Market Close Wrap-Up: Friday, September 3, 2010
by Andrea Kramer (akramer@sir-inc.com) 9/3/2010 4:20 PM
Stocks explored the black for a fourth straight session today, as the government’s highly anticipated employment figures were received with a collective sigh of relief. According to the Labor Department, nonfarm payrolls declined by 54,000 in August – much narrower than the 110,000 drop predicted by economists. Excluding census workers and other government employees, the private sector added 67,000 jobs last month, more than doubling forecasts for a gain of 30,000. Against this backdrop, the Street spent the session in celebration mode – in fact, not even a discouraging report on the services sector could rain on the bulls’ parade – with the major market indexes effectively halting a three-week losing streak.
“Another day, another better-than-expected economic report,” observed Senior Technical Strategist Ryan Detrick. “Let’s hope that the recent data can quiet the double-dip crowd, at least for a while,” he added. Looking ahead, Detrick notes that we’re “entering earnings warning season, but the next big driver for the market will be third-quarter earnings next month.”
The Dow Jones Industrial Average (DJIA – 10,447.93) finished near session highs today, adding 127.8 points, or 1.2%, by the closing bell. In fact, all of the Dow’s 30 blue chips settled north of breakeven, led by JPMorgan Chase (JPM) and Cisco Systems (CSCO). While the Dow’s intraday rally ran into resistance in the 10,450 region, the blue-chip barometer still managed to negate its year-to-date deficit, and settle the week atop its 20-week moving average for only the third time since late April. For the week, the Dow added 2.9%, and already boasts a month-to-date gain of 4.3%.
The S&P 500 Index (SPX – 1,104.51) ended with a gain of 14.4 points, or 1.3%, to settle atop the 1,100 level for the first time since Aug. 10. For the week, the broad-market index tacked on an impressive 3.8%, bringing its month-to-date advance to 5.3%. Not to be outdone, the Nasdaq Composite (COMP – 2,233.75) rallied 33.7 points, or 1.5%, toppling its 10-week moving average for the first time in a month. For the week, the tech-rich index gained 3.7%, extending its September lead to an impressive 5.7%.
Turning to equities in focus, call volume soared in the wake of Goldcorp’s (GG) recent acquisition announcement … Near-term options traders bet on an extended run higher for ReneSola Ltd. (SOL) … A slew of stocks rallied on hopes of being Dell Inc.’s (DELL) next takeover target … Micron Technology, Inc. (MU) was just one of three stocks slapped with a price-target reduction this morning … Google Inc. (GOOG) garnered the attention of a savvy spread strategist … and today’s Quote of the Day comes from Michael Boyd, president of consultant firm Boyd Group International Inc. Higher fuel and maintenance costs have rendered most 50-seat jets – once the pride of Delta Air Lines (DAL) – too expensive to fly, with more than 80 of the planes already scrapped in 2010. In fact, Boyd estimates that by 2015, domestic carriers will have only about 200 jets with 50 or fewer seats, down from roughly 1,200 today. However, if you expect Boyd to shed a tear for the soon-to-be scrapped fleet, you may be waiting a long time, as indicated by this statement to Bloomberg:
“The only people who love these 50-seaters are the chiropractors who have to fix what they do to peoples’ backs … The next stop is the Budweiser factory because that’s all they’re good for.”
But these weren’t the only headlines hitting the Street today. Click on the links below for our blog coverage of:
First Solar, Inc. (FSLR)
Alcoa Inc. (AA)
TrueBlue Inc. (TBI)
and Abercrombie & Fitch Co. (ANF)
And, in case you missed it, Sarah Wasserman examined the post-recall trends of Kellogg Company (K) in the latest installment of Sector Style. Click here to watch the video.
Crude futures slipped into the red today, as the potential threat from Hurricane Earl waned after the storm was downgraded to a Category 1 hurricane. In addition, black gold stumbled amid data pointing to slower-than-expected growth in the services sector last month, as indicated by a steeper-than-predicted dip in the Institute for Supply Management’s (ISM) purchasing managers index. By the close, October-dated crude oil futures gave back 42 cents, or 0.6%, to settle at $74.60 per barrel. For the week, the front-month contract surrendered 0.8%.
Meanwhile, gold futures pulled back from two-month highs as a stronger-than-anticipated jobs report diminished the metal’s safe-haven appeal. However, a weaker greenback helped to limit gold’s losses, with December-dated gold futures finishing on a deficit of $2.30, or 0.2%, at $1,251.10 an ounce. For the week, the front-month contract advanced 1% – gold’s fifth straight week-over-week increase.
Levels to Watch in Trading:
- Dow Jones Industrial Average (DJIA – 10,447.93) – support at 9,500; resistance at 12,000
- S&P 500 Index (SPX – 1,104.51) – support at 950; resistance at 1,300
- Nasdaq Composite (COMP – 2,233.75) – support at 1,900; resistance at 2,600
Good posts guys, i would have to agree to some extent.