YAHOO [BRIEFING.COM]: Disappointing
economic data distracted market participants from renewed strength in the euro,
but stocks were able to stage a late climb and eke out a slight gain.
The euro made its way above
$1.240 for the first time since May after Spain held a successful debt
offering, which proved that the country can still attract investors in the face
of lingering concerns about its fiscal condition. Though the euro backed off of
that mark to trade at $1.239, it still ended the day with a 0.6% gain.
Strength in the euro helped
support a positive tone to early trade, but the mood among market participants
grew negative after a couple of dour reports were released.
Initial jobless claims for the
week ended June 12 were up 12,000 week-over-week to 472,000, which is a larger
tally than the 450,000 claims that economists polled by Briefing.com had
expected. In another sign that labor markets remain stubbornly soft, continuing
jobless claims increased 88,000 week-over-week to 4.57 million, which is
greater than the 4.50 million continuing claims that many had expected.
The June Philadelphia Fed
Index made for another disappointment. The barometer of regional business
activity dropped to 8.0, a 10-month low, from 21.4. Many economists had
expected the June reading to come in closer to 21.0.
Despite the disappointing
reports, the latest consumer price data offered some assurance that the Fed can
continue to employ low interest rates in its effort to foster further economic
growth. Specifically, the May Consumer Price Index declined 0.2%
month-over-month and core prices increased 0.1% month-over-month. Economists
polled by Briefing.com had expected a 0.1% monthly decline in overall consumer
prices and a 0.1% monthly increase in core prices.
As for other data, leading
economic indicators for May made a 0.4% increase. That was only slightly less
than the 0.5% increase that had been widely expected.
The dour portion of the data
dragged down trade for the vast majority of the session. However, stocks were
able to attract some late support, which ultimately made for a positive finish.
Consumer staples stocks
(+0.7%) made some of the best gains as Kroger (KR 20.75,
+0.67) and J.M. Smucker (SJM 61.55, +3.80) provided
leadership. Both companies posted better-than-expected earnings for the latest
quarter. Kroger even issued upside guidance.
BP (BP 31.71, -0.14) continued to make
headlines as its Chief Executive sat in front of a congressional panel for a
grueling question-and-answer session regarding the events surrounding the Gulf
oil spill. Amid BP's ongoing efforts to preserve its public image and it take
steps to prepare for the financial obligations that stem from the oil spill,
CNBC reported that the company is planning to raise $5 billion to $10 billion
in a debt offering as early as next week. BP's credit rating was lowered by
S&P to A/A-1.
Participation was lacking this
session as trading volume on the NYSE barely topped 1 billion shares, which is
well below the NYSE's daily average of 1.44 billion shares for the past 50
sessions. Trading volume is likely to increase substantially tomorrow, given
the expiration of quarterly options.
In the commodities pits,
natural gas futures prices rallied 3.5% to $5.15 per MMBtu, but crude oil fell
1.1% to $76.79 per barrel. Gold prices advanced 1.3% to $1230.50 per ounce. It
came within a couple points of its all-time high of $1254.50 before easing
back. Silver price settled 1.4% higher at $18.44 per ounce.
The precious metals portion of
the CRB Commodity Index led the way higher today as it posted 1.3% gain on the
session. August gold futures closed higher by 1.3% to $1230.50 per ounce. It
came within a couple points of taking out all-time highs at $1254.50, but
ultimately fell short. July silver futures closed up 1.4% to $18.44 per ounce.
Both precious metals used worse-than-expected economic data to move higher today.
July natural gas futures
continued their recent rally today after they closed higher by 3.5% to $5.15
per MMBtu. Today's inventory data was a relative non-event. July crude oil
finished lower by 1.1% to $76.79 per barrel.
Advancing Sectors: Utilities (+0.8%), Consumer Staples
(+0.7%), Tech (+0.5%), Industrials (+0.2%), Energy (+0.1%), Health Care (+0.1%)
Declining Sectors: Consumer Discretionary (-0.6%), Materials
(-0.3%), Financials (-0.1%), Telecom (-0.1%) DJ30 +24.71 NASDAQ +1.23 NQ100
+0.3% R2K +0.0% SP400 -0.2% SP500 +1.43 NASDAQ Adv/Vol/Dec 1316/1.77 bln/1284
NYSE Adv/Vol/Dec 1489/1.16 bln/1506