- U.S. Session Key Developments
- Commodities Fall on Dollar Strength
- Credit Protection Declines
US markets closed up approximately one percent while the NASDAQ composite index gained to 15-month high as technology outperformed following an upgrade to chipmaker Intel. News driving today's optimism proved minor with no key indicators on release except the Chcago Fed national activity index, which posted better than expected. Instead, drivers included optimistic growth projections for the UK and euro region, while M&A activity painted light on firm's fiscal health. Some major highlights included Sanofi-Aventis' announcement to acquire Chattem Inc. for $1.9B, while mining equipment maker Bucyrus will purchase the mining equipment division of Terex Corp for $1.3B. Alcoa's nearly $11B joint venture with a Saudi Arabian firm also lifted sentiment. Other trading, which would have a negative effect, included lower commodity prices as dollar strength remains near a three-month high. Crude remains above $70, while gold plummeted another $18, or 1.64%, to under $1100 per ounce. Ultimately, equities have performed strongly this year with gains of more than 40% in the NASDAQ. Performance next year promises to play on two significant trends. Weighing on both sides will be economic growth versus the Federal Reserve's eventual need to raise rates.
DJIA 30 10,414.14 +85.25 +0.83%
The Dow closed with the smallest gain of the five majors as five of thirty stocks fell while Basic Materials climbed 3.08%. Leading the index was aluminum producer Alcoa, up 7.89% on news of its joint venture with Ma'aden. Other leaders included Intel, up 2.5% following an upgrade to 'overweight' by Barclays, and a 2.32% rise in JPMorgan. As the index is largely filled with multinational firms, underperformance may be the result of dollar strength.
S&P 500 1,114.05 +11.58 +1.05%
The broader S&P500 index gained just over one percent as all sectors advanced while winners outpaced losers by more than 7:1. Leading today were raw material producers including Alcoa, up 7.89%, while AK Steel and US Steel each rose more than 6%. Of the ten largest firms, seven posted gains while losses in GE, P&G and J&J were minimal. Stocks have performed well this year, but the S&P500 has hardly moved since mid-November.
NASDAQ 2,237.66 +25.97 +1.17%
An upgrade to chipmaker Intel, and strength across the board, helped the NASDAQ outperform today and rally to a new 2009 high. At the same time, nearly a third of the 2755 securities tracked posted declines. Of the ten largest firms traded, none posted declines.
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