YAHOO [BRIEFING.COM]: The
S&P 500 gapped down in the early going and traded with a 1.7% loss at its
session low, but a downturn by the dollar caused stocks to rally into the
afternoon. The major indices were able to reverse nearly all of their losses
and finish near session highs.
Stocks looked like they were
headed for a dismal session as all 10 of the major sectors in the S&P 500
dropped to losses in excess of 1% in the early going. Pessimism among
participants was rooted in a disappointing batch of economic data and moderate
strength in the dollar.
According to the latest weekly
jobless claims figures, initial claims climbed for the week ended Feb. 20
totaled 496,000, up 22,000 week-over-week. Not only was that worse than
expected, it was the highest initial claims count since November. Continuing
claims were worse than expected; they totaled 4.62 million.
Durable goods orders failed to
temper the negative reaction to the jobless claims numbers. Specifically,
durable goods orders increased a stronger-than-expected 3.0% in January, but
orders less transportation made a surprise 0.6% decline.
Housing prices for December
made a 1.6% monthly decline. They had been expected to increase 0.4%.
Fed Chairman Bernanke
testified on monetary policy and economy conditions before the Senate Banking
Committee this morning, but his comments reflected those that he offered to the
House Financial Services Committee yesterday. In turn, the testimony was
generally a non-factor.
In addition to a disappointing
lot of data, participants had to grapple with gains by the greenback. The
dollar garnered support amid news that Moody's believes ratings on Greece hinge
on the country's fiscal reform follow through. Though that comment didn't offer
anything new, it had substance in the sense that Moody's is the last ratings
agency to have an 'A' rating on Greek sovereign debt. An 'A' rating is required
of a country to exchange its bonds with the European Central Bank as collateral
for loans under rules that will go into effect at the end of this year. Failure
to maintain such a rating could prove problematic as Greece attempts to remedy
its fiscal woes.
Despite such consideration,
the euro eventually bounced back and pressured the dollar, which finished the
session with a 0.1% loss against a basket of foreign currencies. The dollar's
reversal helped the stock market break free from range-bound trade near session
lows.
Materials stocks were among
the primary beneficiaries. The sector had been down more than 2% at its session
low, but settled with a modest 0.2% loss. Newmont Mining (NEM
49.02, +2.54) was a primary leader, thanks to better-than-expected earnings for
its latest quarter.
Better-than-expected earnings
from Limited Brands (LTD 22.15, +0.61) and Kohls (KSS
54.08, +2.49) helped retailers outperform the broader market for the third
straight session. Retailers finished with a 0.4% gain, collectively, which
helped the consumer discretionary sector settle with a fractional loss. That
made it the best performing sector in the broader market.
One of the session's strongest
gains was made by Coca-Cola Enterprises (CCE 25.48, +6.30),
which surged amid news that its North American bottling business will be
acquired by Coca-Cola (KO 53.12, -2.04).
Though the stock market was
able to rally amid the greenback's pullback, commodities had a mixed response
as the CRB Commodity Index stayed stuck near its session low. It finished with
a 1.4% loss. Oil prices gradually made their way off of session lows, but still
settled pit trade with a 2.3% loss at $78.17 per barrel. Meanwhile, gold closed
with a 1.0% gain at $1108.50 per ounce.
Treasuries traded with
moderate strength. They were partly supported by strong results from an
at-record $32 billion auction of 7-year Notes. The auction attracted a yield of
3.08%, which was a bit below what had been expected, and a bid-to-cover ratio
of 2.98, which was above the recent average of 2.75. However, the indirect bid
hit 40.3%, which was below the recent average of 54.4%.
Advancing Sectors: (None)
Declining Sectors: Telecom (-0.4%), Utilities (-0.3%),
Financials (-0.3%), Industrials (-0.3%), Tech (-0.2%), Materials (-0.2%),
Energy (-0.2%), Consumer Staples (-0.1%), Health Care (-0.1%), Consumer
Discretionary (-0.1%)DJ30 -53.13 NASDAQ -1.68 NQ100 +0.00% R2K +0.1% SP400 +0.0%
SP500 -2.30 NASDAQ Adv/Vol/Dec 1121/2.27 bln/1500 NYSE Adv/Vol/Dec 1512/1.15
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