Daily Market Summary 1/10/07

[Portfolio Crafter]

End of Day Market Summary Wednesday, January 10, 2007
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Stocks closed higher with investors looking past a sell-off in oil and commodities to focus on strength in the technology sector and Alcoa Inc.'s strong kick-off to the fourth-quarter earnings season. The general sentiment is that the market has overshot on the way down and would rebound strongly.

Today, the Dow Jones industrial average closed up 25.56 or 0.21% to 12,442.16, the broader S&P 500 index closed up 2.74 or 0.19% to 1,414.85, and the Nasdaq closed up 15.50 or 0.63% to 2,459.33.

Market breadth was positive. On the New York Stock Exchange, winners barely edged losers on volume of 1.56 billion shares. On the Nasdaq, advancers just edged decliners on volume of 2.30 billion shares.

The talk of the week is definitely oil and other commodities. Oil prices continued to erode - and continued to have a mixed impact on stocks. While lower oil and gas prices put more money into the hands of consumers, the can also can hurt oil company profits. Investors have also been a bit tentative ahead of the start of the first big wave of fourth-quarter earnings. While a few companies are due through the end of the week, most of the S&P 500 won't report results until later in the month.

Shares of Alcoa closed up $1.71 or 6% to $30.23, as it launched the reporting period, becoming the first Dow component to release results, as is traditional. It reported that fourth-quarter earnings increased by 60%, far outpacing big restructuring costs. Its net income rose to $359 million, or 41 cents a share, from $224 million, or 26 cents a share, in the year-ago period. Its revenue climbed 20% to $7.8 billion.

Stock of Apple closed up $4.43 or 4.8% to $97.00, as it continued to rally after announcing a new iPhone that allows users to play music and surf the Web on their cell phone. The device will be available in June and will retail for between $499 and $599.

Shares of US Airways closed up $1.03 or 3% to $58.93, after it increased its takeover bid for bankrupt Delta Air Lines by almost 20% to $10.2 billion. Delta's unsecured creditors would receive $5 billion in cash and 89.5 million shares of US Airways stock. It has set a deadline of Feb. 1 for its new offer to be endorsed by Delta's creditor's committee.

U.S. light crude oil prices for February delivery fell $1.62 to settle at $54.05 a barrel on the New York Mercantile Exchange. The inventory report brought out that supplies of crude stocks sank by 5 million barrels last week, but distillates and gasoline inventories rose by 5.4 million barrels.

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