Good earnings reports and encouraging retail sales data help market close higher for third straight day
Technology, telecom and energy stocks pushed US Market considerably higher today, Wednesday, 13 February, 2008. Right from the very start, positive sentiment dominated the market after couple of good earnings reports and encouraging retail sales data. All ten of the major economic sectors finished in positive territory. Today's advance marked the stock market's third consecutive advance.
Before market opened today morning, The Dept. of Commerce said January retail sales grew by 0.3%, and also grew by 0.3% excluding autos. Market was in fact expecting a decrease of 0.3% for retail sales, and rise of 0.2% when excluding autos.
The Dow Jones industrial Average ended the day with a gain of 179 points at 12,552. The Nasdaq Composite Index, finished higher by 54 points at 2,374. S&P 500 finished higher by 18 points at 1,367.
Twenty-five out of thirty Dow stocks ended in the green today. American Express led the group of Dow winners with shares soaring by almost 4%. For the Nasdaq, it was Applied Materials whose stock today climbed by almost 10%.
CoCo Cola and Applied Materials beat earnings expectation
With regard to earnings, Coca-Cola and Applied Materials topped expectations. CoCo Cola reported 79% quarterly profit growth and said that it expects to enjoy a "good" 2008, but surprisingly its shares were among the Dow's laggards, and finished off 0.9%.
Applied Materials, which is the largest supplier of chipmaking equipment said that profit fell but still came in better than analysts expected. The stock gave technology sector a very good boost today.
On the technology front, Yahoo stock advanced more than 1% today on rumours that the company is in talk with Rupert Murdoch's Newscorp to ward off Microsoft's take-over proposal.
Indian ADRs closed mixed today. HDFC Bank and ICICI Bank were the two topmost gainers closing up by 4.4% and 2.4% respectively.
Energy sector gave the late day push to stocks today after crude closed marginally higher.
Crude prices erased earlier loss and finally closed higher for the day today. Prices initially fell after government report showed that crude inventories for last week rose less than expected. But the strong retail numbers for January, 2008 knocked off recession concerns once again and crude glided up. Crude-oil futures for light sweet crude for March delivery today closed at $93.27/barrel (higher by $0.49/barrel or 0.5%) on the New York Mercantile Exchange. The price earlier rose to an intraday high of $93.9 earlier and fell to a low of $91.9.
As per the weekly inventory report by EIA today, U.S. crude inventories rose for a fifth week, up 1.1 million barrels to 301.1 million barrels in the week ending 8 February. Market was expecting a rise of 2 million barrels. U.S. crude imports averaged 9.7 million barrels per day last week, down 777,000 barrels per day from the previous week. U.S. refineries operated at 85.1% of their operable capacity last week, up from the previous week's 84.3%.
Volume on the New York Stock Exchange topped 1.4 billion, while nearly 2.2 billion shares traded on the Nasdaq. On the NYSE, two stocks gained for each issue on the decline, while gainers topped decliners 3 to 1 on Nasdaq.
Tomorrow, Fed Chairman Bernanke and Treasury Secretary Paulson are scheduled to testify on the economy and financial markets before the Senate Banking Committed in Washington. In terms of economic reports, the international trade balance and weekly jobless claims data are due before tomorrow's open.
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