Portfolio Crafter
10-16-2006, 09:01 PM
End of Day Market Summary Monday, 10/16/2006
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Stocks ended higher with the Dow Jones Industrial Average logging another record close as strong gains for Alcoa Inc, Exxon Mobil Corp. and Merck among others offset broker downgrades for General Electric Co. and Home Depot Inc. The Dow Jones industrial average came within three points of the 12,000 mark, and closed at a record high for the seventh time in the last 10 sessions. However, gains were modest as rising oil prices and trepidation ahead of a week packed with earnings and economic reports kept some investors on the sidelines.
Today, the Dow Jones Industrial Average closed up 20.09 or 0.17% to 11,980.60, and reached a record intraday high of 11,997.25. The broader S&P 500 index closed up 3.43 or 0.25% to 1,369.05, while the tech-laden Nasdaq composite closed up 6.55 or 0.28% to 2,363.84.
Market breadth was positive. On the New York Stock Exchange, winners beat losers nearly two to one on volume of 1.44 billion shares. On the Nasdaq, advancers topped decliners 19 to 10 on volume of 1.84 billion shares.
It is evident that the Dow is set to break through the 12,000 mark, barring any major bad news. The fact that a lot of people missed out on the recent rally, is leading to a sort of emotional stampede which has nothing to do with fundamentals. The point of discussion whether the economy is cooling off to quickly will continue as people are trying to figure out if growth is still happening. The market has everything going for it right now except the psychology. There could be lots of buying and selling if the Dow makes a strong push past 12,000, as hedge funds and money managers join mom and pop investors and try to profit from movement in either direction.
On the data front, the Empire State manufacturing survey showed that regional factory activity accelerated this month. The index rose to 22.9 in October from 13.8 in September. This is against the expected decline to about 12.6. It's the highest level since June. The report "points to decent underlying momentum in the New York factory sector.
Shares of General Electric fell 1.2% to $35.56 after Merrill Lynch downgraded the group to neutral from buy. While Merrill still sees double-digit profit growing in the next couple of years but calls the shares "essentially defensive."
Stock of Home Depot Inc. fell 1.5% to $36.35 after Goldman Sachs lowered its rating on the home-improvement retailer to neutral from buy, citing recent management departures. The broker prefers rival Lowe's Cos. which it upgraded to buy. Lowe's shares closed up 1.3% at $31.35.
Shares of Alcoa Inc. rose 2.6% to $27.32 after Prudential Equity Group upgraded the aluminum maker and its Canadian counterpart, Alcan Inc., to overweight from neutral. The broker raised its 2006 through 2009 aluminum-price targets, citing better-than-expected 5.5% demand growth for 2006 despite the soft auto climate, lower inventories, lower-than-expected interest rates and energy markets that may benefit 2007-08 global growth. Additionally, higher-than-previously-expected copper prices have also indirectly helped aluminum prices. Alcan shares closed up 3.9% at $42.79.
Stock of Merck & Co. rose 1.3% to $43.76, on news that it is expected to receive U.S. regulatory clearance as early as Monday for its breakthrough diabetes drug Januvia.
Shares of Mattel Inc. rose 2.9% to $21.30. The company reported third-quarter net rose 6%, bolstered by sales of Barbie. It reported a net income of $239 million, up from $225.3 million last year. Sales rose up 7% to $1.79 billion, against the expected $1.63 billion. Operating income for the latest quarter amounted to $322.2 million, up from $308.8 million a year earlier.
U.S. crude for light delivery gained $1.37 to settle at $59.94 a barrel on the New York Mercantile Exchange. OPEC announced that it would meet on Thursday to discuss ways to halt the slide in oil prices against the cartel's lowered forecast for 2006 world-oil demand.
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Stocks ended higher with the Dow Jones Industrial Average logging another record close as strong gains for Alcoa Inc, Exxon Mobil Corp. and Merck among others offset broker downgrades for General Electric Co. and Home Depot Inc. The Dow Jones industrial average came within three points of the 12,000 mark, and closed at a record high for the seventh time in the last 10 sessions. However, gains were modest as rising oil prices and trepidation ahead of a week packed with earnings and economic reports kept some investors on the sidelines.
Today, the Dow Jones Industrial Average closed up 20.09 or 0.17% to 11,980.60, and reached a record intraday high of 11,997.25. The broader S&P 500 index closed up 3.43 or 0.25% to 1,369.05, while the tech-laden Nasdaq composite closed up 6.55 or 0.28% to 2,363.84.
Market breadth was positive. On the New York Stock Exchange, winners beat losers nearly two to one on volume of 1.44 billion shares. On the Nasdaq, advancers topped decliners 19 to 10 on volume of 1.84 billion shares.
It is evident that the Dow is set to break through the 12,000 mark, barring any major bad news. The fact that a lot of people missed out on the recent rally, is leading to a sort of emotional stampede which has nothing to do with fundamentals. The point of discussion whether the economy is cooling off to quickly will continue as people are trying to figure out if growth is still happening. The market has everything going for it right now except the psychology. There could be lots of buying and selling if the Dow makes a strong push past 12,000, as hedge funds and money managers join mom and pop investors and try to profit from movement in either direction.
On the data front, the Empire State manufacturing survey showed that regional factory activity accelerated this month. The index rose to 22.9 in October from 13.8 in September. This is against the expected decline to about 12.6. It's the highest level since June. The report "points to decent underlying momentum in the New York factory sector.
Shares of General Electric fell 1.2% to $35.56 after Merrill Lynch downgraded the group to neutral from buy. While Merrill still sees double-digit profit growing in the next couple of years but calls the shares "essentially defensive."
Stock of Home Depot Inc. fell 1.5% to $36.35 after Goldman Sachs lowered its rating on the home-improvement retailer to neutral from buy, citing recent management departures. The broker prefers rival Lowe's Cos. which it upgraded to buy. Lowe's shares closed up 1.3% at $31.35.
Shares of Alcoa Inc. rose 2.6% to $27.32 after Prudential Equity Group upgraded the aluminum maker and its Canadian counterpart, Alcan Inc., to overweight from neutral. The broker raised its 2006 through 2009 aluminum-price targets, citing better-than-expected 5.5% demand growth for 2006 despite the soft auto climate, lower inventories, lower-than-expected interest rates and energy markets that may benefit 2007-08 global growth. Additionally, higher-than-previously-expected copper prices have also indirectly helped aluminum prices. Alcan shares closed up 3.9% at $42.79.
Stock of Merck & Co. rose 1.3% to $43.76, on news that it is expected to receive U.S. regulatory clearance as early as Monday for its breakthrough diabetes drug Januvia.
Shares of Mattel Inc. rose 2.9% to $21.30. The company reported third-quarter net rose 6%, bolstered by sales of Barbie. It reported a net income of $239 million, up from $225.3 million last year. Sales rose up 7% to $1.79 billion, against the expected $1.63 billion. Operating income for the latest quarter amounted to $322.2 million, up from $308.8 million a year earlier.
U.S. crude for light delivery gained $1.37 to settle at $59.94 a barrel on the New York Mercantile Exchange. OPEC announced that it would meet on Thursday to discuss ways to halt the slide in oil prices against the cartel's lowered forecast for 2006 world-oil demand.
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