YAHOO [BRIEFING.COM]: Broad-based
buying on the back of upbeat data boosted the major indices to fresh 52-week
highs, but the widely watched Dow couldn't quite make its way to the
psychologically significant 11,000 mark.
The stock market was closed in
observance of Good Friday when the latest nonfarm payrolls report was released
last week, so many market participants treated the jobs numbers like new.
Though the numbers were mixed, including a smaller-than-expected increase of
162,000 in total jobs during March and a steady unemployment rate of 9.7%, a
deeper dig into the data revealed that there was a larger-than-expected
increase in private sector payrolls.
A generally positive reaction
to the jobs numbers helped give the major equity averages a positive start to
the session. Stocks added to their gains shortly after it was learned that the
ISM Service Index for March exceeded expectations to hit a multiyear high of
55.4 and that pending home sales for February made a surprise 8.2%
month-over-month increase.
Though strong data spurred a
solid buying effort, there wasn't much volume behind the move. Stocks spent the
entire afternoon in a tight range, unable to further build on their gains. For
the S&P 500 that meant that it would spend the afternoon bumping up against
the 1187 to 1188 zone, while the Dow Jones Industrial Average couldn't quite
close the gap on 11,000 -- both levels were last seen in September 2008.
Buyers favored energy stocks
the most this session. That helped the sector ascend to a 1.6% gain. Higher oil
prices helped. Contract prices for crude oil hit an 18-month high just shy of
$87 per barrel before it settled with a 2.1% gain at $86.62 per barrel.
The reflation trade also
helped materials stocks, which tacked on 1.2% this session. Steel plays (+3.8%)
provided the most support to the sector, but metal and mining giant Alcoa
(AA 14.73, +0.03) lagged after it was downgraded by analysts at
JPMorgan. The downgrade precedes Alcoa's quarterly earnings announcement next
week.
Tech stocks (+1.1%) were also
strong this session. Apple (AAPL 238.49, +2.52), one of the
sector's frequent leaders, lagged a bit in the early going amid suggestions
that initial sales of its latest gadget, the iPad, have been underwhelming.
Analysts at JPMorgan increased their target on the stock, however.
Health care stocks (-0.3%) and
consumer staples stocks (-0.1%), often considered defensive plays, trailed the
broader market for the entire session. Their decline suggested that broader
market participants remain more interested in riskier plays.
Energy led the commodities
space and equity markets higher this session. The move higher has been
attributed to better-than-expected economic data (this morning and Friday's
Nonfarm payrolls).
Also of note, the energy space
saw some M&A activity prior to today's session. News broke last night that SandRidge
Energy (SD 7.59 -0.26) would purchase Arena Resources (ARD
36.59 +2.33) for ~$40 in cash and stock. The deal represented ~17% premium at
the time of the announcement. Crude oil futures reached a new 18 month high
this session. May crude oil closed 2.1% higher at $86.62 per barrel. Natural
gas futures also saw significant buying interest this session. May natural gas
closed 4.4% higher at $4.27 per MMBtu. The May contract is now up over 12% off
Thursday's session low.
Precious metals saw less
pronounced gains this session. June gold closed 0.7% higher at $1130.80 per
ounce and May silver closed 1.3Z% higher at $18.12 per ounce.
On that note, small-caps and
mid-caps outperformed with ease. Specifically, the Russell 2000 Small-Cap Index
climbed 2.0%, while the S&P 400 Mid-Cap Index added 1.6%.
Meanwhile, Treasuries fell out
of favor. As a result, the yield on the benchmark 10-year Note eked past 4.00%
for the first time since this past summer. Results from a reopened auction of
$8 billion in 10-year TIPS did little to alleviate pressure. The auction drew a
yield of 1.71% with a bid-to-cover ratio of 3.4. The indirect bid came in at
37.5%.
The dollar had a quiet session
and closed with a 0.1% loss against a basket of competing currencies. Over the
weekend the U.S. Treasury decided to delay a report to Congress on the currency
policies of China, among other major trading partners.
Many major foreign markets
were closed Monday for holiday observance.
Advancing Sectors: Energy (+1.6%), Materials (+1.2%),
Consumer Discretionary (+1.2%), Tech (+1.1%), Financial (+1.0%),
Industrials (+0.8%), Telecom (+0.7%), Utilities (+0.6%)
Declining Sectors: Health Care (-0.3%), Consumer Staples
(-0.1%) DJ30 +46.48 NASDAQ +26.95 NQ100 +0.9% R2K +2.0% SP400 +1.6% SP500 +9.34
NASDAQ Adv/Vol/Dec 2028/2.04 bln/688 NYSE Adv/Vol/Dec 2298/900 mln/765