Here’s What Caused The Sharp Intraday Reversal Today
The
major indexes ended the session slightly lower as war news continued
to directly influence price action. While volatility was low for the day, a
rumor that the US would set its terror threat status to “red” sent prices down
sharply in the afternoon, though quickly shot up after the story was dispelled.
A “red” condition calls for all government buildings to close due to a clear
threat. Market breadth was mostly negative, though Nasdaq up volume beat down
volume with techs representing the strength of the day. Tomorrow the market will
get the final read on the nation’s fourth-quarter GDP which is expected to come
in at 1.4%. Usually final GDP numbers don’t surprise, as they have already been
revised, though the release is always a potential market mover.
The Dow Jones Industrial
Average
(
$INDU.X |
Quote |
Chart |
News |
PowerRating) closed -0.60% at 8,229.88. The S&P 500
(
$SPX.X |
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Chart |
News |
PowerRating)
closed -0.54% at 869.95. The Nasdaq
(
$COMPQ |
Quote |
Chart |
News |
PowerRating) closed -0.25% at
1,387.47.
The day’s biggest gainers were
Internet
(
$ECM.X |
Quote |
Chart |
News |
PowerRating), +2.12%, gold and silver
(
$XAU.X |
Quote |
Chart |
News |
PowerRating),
+0.67%, and healthcare providers
(
$RXH.X |
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Chart |
News |
PowerRating), +0.37%.
Biggest losers of the day were
forest and paper
(
$FPP.X |
Quote |
Chart |
News |
PowerRating), -2.60%, airlines
(
$XAL.X |
Quote |
Chart |
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PowerRating),
-1.38%, and natural gas
(
$XNG.X |
Quote |
Chart |
News |
PowerRating), -1.29%.
In economic news, durable
orders were down 1.2% vs. expectations of a 1.5% decline, and new home
sales were at 854K vs. expectations of 927K.
The Ten Year Note
(
TYH3 |
Quote |
Chart |
News |
PowerRating) was +060 at 113 235.
The US dollar
(
DXH3 |
Quote |
Chart |
News |
PowerRating) was -0.29 at 101.08.
Volume was average,
with the NYSE coming in at 1,279,666,000 and the Nasdaq at 1,397,343,000.
Market breadth was mostly
negative, with NYSE declining issues over advancing issues by a ratio of
1.28, and down volume over up volume by a 1.87 ratio. Nasdaq declining issues
over advancing issues came in at 1.24, and up volume beat down volume by a 1.44
ratio.
The
VIX was -0.50 at 32.16. The
TRIN was +0.92 at 1.45.
Biggest Dow decliners were:
Boeing
(
BA |
Quote |
Chart |
News |
PowerRating), -3.54% at 26.40, Alcoa
(
AA |
Quote |
Chart |
News |
PowerRating),
-2.57% at 20.78, International Paper
(
IP |
Quote |
Chart |
News |
PowerRating), -2.35% at 35.63,
International Business Machines
(
IBM |
Quote |
Chart |
News |
PowerRating), -2.27% at 81.55, Merck Co.
(
MRK |
Quote |
Chart |
News |
PowerRating), -1.85% at 54.47, and Caterpillar
(
CAT |
Quote |
Chart |
News |
PowerRating), -1.56% at 50.20.
Stocks in the news:
Conglomerate Temple Inland
(
TIN |
Quote |
Chart |
News |
PowerRating), -7.01% at 38.85, announced that it expects to earn less than
anticipated for the first-quarter with new estimates of for a loss of $0.30-0.40
per share due to higher energy costs, pension expenses and other charges.
Biomedical supply company
Medtronic
(
MDT |
Quote |
Chart |
News |
PowerRating), -2.54% at 45.90, has been downgraded by UBS Warburg to
“neutral” from “buy”.
Grocery chain operator Whole
Foods Market
(
WFMI |
Quote |
Chart |
News |
PowerRating), -1.80% at 57.06, received a downgrade fromÂ
Salomon Smith Barney to “in line” from “outperform”.
Biotechnology company Andrx
Company
(
ADRX |
Quote |
Chart |
News |
PowerRating), +14.38% at 11.53, rallied after UBS Warburg upgraded
the company to “buy” from “neutral” due to strong sales in the company’s generic
drug business.
Electric utilities company
Xcel Energy
(
XEL |
Quote |
Chart |
News |
PowerRating), ++8.29% at 12.92, moved higher after it was announced
it had agreed to settle a suit with creditors. The company will pay $752 million
over the next 13 months.
Software programming company
Network Associates
(
NET |
Quote |
Chart |
News |
PowerRating), -3.44% at 14.85, sold off after the company
postponed turning in its restated earnings to the SEC.
Computer retailer CDW
Computer Centers
(
CDWC |
Quote |
Chart |
News |
PowerRating), -1.76% at 42.87, has been downgraded by Morgan
Stanley to “equal-weight” from “overweight”.
Electronic retailer Radio
Shack
(
RSH |
Quote |
Chart |
News |
PowerRating), +1.44% at 21.13, has been upgraded by Prudential to “buy”
from “hold”.
Communications services
companies are likely to feel the effects of reduced estimates from Bear Stearns
as Bell South
(
BLS |
Quote |
Chart |
News |
PowerRating), +0.95% at 22.21, SBC Communications
(
SBC |
Quote |
Chart |
News |
PowerRating),
+1.32% at 21.43, and Verizon
(
VZ |
Quote |
Chart |
News |
PowerRating), -0.55% at 36.07, are believed by
the firm to struggle from increasing competition and not significantly
benefiting from economic recovery.Â
Retailer Sears Roebuck
(
S |
Quote |
Chart |
News |
PowerRating),
+12.54% at 24.14, is up nicely after announcing it may sell its credit card
business. The company holds the eight largest credit card business in the U.S.
valued at $30.8 billion in receivables.
Entertainment monster Walt
Disney
(
DIS |
Quote |
Chart |
News |
PowerRating), -0.33% at 17.63, has been added to CSFB’s Focus List.
Video retailer Best Buy
(
BBY |
Quote |
Chart |
News |
PowerRating), -3.09% at 29.43, has been downgraded by Bank of America to “neutral”
from “buy”.
Aerospace and defense company
Honeywell
(
HON |
Quote |
Chart |
News |
PowerRating), -0.75% at 22.31, has been downgraded by UBS to
“neutral” from “buy”.