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Wall Street ends flat on euro zone debt woes
Source: Agencies |
December 7, 2010, Tuesday
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US stocks ended little changed yesterday, held in check by worries about Europe's debt crisis, which frustrated investors looking for a reason to take shares to new highs for the year.
Germany rejected a call for euro zone finance ministers to increase the size of a 750 billion euro safety net for debt-stricken members.
A decline in the euro limited U.S. stocks' advance as the two have have moved in a tight correlation recently, with the euro acting as a proxy for debt concerns overseas.
Further adding to conflicting sentiment were downbeat comments from US Federal Reserve Chairman Ben Bernanke about the economy, which offset his attempts to reassure markets the Fed could step up its economic stimulus efforts if necessary.
"The tone of his voice made me nervous. As a trader and a manager, it made me nervous," said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont.
"I think he was trying to sell the American people because he has been under pressure.
The Dow Jones industrial average dropped 19.90 points, or 0.17 percent, to 11,362.19. The Standard & Poor's 500 Index shed 1.59 points, or 0.13 percent, to 1,223.12. The Nasdaq Composite Index gained 3.46 points, or 0.13 percent, to 2,594.92.
Technology shares limited declines after positive brokerage comments on Cisco Systems Inc and Cognizant Technology Solutions Corp. Cisco rose 1.9 percent to US$19.43 after Oppenheimer raised the stock to "outperform," and Cognizant added 0.7 percent to US$69.80 after Goldman Sachs boosted it to "buy."
Despite the day's dip, analysts see the S&P 500 soon breaking out of its recent range and surpassing its current intraday high for the year just above 1,227 reached on Nov. 5.
Analysts view key resistance for the benchmark index at 1,228 because it's just above the year's high and coincides with the 61.8 percent Fibonacci retracement of the 2007-2009 bear market slide.
"If the (euro) problem is again, pushed forward and that relief comes off the market, the market will probably push higher here towards new highs into year-end," added Mendelsohn.
Also looking ahead in equities, Goldman Sachs Asset Management Chairman Jim O'Neill, speaking at the Reuters 2011 Investment Outlook Summit in New York, gave a bullish view on stocks, saying global equity markets are likely to see gains of up to 20 percent through 2011.
Volume was light with about 6.27 billion shares traded on the New York Stock Exchange, the American Stock Exchange and Nasdaq, well below the year-to-date average of 8.62 billion.
Declining stocks slightly outnumbered advancing ones on the NYSE by 1,502 to 1,464, while on the Nasdaq, advancers beat decliners by a ratio of about 4 to 3. (Reporting by Chuck Mikolajczak; Editing by Kenneth Barry)
Germany rejected a call for euro zone finance ministers to increase the size of a 750 billion euro safety net for debt-stricken members.
A decline in the euro limited U.S. stocks' advance as the two have have moved in a tight correlation recently, with the euro acting as a proxy for debt concerns overseas.
Further adding to conflicting sentiment were downbeat comments from US Federal Reserve Chairman Ben Bernanke about the economy, which offset his attempts to reassure markets the Fed could step up its economic stimulus efforts if necessary.
"The tone of his voice made me nervous. As a trader and a manager, it made me nervous," said Paul Mendelsohn, chief investment strategist at Windham Financial Services in Charlotte, Vermont.
"I think he was trying to sell the American people because he has been under pressure.
The Dow Jones industrial average dropped 19.90 points, or 0.17 percent, to 11,362.19. The Standard & Poor's 500 Index shed 1.59 points, or 0.13 percent, to 1,223.12. The Nasdaq Composite Index gained 3.46 points, or 0.13 percent, to 2,594.92.
Technology shares limited declines after positive brokerage comments on Cisco Systems Inc and Cognizant Technology Solutions Corp. Cisco rose 1.9 percent to US$19.43 after Oppenheimer raised the stock to "outperform," and Cognizant added 0.7 percent to US$69.80 after Goldman Sachs boosted it to "buy."
Despite the day's dip, analysts see the S&P 500 soon breaking out of its recent range and surpassing its current intraday high for the year just above 1,227 reached on Nov. 5.
Analysts view key resistance for the benchmark index at 1,228 because it's just above the year's high and coincides with the 61.8 percent Fibonacci retracement of the 2007-2009 bear market slide.
"If the (euro) problem is again, pushed forward and that relief comes off the market, the market will probably push higher here towards new highs into year-end," added Mendelsohn.
Also looking ahead in equities, Goldman Sachs Asset Management Chairman Jim O'Neill, speaking at the Reuters 2011 Investment Outlook Summit in New York, gave a bullish view on stocks, saying global equity markets are likely to see gains of up to 20 percent through 2011.
Volume was light with about 6.27 billion shares traded on the New York Stock Exchange, the American Stock Exchange and Nasdaq, well below the year-to-date average of 8.62 billion.
Declining stocks slightly outnumbered advancing ones on the NYSE by 1,502 to 1,464, while on the Nasdaq, advancers beat decliners by a ratio of about 4 to 3. (Reporting by Chuck Mikolajczak; Editing by Kenneth Barry)
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