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Stocks edge up to close strong October
Source: Agencies |
October 30, 2010, Saturday
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STOCKS edged higher yesterday to close out the best October for the Dow Jones industrial average in four years.
Trading activity was relatively light, with the Dow keeping to a tight range of just 50 points, amid uncertainty over next week's elections. News that the US economy rose at just a 2 percent annual pace in the three months ending in September had little effect on stock prices.
The Dow Jones industrial average rose 4.54, or 0.1 percent, to close at 11,118.49. The Standard and Poor's 500 Index fell 0.52, or 0.1 percent, to 1,183.26, while the technology focused Nasdaq composite index rose less than a point to 2,507.41.
Every market index was up more than 3 percent for the month. The Nasdaq finished October with a 5.9 percent gain.
For the first time since April, major stock indexes have risen for two months in a row. The Dow and S&P are both up about 6 percent for the year, while the Nasdaq is up 10.5 percent.
Since September, the Standard and Poor's 500 index, perhaps the best measure of the stock market, is up 12.76 percent. King Pharmaceuticals Inc., which was up 42 percent in October after Pfizer Inc. announced plans to buy it, was the index's best performing stock. Apollo Group Inc., which fell 27 percent in October after the company said that new government regulation would affect its profit, was the index's worst performer.
Normally slow GDP growth would have driven stocks much lower. But signs of weak economic expansion have built up expectations that the Federal Reserve will take bold steps to boost the economy when it meets early next week.
"Because GDP was so lackluster, we don't see the Fed pumping the brakes" on its plan, said Tony Zabiegala, a partner at Strategic Wealth Partners.
Stocks rose sharply during the first half of October as expectations mounted that the Fed would start buying Treasury bonds to drive interest rates lower. That, in turn, is supposed to spark spending and lending. In recent days, however, the size of the bond-buying program has been questioned, putting a market rally on hold.
John Apruzzese, a partner and portfolio manager at Evercore Wealth Management, said reaction in anticipation in the program is typical of the market.
"This is a classic situation where all the market movement is done in anticipation," Apruzzese said.
Trading activity was relatively light, with the Dow keeping to a tight range of just 50 points, amid uncertainty over next week's elections. News that the US economy rose at just a 2 percent annual pace in the three months ending in September had little effect on stock prices.
The Dow Jones industrial average rose 4.54, or 0.1 percent, to close at 11,118.49. The Standard and Poor's 500 Index fell 0.52, or 0.1 percent, to 1,183.26, while the technology focused Nasdaq composite index rose less than a point to 2,507.41.
Every market index was up more than 3 percent for the month. The Nasdaq finished October with a 5.9 percent gain.
For the first time since April, major stock indexes have risen for two months in a row. The Dow and S&P are both up about 6 percent for the year, while the Nasdaq is up 10.5 percent.
Since September, the Standard and Poor's 500 index, perhaps the best measure of the stock market, is up 12.76 percent. King Pharmaceuticals Inc., which was up 42 percent in October after Pfizer Inc. announced plans to buy it, was the index's best performing stock. Apollo Group Inc., which fell 27 percent in October after the company said that new government regulation would affect its profit, was the index's worst performer.
Normally slow GDP growth would have driven stocks much lower. But signs of weak economic expansion have built up expectations that the Federal Reserve will take bold steps to boost the economy when it meets early next week.
"Because GDP was so lackluster, we don't see the Fed pumping the brakes" on its plan, said Tony Zabiegala, a partner at Strategic Wealth Partners.
Stocks rose sharply during the first half of October as expectations mounted that the Fed would start buying Treasury bonds to drive interest rates lower. That, in turn, is supposed to spark spending and lending. In recent days, however, the size of the bond-buying program has been questioned, putting a market rally on hold.
John Apruzzese, a partner and portfolio manager at Evercore Wealth Management, said reaction in anticipation in the program is typical of the market.
"This is a classic situation where all the market movement is done in anticipation," Apruzzese said.
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