Investor sentiment was dampened yesterday following weak
earnings and a discouraging outcome to the ECB meeting, dragging
major indices into the red. Initial claims showed gradual signs
of improvement in the U.S. economy, but could not help indices
finish in the green. Among the top 10 S&P 500 groups,
material stocks were the biggest losers while consumer staples
sector emerged as the major gainer.
The Dow Jones Industrial Average (DJI) decreased 0.3% to close
the day at 13,944.05. The S&P 500 declined 0.2% to finish
yesterday's trading session at 1,509.39. The tech-laden Nasdaq
Composite Index lost 0.1% to end at 3,165.13. The fear-gauge CBOE
Volatility Index (VIX) increased 0.7% to settle at 13.50.
Consolidated volumes on the New York Stock Exchange, American
Stock Exchange and Nasdaq were roughly 6.6 billion shares, higher
than the daily average of 6.45 billion shares in 2012. Declining
stocks outnumbered the advancers on the NYSE. For 38% stocks that
advanced, 58% declined.
The Street began yesterday's trading session in a bearish mood
and the Dow lost as much as 134 points initially. But the index
recovered almost 100 points later in the day. Following the
European Central Bank policy meeting, ECB president Mario Dragi
said the Euro Zone will continue to struggle in the first half of
2013. "Later in 2013, economic activity should gradually recover,
supported by our accommodative monetary policy stance, the
improvement in financial markets confidence... as well as a
strengthening of global demand," he added. The ECB has maintained
its benchmark rate at a record low of 0.75%.
On the earnings front, shares of software and programming
giant Akamai Technologies, Inc. (NASDAQ:
) dropped 15.2% after the company's revenue came in below the
Street's expectations. Shares of Sprint Nextel Corporation (NYSE:
) dropped almost 0.5%. The company suffered a loss after its
customer-base in contract-based plans shrunk by 243,000. It also
had to bear an extra cost of $1.3 billion to upgrade its network
so as to more effectively compete with its rivals.
On a positive note, shares of DeVry Inc. (NYSE:
) surged 16.4% after earnings beat the Street's estimates. The
company grew profit via cost cutting and restructuring. Shares of
auto parts giant O'Reilly Automotive Inc (NASDAQ:
) surged 8% after its earnings beat the Street's estimates.
According to the U.S. Department of Labor, the number of
Americans filing for unemployment benefits decreased 5,000 to
366,000 from prior week's revised figure of 371,000. This was
above the consensus estimate of 363,000. Consequently, the
four-year moving average has decreased to its lowest level since
March 2008. Meanwhile, the Federal Reserve System said Consumer
Credit stepped up to 6.5% for the fourth quarter. Revolving
credit increased marginally by 0.1% while the Non-revolving
credit increased 9.4% for the same period.
Among the top 10 S&P 500 industry groups, consumer staples
sector was the larger gainer. The Consumer Staples SPDR (XLP)
increased 0.5%. Stocks such as The Coca-Cola Company (NYSE:
), Altria Group, Inc. (NYSE:
), Colgate-Palmolive Company (NYSE:
), General Mills, Inc. (NYSE:
) and PepsiCo, Inc. (NYSE:
) gained 1.6%, 1.4%, 0.4%, 0.3% and 0.1%, respectively.
The biggest loser among the S&P 500 industry groups was
the materials sector. The Materials SPDR (XLB) decreased 0.5%.
Stocks such as Nucor Corporation (NYSE:
), Ecolab Inc. (NYSE:
), Monsanto Company (NYSE:
), The Dow Chemical Company (NYSE:
) and Praxair, Inc. (NYSE:
) decreased 1.5%, 0.8%, 1.1%, 1% and 0.3%, respectively.
AKAMAI TECH (AKAM): Free Stock Analysis
COLGATE PALMOLI (CL): Free Stock Analysis
DOW CHEMICAL (DOW): Free Stock Analysis
DEVRY INC (DV): Free Stock Analysis Report
ECOLAB INC (ECL): Free Stock Analysis Report
GENL MILLS (GIS): Free Stock Analysis Report
COCA COLA CO (KO): Free Stock Analysis Report
ALTRIA GROUP (MO): Free Stock Analysis Report
MONSANTO CO-NEW (MON): Free Stock Analysis
NUCOR CORP (NUE): Free Stock Analysis Report
O REILLY AUTO (ORLY): Free Stock Analysis
PEPSICO INC (PEP): Free Stock Analysis Report
PRAXAIR INC (PX): Free Stock Analysis Report
SPRINT NEXTEL (S): Free Stock Analysis Report
To read this article on Zacks.com click here.