Blue Chip Rally
Despite yet more dreary outlooks from JDS Uniphase and Broadcom, stocks
managed to work their way higher Wednesday in a broad-based rally that lifted
most of the boats. Blue chips and banks led the Dow up a respectable 1.3% where
it is now perched back above its 50- and 200-day moving averages. The S&P
500 added 0.6%.
From its intraday low of last Thursday, the Nasdaq has bounced back by more
than 7%. Wednesday’s 0.9% gain marked the third straight winning day for the
Nasdaq.
Volume remained subdued, though, as 1.75 billion shares traded on the Nasdaq,
and 1.12 billion shares traded on the NYSE.
“With very little in the way of news items, I have to say that I was somewhat impressed with the
market. It seems like every time we started to drift, the buyers came out of the
woodwork, and I think that’s good news,” said Charles Payne, President, Wall Street
Strategies.
According to preliminary numbers, the Dow rose 138.38 to 10,729.60, the
Nasdaq lifted 19.47 to 2223.90, and the S&P 500 added 8.06 to 1261.86.
Top sectors were chemicals
(
$CEX.X |
Quote |
Chart |
News |
PowerRating), up 3.0%, oil services
(
$OSX.X |
Quote |
Chart |
News |
PowerRating),
up 3.0%, and banks
(
$BKX.X |
Quote |
Chart |
News |
PowerRating), up 2.8%.
Weakest sectors were health care
(
$HCX.X |
Quote |
Chart |
News |
PowerRating), down 2.6%, drugs
(
$DRG.X |
Quote |
Chart |
News |
PowerRating),
down 2.6%, and biotechnology
(
$BTK.X |
Quote |
Chart |
News |
PowerRating), down 2.9%.
The SOX
(
SOX.X |
Quote |
Chart |
News |
PowerRating), which had really been the tech area’s leadership of
late, edged down just slightly, but remains right on the edge of its 50-day.
One tech winner that broke above its base on heavier-than-average volume was
Intuit
(
INTU |
Quote |
Chart |
News |
PowerRating) which added 3 5/8 to 46 7/16.
Banks leading the way were Bank of America
(
BAC |
Quote |
Chart |
News |
PowerRating), up 4.9%, J.P. Morgan
(
JPM |
Quote |
Chart |
News |
PowerRating),
up 4.7%, Citigroup
(
C |
Quote |
Chart |
News |
PowerRating), up 3.7%, and Wells Fargo
(
WFC |
Quote |
Chart |
News |
PowerRating), up 3.5%.
Dow winners in addition to J.P. Morgan were Home Depot
(
HD |
Quote |
Chart |
News |
PowerRating), up 5.6%,
Caterpillar
(
CAT |
Quote |
Chart |
News |
PowerRating), up 5.1%, and Intel
(
INTC |
Quote |
Chart |
News |
PowerRating), up 4.6%.
Looking ahead, the weekly jobless claims will be released Thursday at 8:30 AM
ET, and analysts will be watching to see if it tops last week’s 372,000. But the
big report will be the employment numbers on Friday which some analysts feel
could be a catalyst for an inter-meeting Fed rate cut.