YAHOO [BRIEFING.COM]: The Fed was in focus this afternoon, but
today's advance is really owed to a strong rally by the market's biggest stock,
Apple (AAPL 610.00,
+49.72).
Shares of AAPL lagged in the prior session because of concerns
about a decline in the number of connections its products made to data networks
in the last quarter, but those worries were put to rest with the release of
financial results that far surpassed what Wall Street had expected. Strength in
the stock helped drive the Tech sector to a gain greater than 3%, and helped
lead the Tech-Rich Nasdaq to
a gain of more than 2%.
Although the advance by AAPL shares helped bring about a strong,
broad bid, Telecom stocks had difficulty building on their prior session
performance. The sector settled with a gain of just 0.1% after it had advanced
almost 3% yesterday.
The Fed was busy at work today. Fed Chairman Bernanke stated during
his press conference that the FOMC is prepared to take additional actions, if
necessary. That reassured many market participants that further quantitative
easing is still a possibility. Stocks traded higher in response to the remark,
but they could not hurdle the heights set in the early going.
Bernanke’s comments came shortly after the Fed’s forecast for GDP
was released. The Fed now anticipates that real GDP for 2012 will grow at a
pace between 2.4% and 2.9%, up from the range of 2.2% to 2.7% that was issued
in January. However, the forecast for 2013 now calls for real GDP growth to
range from 2.7% to 3.1%, down from the range of 2.8% to 3.2%, while the range
for growth in 2014 is expected to range from 3.1% to 3.6%, down from 3.3% to
4.0%. Longer run growth is still expected to range from 2.3% to 2.6%. Inflation
estimates for the next couple of years are capped at 2.0%.
Earlier in the day the FOMC indicated in its Policy Statement that
inflation has picked up somewhat, but the outlook for inflation over the medium
run remains subdued. With that in mind the FOMC kept its fed funds rate at
0.00% to 0.25%, and anticipates exceptionally low levels of the fed funds rate
at least through late 2014.
Only little attention was paid to the latest durable goods orders
data, which were released ahead of the open. Total durable goods orders dropped
in Mach by 4.2%, which is steeper than the 1.7% decline that had been broadly
expected. Prior month numbers were revised lower to reflect an increase of
1.9%. Excluding transportation items, durable goods orders declined in March by
1.1%, which comes in stark contrast with the 0.5% increase that had been broadly
anticipated. Orders less transportation for the prior month had increased by an
upwardly revised 1.9%.
Boeing
(BA 77.08, +3.87), Caterpillar
(CAT 103.44, -4.96), Credit Suisse
(CS 25.19, -1.02), Eli Lilly (LLY 40.80, +0.84), Northrop Grumman (NOC 63.01, +0.28), Sprint Nextel (S 2.43, -0.04), and WellPoint (WLP 70.40, -0.36) were
among the more widely held names that were in focus for their latest earnings
results. Each exceeded what had been widely expected of it. However, both Delta Air Lines (DAL 10.48, +0.00)
and GlaxoSmithKline
(GSK 46.00, -1.21) came short of the consensus.
Crude oil experienced big swings in today’s pit trade. It sold-off
into the red following headlines that
Natural gas, on the other hand, steadily climbed higher for all of
pit trade, finishing at a session high of $2.07 per MMBtu
for a 5.1% gain.
Precious metals experienced extensive volatility in pit trade. Gold
spent the majority of its floor session in negative territory, but its session
low of $1625.00 per ounce was set moments after the FOMC statement suggested
that the economy has been expanding moderately and even though inflation has
picked up, the medium run outlook for inflation remains subdued. Silver sold
off to a session low of $29.92 per ounce at the same time. Both metals
attempted to bounce back. Gold settled pit trade with a loss of just 0.1% at
$1641.90 per ounce, while silver settled with a more sizable loss of 1.1% at
$30.42 per ounce.
Advancing Sectors:
Tech +3.2%, Materials +2.3%, Consumer Discretionary +1.7%, Health Care +1.1%,
Energy +0.9%, Financials +0.9%, Consumer Staples +0.5%, Utilities +0.5%, Industrials
+0.3%, Telecom +0.1%
Declining Sectors:
NoneDJ30 +89.16 NASDAQ +68.03 NQ100 +2.7% R2K +1.8% SP400 +1.8% SP500 +18.72
NASDAQ Adv/Vol/Dec 1846/1.71 bln/671 NYSE Adv/Vol/Dec 2323/822 mln/686