Related News
Stocks waver after upbeat economic data
Source: Agencies |
March 31, 2010, Wednesday
|
Online Edition
Online Edition
STOCK prices wavered yesterday as investors made last-minute portfolio adjustments as the end of the quarter approached.
The mood in the market was upbeat after a report that consumer confidence grew more than expected in March, although it's still well below historical levels that indicate a strong economy. A separate report showed home prices inched higher for the eighth consecutive month.
Analysts expect trading to be erratic the next two days. At the end of a quarter, institutional investors typically engage in what's known as window dressing, or trades intended to boost returns on reports sent to shareholders. Many also refrain from big moves, and yesterday's volume was also light as many traders took the day off for Passover or in advance of Easter.
A slow, steady climb higher in stocks over the past two months is also giving investors reasons to take some profits at the end of the quarter.
"A bout of profit-taking would be normal and expected after the rise we had," said Mitch Schlesinger, managing director of FBB Capital Partners in Bethesda, Maryland. With one day left in the quarter, the Dow Jones industrial average is up 4.5 percent for the period. That's a sizable gain and puts the market on pace for a strong year.
The day's economic reports followed a recent trend in data that shows the economy is improving, albeit slowly. Investors have reacted positively to similar reports in recent weeks. The Dow has risen in 18 of the past 22 days and is now at its highest level since September 2008. It was up by as much as 44 points in morning trading before the gains evaporated.
The Conference Board said its consumer confidence index rose to 52.5 in March, from 46.4 last month. Economists polled by Thomson Reuters had forecast it would rise to 50.
While the reading would indicate improvement, it is far from signaling a healthy economy. A reading above 90 means the economy is on solid footing.
"We're starting to see consumers come back in an adequate manner," said Larry Rosenthal, president of Financial Planning Services in Manassas, Virginia. "Not strong, but adequate."
In midday, the Dow fell 2.05, or less than 0.1 percent, to 10,893.81. The Standard & Poor's 500 index fell 1.66, or 0.1 percent, to 1,171.66, while the Nasdaq composite index fell 1.55, or 0.1 percent, to 2,402.81.
About three stocks fell for every two that rose on the New York Stock Exchange, where volume came to 311.9 million shares.
The Standard & Poor's/Case-Shiller home price index, which measures home values in 20 major metropolitan markets, rose 0.3 percent in January compared with the previous month. It was the eighth consecutive monthly gain. The index is up nearly 4 percent from its bottom in May 2009, showing home prices are starting to slowly recover.
The index was down 0.7 percent compared with the year-ago period, slightly better than the 0.8 percent drop forecast by economists.
Unlike other sectors of the economy, the housing market has been less consistent in its recovery. Reports on sales, defaults and prices have shown an uneven rebound.
The market has been tolerant of the erratic housing reports, and instead has mostly focused its attention on the strength of the consumer and jobs data.
Analysts say stocks and consumer confidence won't be able to push higher without evidence that the housing and job markets are improving and not just stabilizing.
The Labor Department releases its monthly employment report Friday. Economists expect it to show employers added 190,000 jobs in March, only the second increase since the recession began in 2007. Some of the jobs growth is expected to be tied to temporary government hiring for the 2010 census, which is currently under way.
In corporate news, Apple Inc. and Verizon Communications rose sharply after reports that Apple was making phones that could be used on Verizon's network.
Apple shares rose US$3.73 to US$236.12. Earlier in the session, shares hit a record high of US$237.48.
Verizon shares jumped 83 cents, or 2.7 percent, to US$31.28. Qualcomm Inc., which is the predominant manufacturer of the style of chips used in Verizon phones, rose 28 cents to US$42.04.
Bond prices were mixed. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.88 percent from 3.87 percent late Monday.
The dollar was inched higher. Gold fell, while oil rose.
The Russell 2000 index of smaller companies fell 0.95, or 0.1 percent, to 681.30.
The mood in the market was upbeat after a report that consumer confidence grew more than expected in March, although it's still well below historical levels that indicate a strong economy. A separate report showed home prices inched higher for the eighth consecutive month.
Analysts expect trading to be erratic the next two days. At the end of a quarter, institutional investors typically engage in what's known as window dressing, or trades intended to boost returns on reports sent to shareholders. Many also refrain from big moves, and yesterday's volume was also light as many traders took the day off for Passover or in advance of Easter.
A slow, steady climb higher in stocks over the past two months is also giving investors reasons to take some profits at the end of the quarter.
"A bout of profit-taking would be normal and expected after the rise we had," said Mitch Schlesinger, managing director of FBB Capital Partners in Bethesda, Maryland. With one day left in the quarter, the Dow Jones industrial average is up 4.5 percent for the period. That's a sizable gain and puts the market on pace for a strong year.
The day's economic reports followed a recent trend in data that shows the economy is improving, albeit slowly. Investors have reacted positively to similar reports in recent weeks. The Dow has risen in 18 of the past 22 days and is now at its highest level since September 2008. It was up by as much as 44 points in morning trading before the gains evaporated.
The Conference Board said its consumer confidence index rose to 52.5 in March, from 46.4 last month. Economists polled by Thomson Reuters had forecast it would rise to 50.
While the reading would indicate improvement, it is far from signaling a healthy economy. A reading above 90 means the economy is on solid footing.
"We're starting to see consumers come back in an adequate manner," said Larry Rosenthal, president of Financial Planning Services in Manassas, Virginia. "Not strong, but adequate."
In midday, the Dow fell 2.05, or less than 0.1 percent, to 10,893.81. The Standard & Poor's 500 index fell 1.66, or 0.1 percent, to 1,171.66, while the Nasdaq composite index fell 1.55, or 0.1 percent, to 2,402.81.
About three stocks fell for every two that rose on the New York Stock Exchange, where volume came to 311.9 million shares.
The Standard & Poor's/Case-Shiller home price index, which measures home values in 20 major metropolitan markets, rose 0.3 percent in January compared with the previous month. It was the eighth consecutive monthly gain. The index is up nearly 4 percent from its bottom in May 2009, showing home prices are starting to slowly recover.
The index was down 0.7 percent compared with the year-ago period, slightly better than the 0.8 percent drop forecast by economists.
Unlike other sectors of the economy, the housing market has been less consistent in its recovery. Reports on sales, defaults and prices have shown an uneven rebound.
The market has been tolerant of the erratic housing reports, and instead has mostly focused its attention on the strength of the consumer and jobs data.
Analysts say stocks and consumer confidence won't be able to push higher without evidence that the housing and job markets are improving and not just stabilizing.
The Labor Department releases its monthly employment report Friday. Economists expect it to show employers added 190,000 jobs in March, only the second increase since the recession began in 2007. Some of the jobs growth is expected to be tied to temporary government hiring for the 2010 census, which is currently under way.
In corporate news, Apple Inc. and Verizon Communications rose sharply after reports that Apple was making phones that could be used on Verizon's network.
Apple shares rose US$3.73 to US$236.12. Earlier in the session, shares hit a record high of US$237.48.
Verizon shares jumped 83 cents, or 2.7 percent, to US$31.28. Qualcomm Inc., which is the predominant manufacturer of the style of chips used in Verizon phones, rose 28 cents to US$42.04.
Bond prices were mixed. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.88 percent from 3.87 percent late Monday.
The dollar was inched higher. Gold fell, while oil rose.
The Russell 2000 index of smaller companies fell 0.95, or 0.1 percent, to 681.30.
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 沪ICP证：沪ICP备05050403号-1
- |
- 互联网新闻信息服务许可证：31120180004
- |
- 网络视听许可证：0909346
- |
- 广播电视节目制作许可证：沪字第354号
- |
- 增值电信业务经营许可证：沪B2-20120012
Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
