Stock Market News for January 4, 2012 - Market News

By Zacks Equity Research,

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The first trading day of the year witnessed a positive trend in the US markets, backed by encouraging news from the global arena and positive domestic economic reports. Major indices gained during the trading day helped by an optimistic mood that prevailed among investors.

The Dow Jones Industrial average (DJIA) surged 1.5% to close at 12,397.38. The Standard & Poor 500 rose 1.6% to finish at 1,277.06. The Nasdaq composite index gained 1.7% to end at 2,648.72. The fear gauge CBOE volatility index closed lower at 22.98. On the New York Stock Exchange (NYSE), consolidated volumes were 3.9 billion. More than three stocks gained on the NYSE for every stock that declined.

To the investor's relief there was no discouraging news from the European front. In fact, data from Germany showed that average unemployment had fallen to its lowest point to its lowest in two decades. Furthermore, sound manufacturing data from China and India helped to boost investor sentiment.

A couple of domestic economic reports also helped markets and individual stocks to perform better. The U.S. economy showed signs of recovery, with the ISM manufacturing activity index for December hitting its highest point in the past six months. Manufacturing activity for December increased to 53.9 from 52.9 in November. Separately, a report from the U.S. Census Bureau of the Department of Commerce stated that: "Construction Spending during November 2011 was estimated at a seasonally adjusted annual rate of $807.1 billion, 1.2 percent (±1.6%)* above the revised October estimate of $797.4 billion. The November figure is 0.5 percent (±1.9%)* above the November 2010 estimate of $803.0 billion".

Coming to sectoral stocks, shares of banking and coal mining companies climbed higher on Tuesday's trade. Banking majors like Bank of America Corp. (NYSE: BAC ) Citigroup Inc. (NYSE: C ) , Goldman Sachs (NYSE: GS ) and Morgan Stanley (NYSE: MS ) advanced 4.3%, 7.7%, 5.5% and 6.3% respectively to close at $5.80, $28.33, $95.36 and $16.08 respectively. On the other hand, a federal court's decision to push back an EPA deadline for betterment of air quality in 27 states was welcomed by coal mining companies. Following the decision, share prices of Peabody Energy Corp. (NYSE: BTU ), Alpha Natural Resources (NYSE: ANR ), Patriot Coal Corp. (NYSE: PCX ) and Arch Coal Inc. (NYSE: ACI ) rose by $3.16, $1.64, $0.66 and $0.72 respectively

Moving to some individual stocks, shares of Rio Tinto (NYSE: RIO ) gained 6.9%, and construction equipment maker Caterpillar (NYSE: CAT ) settled after rising 3.9%. Shares of Cisco (NASDAQ: CSCO ) gained 3.4% after analysts at JP Morgan (NYSE: JPM ) upgraded the tech giant to overweight rating from neutral rating stating that increased spending by federal agencies will help the company's earnings prospects. Shares of another tech company, Apple (NASDAQ: AAPL ) gained 1.54% to close at $411.23. An analyst from Oppenheimer & Co. upgraded shares of networking-technology company Riverbed Technology Inc. (NASDAQ: RVBD ) from perform rating to outperform rating. Following the upgrade, shares of the company increased 5.15% to close at $24.71.



BANK OF AMER CP ( BAC ): Free Stock Analysis Report
PEABODY ENERGY ( BTU ): Free Stock Analysis Report
CITIGROUP INC ( C ): Free Stock Analysis Report
CATERPILLAR INC ( CAT ): Free Stock Analysis Report
GOLDMAN SACHS ( GS ): Free Stock Analysis Report
JPMORGAN CHASE (JPM): Free Stock Analysis Report
MORGAN STANLEY (MS): Free Stock Analysis Report
RIO TINTO-ADR (RIO): Free Stock Analysis Report
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Zacks Investment Research

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
Referenced Stocks: BAC , BTU , C , CAT , GS

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