Stocks had a good run today. The Dow closed up about 84 points (0.72%); the S&P 500 Index was ahead by 11 points (0.90%) and the tech heavy NASDAQ gained 20 points (0.75%). The market breadth was favorable, as advancing issues beat out decliners by better than two-to-one on the NYSE. Moreover, essentially all the major market sectors closed in positive territory, driven by the energy, conglomerates, and basic material stocks. The financials also participated in the rally. The only group that ended with a loss was the transports.
Big gainers on the most active list today include tech leaders Micron (MU) and NVIDIA (NVDA). The major money banks also did well, with sizable gains in JPMorgan Chase (JPM - Free JPMorgan Chase Stock Report) and Citigroup (C). However, there were some big upside moves in the smaller issues, such as Zale (ZLC) and H.B. Fuller (FUL). While most stocks made gains, among the actively traded losers today were Las Vegas Sands (LVS) and Alcoa (AA - Free Alcoa Stock Report). There was also a sharp loss in LeapFrog Enterprises (LF).
The market likely got a bit of support from some favorable economic news. Although the export and import price data was not that eventful, the Federal Reserve’s beige book report was promising. The Fed hinted at a widespread recovery, helped by improving consumer spending and manufacturing. Nonetheless, the report indicated that the real estate sector remained a drag on the economy. Tomorrow, traders will, no doubt, be looking at the weekly initial and continuing claims data, the December producer price index (PPI), and the November trade balance report.
As was the case yesterday, the U.S. market got a lift from a decent showing overseas. The European markets closed out higher. The French CAC up over 2%, with similar strength on the German DAX. In London the FTSE logged a decent 0.61% gain, as well. The European markets found some encouragement from a successful bond auction in Portugal. The news, along with indications that Japan would be willing to purchase some European debt, helped reduce fears about further bailouts on the Continent. The euro strengthened against the U.S. dollar today, probably due to a better European financial outlook.
Elsewhere, commodities were generally strong today with gains in both oil and gold. This likely helped push related stock issues higher. Crude oil moved up to $91.75 per barrel for the February contract. The move may have had to do with a decent economic outlook, as well as a favorable inventory report released today. In Treasury markets, investors likely moved money from bonds to equities, lifting the yield on the 10-year note to 3.35% today.