YAHOO [BRIEFING.COM]: Trade this week started on a soft note, but
stocks were able to rebound for four consecutive gains that too, the S&P
500 back above 1400 for a 1.8% weekly gain. That stands as the best weekly
performance for the broad market measure in six weeks.
Overall action was relatively quiet on Friday as market participants
shrugged off news that analysts at S&P issued another downgrade of
Consumer Discretionary stocks led for virtually the entire day. The
sector's 1.3% gain today came with help from Amazon.com (AMZN 226.85, +30.86), which rallied to a
2012 high in response to earnings that easily exceeded what had been widely
expected. A handful of analyst upgrades helped the case for shares of the
internet-based retailer. Expedia
(EXPE 40.31, +7.68) benefited from a similar response on the back of its
better-than-expected report. For the week, Consumer Discretionary advanced
2.8%.
Typical leaders Tech, Financials, and Energy all lagged. As such,
they finished the session at the flat line. For the week, Tech advanced 2.4%.
Although it was hampered on Friday by a sharp drop in shares of Western Digital (WDC 37.93, -6.17), which plunged when
disappointing commentary from management cast a pall of what was otherwise a
strong quarterly report, earlier in the week shares of Apple (AAPL 603.00, -4.70) rallied hard to lift
the Tech sector after the company had reported another thoroughly impressive
quarterly report. Interestingly, shares of AAPL had suffered in the prior
session because of concern about a decline in the number of products it has had
hooked up to data networks. Meanwhile, both Financials and Energy booked weekly
gains on the order of 2%. On Friday Energy giant Chevron (CVX 106.20, -0.02) reported earnings
that exceeded what had been expected, contrasting the earnings miss that Exxon Mobil (XOM 86.08, +0.01) posted earlier in the
week.
Softness at the start of the week came in response to news that
Things firmed up after the S&P 500 was able to find support at
its monthly closing low of 1358, which is also only a single point above its
monthly intraday low of 1357. Stocks began their rebound from there.
The Fed was busy this week as the FOMC surprised few by keeping its
fed funds rate at 0.00% to 0.25%, and noting that it anticipates exceptionally
low levels of the fed funds rate at least through late 2014. Although it was
acknowledged that inflation has picked up somewhat, the outlook for inflation
over the medium run remains subdued. In fact, the Fed forecasted that inflation
for the next couple of years will not surpass 2.0%.
The Fed added 20 basis points to both ends of its forecast for 2012
real GDP so that the range is now from 2.4% and 2.9%, but the forecast for 2013
was trimmed by 10 basis points to range from 2.7% to 3.1%. Longer run growth is
still expected to range from 2.3% to 2.6%.
In a follow-up to the FOMC statement and forecast, Fed Chairman
Bernanke held a press conference, during which he stated that the FOMC is
prepared to take additional actions, if necessary. That was widely regarded by
many market participants as a tacit sign that further quantitative easing is
not off of the table.
Leading up to the GDP report on Friday morning, participants
digested several important pieces of data, including news that new home sales
for March hit an annualized pace of 328,000, which is greater than the clip of
318,000 that had been broadly anticipated. Moreover, prior month numbers were
revised upward to reflect an annualized pace of 353,000. Pending home sales
reportedly spiked in March by 4.1%, which is far greater than the 0.5% increase
that economists polled by Briefing.com had generally expected.
The Consumer Confidence Index for April eased back to 69.2 from
70.2 in the prior month, but on Friday it was reported that the final Consumer
Sentiment Survey for April from the
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%.
Crude oil chopped around in negative territory during morning pit
trade, but climbed into the black this afternoon to settle at $104.85 per
barrel. The energy component booked a weekly gain of 1.0% amid a volatile week
full of news that included underwhelming PMI data from both China and Europe
that pointed to soft demand, reports of export cessation by Iraq via Turkey,
news that Iran is considering a halt of nuclear expansion to avert an EU oil
ban, and a bearish inventory report.
Natural gas spent the majority of its floor session climbing
higher, making up for some of yesterday's loss, which came despite inventory
data that showed a build of 47 bcf when a build of 50
bcf was widely expected. Overall, natural gas
finished Friday at $2.18 per MMBtu for a weekly gain
of 8.0%.
Precious metals held on to modest gains from morning pit trade,
helped partly by a weaker dollar. Gold traded in a consolidative pattern during
afternoon activity, while silver inched back up after a slight mid-session
slip. Despite the mid-week volatility that came in conjunction with a FOMC
statement that suggested the economy has been expanding moderately and that the
medium run outlook for inflation remains subdued in the face of a recent
increase in inflation, gold gained 1.3% this week by settling at $1664.80 per
ounce. Silver finished at $31.33 per ounce for a 1.1% weekly loss.
Weekly initial jobless claims totaled 388,000, which is greater
than the 373,000 claims that economists polled by Briefing.com had generally
expected. The prior week tally was 389,000 claims. DJ30 +23.69 NASDAQ +18.59
NQ100 +0.6% R2K +0.9% SP400 +0.5% SP500 +3.38 NASDAQ Adv/Vol/Dec
1635/1.77 bln/867 NYSE Adv/Vol/Dec 2012/784 mln/978