Stocks End the Week in the Black, Despite Sequester Stalemate

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"The markets got off to a rough start, but managed to climb their way out of the trenches and finish in the green," observed Schaeffer's Senior Equity Analyst Joe Bell. The Dow Jones Industrial Average (DJI) dipped below 14,000 early on before the bulls retook control, helping the market cruise to modest gains for the day and the week.

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Although a new record high wasn't in the cards, it was a victorious day for the Dow Jones Industrial Average (DJI) , as it rebounded from an earlier loss to close up 35 points, or 0.3%, at 14,089.66 -- a 0.6% gain for the week. Eighteen of the Dow's 30 members finished higher, led by Wal-Mart Stores ( WMT ) and Walt Disney ( DIS ), which each added 1.4%. Bringing up the rear was Caterpillar (CAT), swallowing a 1.1% loss.

The S&P 500 Index (SPX) also closed higher, up 3.5 points, or 0.2%, at 1,518.20. The tech-rich Nasdaq Composite (COMP) added 9.6 points on the day, or 0.3%, to finish the week at 3,169.74. Since last Friday's close, the SPX is up 0.2% while the COMP has gained 0.3%.

The CBOE Market Volatility Index (VIX) suffered a modest pullback, shedding 0.2 point, or almost 1%, to settle at 15.36. For the week, the index added 8.4%.

CLOSING SUMMARY - INDICES

CLOSING SUMMARY - NYSE AND NASDAQ

A Trader's Take :

"Much of the intraday reversal followed a slew of mixed economic data early on," noted Bell. "The most positive report had to be the better-than-expected February ISM manufacturing index, which came in at its highest level since June 2011. Meanwhile," he continued, "we have finally reached the March 1 spending-cut deadline and it doesn't appear the world is going to come to an end. Although most people aren't expecting any sort of last-minute agreement tonight, the markets still churned higher."

3 Things to Know About Today's Market :

  • President Obama held a press conference, blaming Congressional Republicans for a failed compromise on automatic spending cuts that begin at midnight. The commander in chief warned that the "pain" felt from the so-called sequester "will be real." (Fox News)
  • Personal income dropped 3.6% in January , the steepest one-month decline in two decades. Consumer spending, meanwhile, edged up 0.2%. (ABC News)
  • David Einhorn has abandoned his lawsuit against Apple Inc. (AAPL). The hedge fund manager had been hoping to coerce the iPhone parent into issuing preferred stock, or otherwise sharing its cash among shareholders. (USA Today)

5 Stocks We Were Watching Today :

  1. Short-term Bank of America ( BAC ) option bulls bucked the trend .
  2. Weekly option buyers bet against Cisco Systems (CSCO).
  3. Ciena Corporation (CIEN) was targeted by call buyers ahead of next week's earnings report.
  4. Pandora Media (P) earned an upgrade after announcing a change to its free streaming music policy.
  5. A Yahoo! (YHOO) speculator rolled a covered call position up and out.

EARNINGS

For a look at today's options movers and commodities activity, head to page 2.

STOCKS - NOTABLE CALL ACTIVITY

STOCKS - NOTABLE PUT ACTIVITY

Commodities :

Broad economic concerns -- highlighted by disappointing manufacturing numbers from China -- sparked a sell-off in crude futures today. The April contract for oil lost $1.37, or 1.5%, to settle at $90.68 per barrel, another new year-to-date low. For the week, black gold gave back 2.6%.

Rising equities again had negative repercussions for gold futures, sending April-dated gold down $5.80, or 0.4%, at $1,572.30 per ounce, the lowest close for a front-month contract since mid-July. Week over week, gold was just fractionally below last Friday's settlement price of $1,572.80 an ounce.

SCHAEFFER'S MARKET POSTURE

At the end of every market day, the staff at Schaeffer's Investment Research reviews the trading day in detail, covering major events and key market developments. Don't miss this critical, timely and insightful report. If you enjoyed today's edition of Market Recap, sign up here for free daily delivery straight to your inbox.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

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This article appears in: Investing , Options

Referenced Stocks: BAC , DIS , FB , STZ , WMT

Schaeffer's Investment Research

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