YAHOO[BRIEFING.COM]:
All three major indices registered fresh multiyear closing lows in the prior
session, but came rallying back this session to log their best single-session
performance by percent in months. The rebound came after Citigroup issued an
encouraging update and reports indicated the uptick rule may be reinstated.
Citigroup
(C 1.45, +0.40) told investors that it earned a profit during the first two
months of 2009. Given the conditions and challenges facing the financial
sector, news that the beleaguered financial giant is moving in the right
direction supported a bid for financial stocks.
Financial stocks were further bolstered by reports that House
Financial Services Chairman Barney Frank said he believes the Securities
and Exchange Commission (SEC) will reinstate the uptick rule as early as
next month. The rule would help prevent traders from adding to the momentum of
falling stocks. That could be particularly helpful to financial stocks, which
have fallen more than 40% year-to-date.
Investors are also hoping that a congressional committee meeting
this week will move to temporarily relax mark-to-market rules. The rules have
caused banks and financial firms to incur massive write-downs, which have driven
losses and destroyed capital.
Rep. Frank stated mark-to-market accounting rules must be improved,
but Senator Shelby says any mark-to-market accounting changes should be made by
the SEC. The SEC stated it will not seek to suspend such rules.
Financial stocks surged 15.6% this session, providing leadership to
the broader market, which had become quite oversold in recent sessions. The
stock market's advance was further helped by short-covering. Still, trading
volume on the NYSE climbed above 2 billion shares, which is well above recent
averages, suggesting there was also some conviction behind the advance.
Roughly 97% of the companies in the S&P 500 finished with a
gain. All 30 of the Dow components closed higher.
Investors showed little reaction to Fed Chairman Bernanke's speech
about financial reform and systemic risk.
Other corporate news also had little effect on sentiment. Whirlpool (WHR 23.11, +3.72)
reaffirmed its 2009 outlook, which allows for an upside surprise, but United Technologies (UTX 40.79,
+3.23) issued estimates that fall short of the consensus.
Economic data was lackluster. Monthly wholesale inventories fell
0.7% in January. Economists, on average, expected a decline of 1.0% in January.
The prior reading was revised modestly lower to reflect a 1.5% decline. DJ30
+379.44 NASDAQ +89.64 NQ100 +6.6% R2K +7.1% SP400 +6.9% SP500 +43.07 NASDAQ
Adv/Vol/Dec 2243/2.15 bln/468 NYSE Adv/Vol/Dec 2918/2.15 bln/221