US Market registers good gains
US Market started the day in a shaky manner today, Thursday, 10 July,
2008 but ended the day with good strong gains. Upbeat announcement from
a major retailer and encouraging economic data were the major reasons
for this turnaround. Energy sector was a major gainer today as crude
prices soared once again. Financials continued to be a major laggard.
After being in the red for almost the entire first half, The Dow Jones
industrial Average ended the day with a gain of 81.58 points at
11,229.02. The Nasdaq Composite Index, finished higher by 22.96 points
at 2,257.85. S&P 500 finished higher by 8.7 points at 1,253.39.
The early morning surprise came from Wal-Mart. The retailer reported
June same-store sales were up 5.8% thanks to bargain-hunting consumers.
In turn, Wal-Mart raised its second quarter earnings outlook also. This
gave the bulls a good reason to come to the forefront.
In
economic news, initial jobless claims for the week ending 5 July
totaled 346,000, which is below the 395,000 filings forecast. Weekly
claims decreased 58,000 from the prior week. The average of the last
two weeks is 375,000, which indicates the claims level was fairly
stable.
In the merger and acquisition arena, Dow Chemical
announced it is acquiring Rohm and Haas for $78.00 per share, which
represents a 74% premium to the previous session's closing price.
Dow component General Electric announced it is exploring options to shed its consumer and industrial unit.
Geo political tensions in Iran and Nigeria pushed up crude prices
today. Traders also continued to worry about slowing demand, continued
selling despite a sharp drop in U.S. inventories and rising tensions in
the Middle East. Crude rose by almost $6 at one shot today in the final
hour of trading after trading around $2 higher in the previous hours.
Crude-oil futures for light sweet crude for August delivery today
closed at $141.65/barrel (higher by $5.6/barrel or 4.1%) on the New
York Mercantile Exchange. Last week, prices gained $5.08 (3.6%).
At the currency markets on Thursday, the dollar lost previous gains as
shares on Wall Street came under more pressure from concerns over the
financial sector, with investors concerned over the fate of
government-sponsored mortgage buyers Fannie Mae and Freddie Mac. The
dollar index which measures the greenback against a trade-weighted
basked of currencies, fetched 72.51, compared with 72.76 in early
Thursday trade.
For tomorrow, the big item is General Electric's
second quarter earnings results. Economic data will be another area of
focus, with the release of June export and import prices, May trade
balance, July preliminary University of Michigan consumer sentiment,
and the June Treasury budget.
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