There's No Business Like FOX Business
The markets were mixed Tuesday afternoon as the Nasdaq Composite flatlined but the Dow looked to extend its six-day win streak and make new 14-month highs.
Today’s Markets
As of 1:47 p.m. EST, the Dow Jones Industrial Average rose 16.62 points, or 0.16%, to 10563.78, the Standard & Poor's 500 was up 0.29 points, or 0.03%, to 1128.07 and the Nasdaq Composite lost 1.52 points, or 0.06%, to 2289.62. The FOX 50 gained 0.63 points, or 0.08%, to 823.36.
Wall Street has taken a mostly upbeat stance following a pair of economic reports that showed U.S. home prices rose were basically flat in October and consumer confidence improved more than expected in December. Despite somewhat choppy trading, the markets have a chance to build on what has already been an impressive December and end at fresh 2009 highs.
Most of the Dow's 30 stocks were in the green, led by Walt Disney (DIS) and 3M (MMM). The index's biggest drags were Bank of America (BAC) and Chevron (CVX).
The Nasdaq Composite, which has been even hotter than its rival indexes, suffered slight losses. Some chip makers like Broadcom (BRCM) and Marvell Technology (MRVL) were under pressure.
Besides the new economic indicators, Tuesday is another quiet session with very low trading volume as portfolio managers look to lock in their big annual gains. At the same time, the markets are closed on Friday for New Year’s Day.
It shouldn’t come as a surprise to see the markets continue their hot streak this week as the Dow has climbed by an average of 0.95% during New Year’s week since 1900, compared to a gain of just 0.12% during all weeks over that span, according to Schaeffer’s Investment Research
Stocks hit session lows after the Conference Board said its confidence index jumped to a 52.9 reading in December, topping forecasts for a 52.5 reading and improving on November's upwardly revised 50.6 reading.A component measuring consumers' expectations jumped to a two-year high.
Wall Street had little reaction to the October S&P Case-Shiller home price index, which was essentially unchanged from the previous month. On an annual basis, home prices were down 7.3%, which was slightly worse than the 7.1% economists had forecasted.
In the commodity complex, oil's four-day winning streak was in doubt even as the dollar slumped. Crude was recently up 2 cents a barrel, or 0.04%, to $78.80. Gold didn't benefit from the currency action, slumping $10.20 a troy ounce, or 0.92%, to $1097.
Stocks reacted little to the Treasury Department's auction of $42 billion in five-year notes on Tuesday, which was better than Monday's less-than-stellar two-year note sale but still signaled tepid demand. The yield on the five-year auction was 2.665%, which was at the high end of the range, but the bid-to-cover ratio was stronger at 2.59.
Corporate Movers
Nokia (NOK) opened up a new front in its legal war with Apple (AAPL) as the phone maker requested an International Trade Commission investigation into the tech giant, accusing it of “building its business” on Nokia proprietary innovation. Nokia, which has been losing market share to Apple’s iPhone, accused Apple of infringing seven patents on “nearly all products” sold, including mobile phones, portable music players and computers.
American International Group (AIG) is poised to shell out millions of dollars in severance payments to its outgoing general counsel Anastasia Kelly, who resigned in protest of the U.S.’s pay restrictions, The Wall Street Journal reported. The giant insurer determined Kelly is entitled to the cash even though she has come under fire for her role in a pay dispute this month involving her and four other senior execs, the paper reported.
Morgan Stanley (MS) plans to overhaul its pay rules for senior executives that would benchmark compensation against rivals and defer more pay over time, the Journal reported. But Morgan’s reforms won’t likely go as far as ones put in place recently by Goldman Sachs (GS) as it still plans to allow 25% of exec compensation to be in cash for 2009, the paper reported.
Fannie Mae (FNM) extended its big gains from Monday after the mortgage giant said its loan portfolio shrunk last month by 2.5% from October and 26.1% on an annualized basis. However, Fannie, which is the largest U.S. home funding provider, said the serious delinquency rate on conventional single-family loans rose by 0.26 percentage points in October to 4.98%. A year earlier the rate was at just 1.89%.
Sterling Bancshares (SBIB) shelved plans to acquire First Banks’s deposits and bank branches. The banks said the move was a “mutual decision” and cited a longer-than-expected regulatory process.
Global Markets
European markets rallied for the fifth day in a row and ended at fresh 2009 highs. The U.K.'s FTSE 100 climbed 0.65% to 5437.61, France's CAC 40 gained 0.33% to 3959.98 and Germany's DAX rose 0.14% to 6011.55.
In Asia, Japan's Nikkei 225 rose 0.04% to 10638.06, Hong Kong's Hang Seng advanced 0.09% to 21499.44 and China's Shanghai Composite jumped 0.72% to 3211.76.
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