A volatile trading session ended with markets eking out small
gains propelled by a jump in Apple's shares and positive initial
claims data. Meanwhile, the impending government jobs report and
a focus on the Fiscal Cliff issue also played their part in the
markets' movement yesterday. Apple rebounded from the previous
day's losses and helped the technology sector to emerge as a
major gainer for the day.
The Dow Jones Industrial Average (DJI) gained 0.3% to finish
at 13,074.04. The Standard & Poor 500 (S&P 500) also
added 0.3% to close yesterday's trading session at 1,413.94. The
tech-laden Nasdaq Composite Index outperformed fellow benchmarks
to end 0.5% higher at 2,989.27. The fear-gauge CBOE Volatility
Index (VIX) added a paltry 0.7% to settle at 16.58. Total volumes
on the New York Stock Exchange stood at 3.23 billion shares.
Advancers edged past decliners on the NYSE; as for 51% stocks
that rose, 45% stocks closed lower.
The patient wait for a timely solution to the fiscal cliff
dilemma has been deciding benchmarks' direction for long. By now
all and sundry must be bored to hear repeatedly that economists'
have predicted another recession is looming if the issue is not
resolved by Congress. The Fiscal Cliff of $600 billion in tax
increases and spending cuts will take effect in few more weeks.
As for the latest development on this front, the negotiating
parties, namely President Obama and speaker of the House of
Representatives John Boehner, were reported to have made some
progress in solving the dilemma. The President and John Boehner
had a telephonic conversation, but none of them were ready to
divulge details. White House spokesman Jay Carney said: "Lines of
communication remain open". Boehner's spokesman Michael Steel
echoed these sentiments.
Apart from the cautious approach toward the Fiscal Cliff,
markets' gains were somewhat restricted by investors'
wait-and-watch attitude ahead of the government jobs report.
November employment data is scheduled for release on Friday and
till then investors are wary of betting big bucks. However, the
initial claims report on Thursday was positive and helped markets
add to their gains. According to the U.S. Department of Labor,
the advance figure for seasonally adjusted initial claims dropped
25,000 from the prior week to 370,000 in the week ending December
1. The drop was also wider than expectations of the figure coming
in at 380, 000.
Positive initial claims data came a day after Automatic Data
) National Employment report revealed that the U.S. private
sector added 118,000 jobs in November compared to 158,000 in
October. Job additions were also lesser than what the Street had
predicted. Positive initial claims data and not-so-favorable ADP
National Employment report mean investors will anxiously await
nonfarm payroll data.
Also helping markets move up was strong performance from the
technology sector. The Technology Select Sector SPDR (XLK) was up
0.6%, largely a result of gains for the likes of Apple Inc.
), Broadcom Corp. (NASDAQ:
) and Akamai Technologies, Inc. (NASDAQ:
). Apple gained 1.6% to rebound from the previous day's losses,
which was the largest drop in more than four years. Apple's CEO
Tim Cook said some portion of Mac's production will be shifted to
the U.S. Apple had slumped 6.4% after COR Clearing increased the
iPhone maker's margin requirement to 60% from 30%.
Separately, Broadcom gained 3.2% after projecting fourth
quarter revenue to be at the higher end of its target range.
Akamai jumped 10.0% after announcing its intention to sell
services in partnership with AT&T, Inc. (NYSE:
The utilities sector was a major loser among the S&P
industry groups and the Utilities Select Sector SPDR (XLU) lost
0.1%. Among the top ten holding companies of XLU, Duke Energy
), Dominion Resources, Inc. (NYSE:
), FirstEnergy Corp. (NYSE:
) and Exelon Corporation (NYSE:
) lost 0.5%, 0.4%, 1.1% and 0.3%, respectively.
APPLE INC (AAPL): Free Stock Analysis Report
AUTOMATIC DATA (ADP): Free Stock Analysis
AKAMAI TECH (AKAM): Free Stock Analysis
BROADCOM CORP-A (BRCM): Free Stock Analysis
DOMINION RES VA (D): Free Stock Analysis
DUKE ENERGY CP (DUK): Free Stock Analysis
EXELON CORP (EXC): Free Stock Analysis Report
FIRSTENERGY CP (FE): Free Stock Analysis
AT&T INC (T): Free Stock Analysis Report
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