DJ30 PointChange: +45.33 Level: 11868.81 NASDAQ PointChange: +1.70 Level: 2541.01 NQ100 PercentChange: -0.3 R2K PercentChange: +1.1 SP400 PercentChange: +0.8 SP500 PointChange: +3.93 Level: 1215.75 NASDAQ-Adv:1465 Dec: 1067 NYSE-Adv:1872 Dec: 1108
Stocks had looked like they would come rallying back from three straight
losses, but the broad market's inability to overcome resistance in the
early going prompted many participants to exit their positions. Stocks
chopped along for the rest of the session and eventually settled with
After watching the stock market descend more than 3% during the
course of the past three sessions, buyers were finally brought back into
the fold. Their interest was initially stirred because Europe's major
bourses had been able to bounce on the back of a successful debt
offering from Spain and news of improved eurozone manufacturing activity
during December. Those themes also helped lift the euro off of the
multi-month lows that it had set in the prior session. China reported
overnight that it also experienced an improvement in manufacturing
activity during December.
Market participants were also encouraged by domestic data. The latest
initial weekly jobless claims tally fell to 366,000, which is the
smallest count since May 2008. Economists polled by Briefing.com had
generally expected a tally on the order of 390,000.
Overall producer prices increased in November by 0.3%, which came as a
surprise since a more tepid increase of 0.1% had been generally
expected. However, core producer prices increased by an in-line 0.1%.
The Empire State Manufacturing Survey improved to 9.5 for December.
Many had expected a reading of just 3.0 for the Survey. The Philadelphia
Fed Survey scored a reading of 10.3 in December, surpassing
expectations for something closer to 4.5.
Industrial production data was a bit more blemished, but that was
generally overlooked. It showed a 0.2% decline in overall activity,
contrasting with the consensus call for a 0.2% increase. Industrial
production last declined in April.
Although quarterly reports were limited in quantity, a couple of
notable announcements featured solid overall results, even if the
response to those announcements varied. The latest from FedEx (FDX 83.47, +6.18) featured a better-than-expected bottom line. Discover Financial Services (DFS 23.07, -0.75) had an upside earnings surprise of its own and even increased its quarterly dividend.
Even with all the encouraging headlines, the S&P 500 still
couldn't overcome resistance in the 1225 region, which contains its
50-day moving average. The failure to build on opening gains made many
skeptical of the stock market's strength. That prompted plenty of people
to pocket profits and drive down the major averages. Although the broad
market stayed in positive territory, stocks never returned to session
Financials had been the biggest beneficiaries of the early bounce by
breaking out to a 1.5% gain. By session's end all of that was dashed --
the sector finished flat.
Technology-related stocks lagged almost all session, causing the
tech-rich Nasdaq to trail its counterparts. Tech stocks settled with a
collective loss of 0.3%, which is the worst of the major sectors.
Defensive-oriented issues displayed strength for most of the session.
That helped the consumer staples, health care, and utilities sectors
all book gains of 1% or more. Utilities stocks are actually among this
year's strongest performers; the sector is currently sitting on a
year-to-date gain of about 11%, while the broad market is down about 3%
Utilities +1.4%, Health Care +1.1%, Consumer Staples +1.0%, Industrials
+0.7%, Materials +0.6%, Consumer Discretionary +0.2%, Telecom +0.2%
Declining Sectors: Energy -0.2%, Tech -0.3%