YAHOO [BRIEFING.COM]: Stocks finished the week in lackluster
fashion, but the S&P 500 still posted another weekly gain -- the eighth in
nine weeks. Commodities were cut down, though.
Early action was choppy and without leadership. It was also
undermined by weakness in the Energy sector, which came under pressure in
conjunction with lower oil prices. The Energy sector settled with a 1.1% loss,
which is worse than what any other sector suffered, while oil closed pit trade
with a 1.9% loss at $106.68 per barrel. Earlier this week oil hit a multi-month
high near $110 per barrel.
The major equity averages set impressive marks of their own earlier
this week. The Nasdaq notched its highest level in more than a decade, while
the Dow and S&P 500 both printed their best intraday levels since 2008.
Along the way the Nasdaq Composite kissed the 3,000 mark, but failed to hold
its ground there. The Dow closed above the psychologically significant 13,000
line after a few failed attempts, but was backed down by week's end.
With the major equity averages trading at such heady levels, many
pundits are predicting a pullback, especially since stocks are showing some
signs of fatigue. In anticipation of possible volatility, there was strong
rotation into the dollar. The dollar marked its lowest level of the past three
months earlier this week, but it finished out the week in impressive fashion.
Its 0.8% gain on Friday helped fuel a weekly gain of 1.2%.
Efforts to reduce risk were more pronounced among commodities.
While oil's tumble made the most headlines, the rest of the complex was also
clipped aggressively. That resulted in a 1.0% loss for the CRB Index on Friday.
It fell 1.5% for the week.
Share volume has been paltry all week and was especially pathetic
on Friday. Against an uncertain near-term outlook for the market, the absence
of corporate news or economic data of consequence suppressed share volume,
which barely totaled 520 million shares on the NYSE.
Market participants got a substantial helping of data on Thursday,
overshadowing a raft of same-store sales results, which actually proved
impressive.
The latest initial jobless claims count totaled 351,000, which is
little changed from the prior week's tally of 353,000, but also on par with the
355,000 claims that had been expected, on average, among economists polled by
Briefing.com. The numbers were supportive of an improving labor market picture,
even though the headline unemployment rate remains elevated.
Personal spending increased in January by 0.2%, but income
increased by 0.3%. Neither was as strong as what had been expected -- the
Briefing.com consensus called for a 0.4% increase in both pieces of data.
The ISM Manufacturing Index fell to 52.4 in February from 54.1 in
the prior month, but it still suggested that manufacturing activity expanded
during the month. Nonetheless, expectations called for an improvement to 54.7,
making the report a disappointment.
Construction spending for January also proved displeasing. It
slipped by 0.1%, which isn't drastic, but it came in stark contrast with
expectations for a 1.0% increase.
Fed Chairman Bernanke delivered a semiannual monetary policy report
to the Senate Banking Committee on Thursday, but his comments reflected those
he delivered to the House Financial Services Committee on Wednesday. Altogether
the Chairman's remarks weren't surprising, but the lack of reassurance
regarding the Fed's commitment to an accommodative monetary policy was credited
for inviting selling interest.
Prior to Bernanke's report market participants learned that fourth
quarter GDP was revised upward to a clip of 3.0%, which is greater than the
2.8% that had been reported in the advance reading. The upward revision came as
a surprise since no change had been expected, but there response to the news
was restrained.
Consistent with an improving macro picture, the Fed's Beige Book
indicated that overall economic activity continued to increase at a modest to
moderate pace in January and early February. That's not to say that all
activity is consistently improving, though.
Data unveiled earlier in the week indicated that durable goods
orders fell in January by 4.0%, which is far worse than the 1.4% decline. The
steeper-than-expected drop follows an upwardly revised 3.2% increase in the
prior month. Excluding transportation, durable goods orders declined during
January by 3.2%, which contrasts sharply with the 0.2% increase that many
economists had expected to follow a downwardly revised increase of 2.1% in the
prior month.
The Conference Board's Consumer Confidence Index ran up 70.8 in
February. It was at only 61.5 the month before. Many had expected only a modest
improvement to 62.5. Sentiment surrounding housing improved with news that
pending home sales increased by 2.0% in January. That was double the pace that
had been generally predicted among economists.
Europe was in sharp focus at the start of the week because of news
that G-20 officials want eurozone officials to establish additional financial
safeguards before more funds are made available to the International Monetary
Fund for commitment to the continent. It came back into focus by mid-week
because of news that more than 800 banks in
There wasn't a great deal of corporate news in play this week, but Apple (AAPL 545.18, +0.71) made headlines when
its market cap ballooned to more than a half of a trillion dollars.
In energy, Apr crude oil continued its losses in the afternoon
session, hitting lows of $105.80. Crude attempted a small move upward, but it
took a small dip again minutes before the floor trading close, ending the
session losing 1.9% to $106.68/barrel.
Apr natural gas managed to stay in the black its entire session. Nat gas spiked
to a morning session high of $2.51 and slowly inched its way lower in the
afternoon, finishing 1 cent higher at $2.48.
In metals, Apr gold and May silver both spent their sessions in
negative territory. Silver had a session low of $34.38 before attempting a
small recovery an hour before its session closed. Gold managed to stay above
the $1700 level. Gold ended 0.7% lower at $1709.20, while silver closed 3%
lower at $34.38.
Earnings announcements were relatively limited, but Transocean (RIG 54.19, +0.62) posted numbers that
were met with a positive response earlier this week. Home improvement retailer Lowe's (LOW 28.13, -0.25) announced quarterly
results that featured an upside earnings surprise. DJ30 -3.18 NASDAQ -12.78
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