Stock Market News for February 17, 2012 - Market News


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Greek developments receded into the background on Thursday as investors focused on encouraging domestic economic data which lifted the benchmarks to new highs for the year. Following encouraging data from both the jobs and housing market, the Dow rallied to its highest level since May 19, 2008. Moreover, all of the 10 industry groups in the Standard & Poor finished in the green.

The Dow Jones Industrial Average (DJI) recorded triple-digit gains, surging 123 points or 1% to finish the day at 12,904.08. The Standard & Poor 500 (S&P 500) jumped 1.1% and closed yesterday's trading session at 1,358.04. The tech-laden Nasdaq Composite Index settled at 2,959.85, rising 1.5% or 44 points. The fear-gauge CBOE Volatility Index slumped, losing 9.1% to finish at 19.22. Consolidated volumes on the New York Stock Exchange, NYSE Amex and Nasdaq, were roughly 7.33 billion shares, marginally than the daily average of 7 billion. On the NYSE, for every single stock that ended in the red, three stocks powered their way into positive territory.

With Thursday's robust gains, the benchmarks are now in the positive zone for the week. There is a day more to go for the week to conclude, and a decent trading session on Friday could help the markets end another week on a positive note. Till yesterday's close of trading, the Dow, S&P 500 and Nasdaq were up 0.8%, 1.2%, and 1.9%, respectively, for the week.

Investors have every reason to cheer the benchmarks' upward movement. Since early October last year, the Dow and Nasdaq are up 21% and 14%, respectively. The Nasdaq also recorded its best closing level since December 2000 and is just 40 points away from hitting 3, 000. As for the blue-chip index, it touched its highest point since May 19, 2008. Moreover, the Dow is precisely 95.92 points shy of touching 13, 000. With a few more robust sessions, the Dow will hit 13, 000 very soon and register new multi-year highs.

Only one of the 30 Dow components ended the day on the losing side. It was Kraft Foods Inc. (NYSE: KFT ) that lost 0.1% to end in the negative zone. Stocks like Alcoa Inc. (NYSE: AA ), American Express Company (NYSE: AXP ), Bank of America Corporation (NYSE: BAC ), E.I. du Pont de Nemours (NYSE: DD ), Hewlett-Packard Company (NYSE: HPQ ), JP Morgan Chase & Co. (NYSE: JPM ), Microsoft Corporation (NASDAQ: MSFT ) led the gains among all the other 29 gainers for the Dow and they were up 1.8%, 2.6%, 4.0%, 2.2%, 2.6%, 1.6% and 4.1%, respectively.

Financial stocks were among key winners for the Dow yesterday. Financials were among the best performing stocks and the Financial SPDR Select Sector Fund ( XLF ) surged 1.6%. Citigroup, Inc. (NYSE: C ), The Goldman Sachs Group, Inc. (NYSE: GS ), Morgan Stanley (NYSE: MS ) and UBS AG (NYSE: UBS ) were the other financial stocks that posted gains, and they increased 3.1%, 1.4%, 1.2% and 3.4%, respectively.

Materials was the other sector that clocked up robust gains among the 10 industry groups of the S&P. The Materials Select Sector SPDR ( XLB ) surged 1.8% and stocks such as AK Steel Holding (NYSE: AKS ), Nucor Corporation (NYSE: NUE ), Freeport-McMoRan Copper & Gold, (NYSE: FCX ), Potash Corporation (NYSE: POT ) gained 2.4%, 2.3%, 3.4% and 2.4%, respectively.

Coming to economic data, both the jobs and housing market had positives to share with the investors. The U.S. Department of Labor reported another drop in initial claims, painting a rosy picture of declining unemployment. The data suggests that the advance figure for seasonally adjusted initial claims was 348,000, for the week ending February 11, declining 13,000 from the previous week's revised figure of 361,000. Consensus estimates had predicted initial claims to come in at 363,000.

Meanwhile, according to a joint release from the U.S. Census Bureau and the Department of Housing and Urban Development, single-family housing starts in January came in at 508,000, dropping 1.0% from December's revised figure. However, both building permits and housing starts reflected encouraging trends, lifting the broader sentiment. According to the report, privately-owned housing units authorized by building permits in January increased 0.7% from December to a seasonally adjusted annual rate of 676,000. As for the housing starts, the report suggested: "Privately-owned housing starts in January were at a seasonally adjusted annual rate of 699,000. This is 1.5 percent (±16.8%)* above the revised December estimate of 689,000 and is 9.9 percent (±14.2%)* above the January 2011 rate of 636,000".

Investors chose to focus on domestic data, and largely ignored cross-Atlantic developments. However, the latest from Greece is that the nation hopes to get is bond-swap deal approved early next week. Positive news from the European region meant that financial stocks received a fillip and this development also contributed somewhat towards the broader rally.

ALCOA INC ( AA ): Free Stock Analysis Report
AK STEEL HLDG ( AKS ): Free Stock Analysis Report
AMER EXPRESS CO ( AXP ): Free Stock Analysis Report
BANK OF AMER CP (BAC): Free Stock Analysis Report
DU PONT (EI) DE (DD): Free Stock Analysis Report
FREEPT MC COP-B (FCX): Free Stock Analysis Report
GOLDMAN SACHS (GS): Free Stock Analysis Report
HEWLETT PACKARD (HPQ): Free Stock Analysis Report
JPMORGAN CHASE (JPM): Free Stock Analysis Report
KRAFT FOODS INC (KFT): Free Stock Analysis Report
MORGAN STANLEY (MS): Free Stock Analysis Report
MICROSOFT CORP (MSFT): Free Stock Analysis Report
NUCOR CORP (NUE): Free Stock Analysis Report
POTASH SASK (POT): Free Stock Analysis Report
UBS AG (UBS): Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , US Markets
More Headlines for: AA , AKS , AXP , XLB , XLF

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