Reply #42: I'll catch the close for historical purposes - slow day all around, even [View All]

[54anickel]

the blather's been on the short side.

Dow 10,767.77 -10.81 (-0.10%)
Nasdaq 2,260.95 +4.22 (+0.19%)
S&P 500 1,260.43 +1.06 (+0.08%)
10-Yr Bond 4.547% +0.01
NYSE Volume 1,897,380,000
Nasdaq Volume 1,703,554,000

Close Dow -10.81 at 10767.77, S&P +1.06 at 1260.43, Nasdaq +4.22 at 2260.95: The market's major averages ceded opening gains mid-day, but recovered from session lows and closed around the flat line. The Dow was unable to join its counterparts on gaining ground, however, largely due to Merck's (MRK 28.41 -0.72) plunge following a mistrial in its latest Vioxx case. A round of upbeat corporate news, along with OPEC's decision to keep oil production at a 25-year high, sent the indices higher in early trading, but investors' cautious stance ahead of what is expected to be the Fed's 13th consecutive rate hike and jitters over its accompanying policy statement kept buying action in check. Alongside a 3.2% surge in the price of crude, and on account of merger activity, the Energy sector (+1.0%) led the session. Oil and gas exploration was the sector's best-performing industry, with Burlington Resources (BR 82.45 +6.36) serving as the muscle behind the advance. Reports that ConocoPhillips (COP 61.16 -1.91) is nearing a $30 billion acquisition of the company sent BR shares soaring, and reflected the recurring theme of consolidation within the sector. Despite the energy price uptick, Consumer Discretionary maintained positive footing throughout the day. Retailers were an especial bright spot, benefiting from Wal-Mart's (WMT 48.68 +0.60) reassuring reaffirmation of 2-4% same-store sales growth for December, which evidences solid holiday spending. Separately, Viacom (VIA-B 34.65 +0.24) lent further upside after announcing its bid for DreamWorks SKG that trumped General Electric's (GE 35.54 +0.01). The Consumer Staples sector (+0.2%), boosted by WMT, also closed higher. Technology wavered, but ultimately closed 0.2% higher on account of rising semiconductors and relative strength in Apple (AAPL 74.91 +0.58) following CSFB's raised price target and increased Q1 estimates. The Nasdaq outperformed the blue chip averages over the course of trading, further benefiting from rises in newly-added issues that include GOOG, EXPE, NVDA, ATVI, DISCA, and MNST. Healthcare also vacillated today, as MRK and relative weakness in HMOs challenged follow-through buying interest in Eli Lily (LLY 54.43 +1.02). Late-day recoveries in several pharmaceutical bellwethers helped pull the sector to the flat line, a move that contributed to the broader market's rise. Of the three declining sectors, Financial (-0.3%) weighed heaviest. While the sector also managed to somewhat pare its intra-day loss, its submerged state effectively capped the indices' advances. Selling pressure was broad-based, but banks served as particular sore spot and overshadowed strength in brokers. The Treasury market's negative stance served as a bearish backdrop for that sector, and the broader market, again today. Traders pushed the benchmark 10-year note (-07/32) to a 4.55% yield ahead of what is expected to be the Fed's 25 basis point increase in the Fed funds rate, to 4.25%, tomorrow. With respect to the accompanying policy statement, many participants anticipate a modification in language that may suggest an end to the current tightening cycle is near. We believe such a change is possible, but that it only provides the Fed an opportunity to cease raising rates. Inflation data will be the deciding factor; the CPI report, a well-followed inflation gauge, holds particular significance. The market awaits the November CPI data, which is due out on Thursday.NYSE Adv/Dec 1754/1552, Nasdaq Adv/Dec 1517/1550

3:25PM : At its best level of the afternoon, the Dow approaches positive turf as the closing bell draws near. Intel (INTC 26.69 +0.61) continues to lead the blue chip average, but respectable gains in Wal-Mart (WMT 48.71+0.63), Exxon Mobil (XOM 59.02 +0.52), Home Depot (HD 41.42 +0.40), Honeywell (HON 36.01 +0.30), and Boeing (BA 70.07 +0.42) help to further lift the Dow. The strongest challenger of those gains remains Merck (MRK 28.36 -0.77), which leads the lagging majority. NYSE Adv/Dec 1693/1603, Nasdaq Adv/Dec 1450/1600

3:00PM : Mixed footing amid the major indices persists -- all three have risen, but the Dow has not managed to clear the unchanged mark. The Treasury market, meanwhile, remains submerged. Trading volume has been relatively light, though, as many participants hold a cautionary stance ahead of tomorrow's anticipated 25 basis point rate hike, the accompanying policy statement that may feature a wording change, and the remainder of the week's economic data. The November retail sales report will be delivered tomorrow, followed by the latest trade balance on Wednesday. On Thursday's docket, the November CPI report sits center stage, as it's an inflation gauge that will factor into the Fed's future rate decisions. NYSE Adv/Dec 1667/1611, Nasdaq Adv/Dec 1446/1574