum demand, especially to the extent that it can make value-added products that go beyond simply providing raw materials for other component manufacturers.

Illumina closed up more than 10% in the aftermath of a strong earnings report and positive guidance for the remainder of the year. Illumina has made huge inroads in the genetic analysis arena, and it has great potential to help companies create health-care solutions based on specific genetic indications that can boost efficacy and possibly decrease negative side effects. As DNA sequencing and other genetic testing become more commonplace, Illumina should continue to have room to grow.

Whirlpool did the best of all three of these stocks, gaining almost 12% after its third-quarter earnings more than doubled from year-ago levels. The appliance maker also raised its guidance for the year. Even though Whirlpool fell short of expectations on the revenue side, measures to reduce expenses paid off on the bottom line. If weakness in Latin America and Asia reverses itself in future quarters, Whirlpool could have further to climb.

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  • Report this Comment On October 23, 2013, at 5:12 PM, dreamerdomain wrote:

    "Alcoa jumped 9% after announcing this morning".. The announce was on the morning and shares jumped only afternoon. So the explanation provided for such gap makes no sense. Intraday price and volume action looks more like short squeeze after much smaller move.

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