Daily Comments
US: bulls and bears end the summer neck and neck
01.09.2010 9:37:00 Zareena Sayeedova, Senior Analyst, Global Markets (Finam)
On Tuesday, August 31, the US stock market showed mixed performance mostly with positive trends, though. The high-tech sector posted losses by the final bell. For most of the trading session, the market was struggling to find its footing amid ambivalent economic data. For the record, the Chicago PMI slipped from 62.3 to 56.7 in August as opposed to the projected 57.0 reading, while the consumer confidence index climbed from 50.4 to 53.5 vs. the median estimate of 50.5. In addition, secondary figures for home prices in 20 major cities were unveiled yesterday, with the S&P/Case-Shiller Composite Index up 4.2% y-o-y in June, overcoming expectations. However, taking its calculation method into account, it is safe to assume that the index’s upturn in June is largely attributable to federal tax incentive programs which were in place in April and May.
The external environment for the US trading session was equally mixed, with most Asian markets heading south, while European bourses managed to pare their losses by the close and end the session with green on the screen.
By the final bell, the blue-chip gauge Dow Jones Industrial Average inched up 4.99 points, or 0.05%, to 10,014.72, while the broad-based Standard & Poor's 500 Index was up a mere 0.41 point, or 0.04%, and closed at 1,049.33. The tech-heavy Nasdaq Composite Index declined 5.94 points, or 0.28%, to reach 2,114.03.
On the commodity front, light, sweet crude oil futures for October delivery rolled back 3.7% to USD 71.92/bbl in NYMEX trading, while COMEX gold futures gained 0.9% and traded at USD 1,250.30/oz. In forex trading, the greenback eased against the euro, but moved higher against the British pound.
More than half of stocks advanced in the blue-chip gauge, with more than a 1% gain posted by AT&T, Bank of America, DuPont, JPMorgan and Merck. Conversely, the likes of 3M, Boeing, Cisco Systems and Intel lost more than 1% of their market value.
Research In Motion Ltd., a maker of the Blackberry smartphones, plunged 6% on comments made by analysts at Sanford C. Bernstein, revealing the company’s dim outlook compared to that of its peers.
Monsanto, a leading supplier of agricultural products and solutions, sank 5.8% after publishing forecasts for this fiscal year. The company expects its EPS at USD 2.45 vs. the earlier guidance of USD 2.60per share.
Saks, a retailer of luxury accessories and apparel, soared 20% on rumors the company could become a takeover target and was valued by a prospective buyer substantially above the last closing price.
The stock price of Lions Gate Entertainment Corporation, a Canadian entertainment company, advanced 10% on news the owner of the company’s 33% stake intends to raise his bid for the remaining shares from USD 6.50 to USD 7.50. As a result, Lions Gate ended the session at USD 7.14.
