Did Naz Pass Important Test?
Stocks snapped a three-day losing streak Wednesday and muscled their way
higher following fairly robust numbers in the housing sector. While the rally
was led by biotech and tech, there were strong showings in such diverse areas as
financials, consumer stocks, telecom, and oils. The broad-based rise left the
Nasdaq up 2.1% and the Dow and S&P 500 up 1.6% each.
For now, the Nasdaq managed to test and hold above the 2000 level as well as
its 50-day moving average. Traders will be watching for more confirming upside
volume in the days ahead.
New home sales for March came in at 1.02 million, which topped the 911,000
estimates, and existing home sales were 5.44 million, which topped the 5.14
million estimate. Both figures suggest that perhaps the turnaround in the
economy will be sooner rather than later.
Volume was moderate and about even with Tuesday’s levels as 1.96 billion
shares traded on the Nasdaq and 1.17 billion shares changed hands on the NYSE.
“Today’s kind of a decent day with a good tone to it. Obviously I think
we are going to be in a trading range for a little while. You had a big up week
last week. You’ve had some profit taking the last few days, and now I think
everyone is just digesting earnings and really looking toward the future and
what the economy looks like,” said Jay Suskind, Director of Trading, Ryan
Beck & Co.
“There seems to be the thought that maybe the economy starts to pick up
in the later spring or summer. I would sense that right now there’s no panic
buying or selling or doing anything. We’re just building a base here, which I
think long-term is healthy,” he added.
According to preliminary numbers, the Nasdaq added 43.01 to 2059.62, the Dow
gained 170.67 to 10,625.01, and the S&P 500 rose 19.22 to 1228.69.
Top sectors were biotechnology
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up 4.7%, semiconductors
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up 2.4%.
On the weak side were airlines
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silver
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America Online
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back above its 200-day moving average. AOL had been pulling back on lighter
volume over the past few days.
In biotech, Protein Design Labs
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and then added 5.15 or 10% to close at 55.99 on average volume.
Tech winners included Internet Security Systems
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43.85, Verisign
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to 80.60.
Disney
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better-than-expected earnings report. Disney rose on nearly double average
volume.
Joining Disney for the top spots in the Dow were Philip Morris
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5.7%, Honeywell
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Dow loser was AT&T
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Looking ahead, the employment cost index will be released Thursday at 8:30 AM
ET, and analysts look for a 0.9% increase.