Celebrating the one-year anniversary of the end of the Great Recession's bear market, Wall Street closed slightly higher on Tuesday, adding onto the Dow's 4,000-point surge over that span.
Today's Markets
The Dow Jones Industrial Average rose 11.86 points, or 0.11%, to 10564.38, the Standard & Poor's 500 added 1.95 points, or 0.17%, to 1140.45 and the Nasdaq Composite picked up 8.47 points, or 0.36%, to 2340.68. The FOX 50 gained 3.71 points, or 0.45%, to 822.65.
Wall Street closed well off session highs as the Dow had been up more than 60 points earlier in the day on the strength of solid gains from tech stocks like Apple (AAPL) and the Nasdaq Composite, which closed at another 18-month high. While the rally lost some steam, the S&P 500 still posted its sixth win of the last seven days despite a lack of economic indicators to use for guidance.
“In the absence of any specific catalyst, the bias remains higher,” said Craig Peckham, equity trading strategist at Jefferies & Co.
The bias has been on the high side for much of the past year as the Dow posted its largest 52-week gain from a bear market low since 1933, surging more than 60% amid signs the worst of the crisis was over. Tuesday marked the one-year anniversary of the rebound from the meltdown caused by the Great Recession as the Dow tumbled to a 12-year low of 6547 on March 9, 2009. However, the blue chips remain roughly 3,600 points away from their all-time high of 14164, which was set on Oct. 9, 2007.
“The average investor is still on the sideline scared to heck -- as well as he should be -- because there is still a lot of uncertainty out there,” NYSE trader Ted Weisberg of Seaport Securities told FOX Business.
Most of the Dow's 30 components closed with a gain on Tuesday, led by United Technologies (UTX) and General Electric (GE). The index's worst performers were Merck (MRK) and Alcoa (AA).
Led by tech stocks like Nvidia (NVDA) and Electronic Arts (ERTS), the Nasdaq Composite posted stronger gains than the broader markets. The index has surged more than 84% since the March lows.
A day after the markets ended at a virtual standstill amid the second-lowest trading volume of the year, the New York Stock Exchange rebounded, posting volume of more than 1.1 billion.
“There’s a growing acceptance that the economy is doing better and equity investors for the most part are reluctant to sell stocks. A lack of sellers is creating a lack of volume,” said Michael James, senior equities trader at Wedbush Morgan Securities.
Aside from the tech rally, Wall Street was also boosted Tuesday by the currency markets as the U.S. dollar reversed course and fell modestly against the euro, allowing commodities to pare their losses. Crude oil fell 38 cents a barrel, or 0.46%, to $81.49. Gold sank $1.60 a troy ounce, or 0.14%, to $1122.
Corporate Movers
Citigroup’s (C) stock soared more than 7% despite a lack of corporate announcements. While the bank wouldn’t comment on the stock move, FBN’s Charles Gasparino reported the U.S. Treasury is talking to Wall Street investment bankers about unloading its 27% stake in Citi as early as the spring. At this price, it would give the U.S. a profit of more than $3.5 billion on its $25 billion investment.
Cisco Systems (CSCO) unveiled a new router that has 12 times the traffic capacity of the nearest competing system. The tech bellwether said the new router, CRS-3, triples the capacity of its predecessor and can transfer up to 322 terabits of data per second. The new system starts at $90,000 in the U.S.
Chevron (CVX) disclosed plans to slash 2,000 jobs this year as the energy giant looks to continue to slash costs by exiting markets and streamlining its operations. The energy giant sees first-quarter severance charges of $150 million to $200 million.
American International Group’s (AIG) climbed almost 13% but the insurer told the New York Stock Exchange it won’t comment on the unusual market activity.
Dick’s Sporting Goods (DKS) swung to a stronger-than-expected fourth-quarter profit of 56 cents a share thanks to a 10.7% rise in revenue to $1.3 billion. The company also forecasted 2010 EPS of $1.32 to $1.35, which would at least meet consensus calls from analysts for EPS of $1.32.
Kroger’s (KR) fourth-quarter profit of 39 cents a share easily beat the Street but the grocery store chain issued a disappointing outlook. The company sees 2010 EPS of $1.60 to $1.80, compared to analysts’ forecasts of $1.79. Kroger also posted fourth-quarter sales of $18.6 billion, up 7.2% from the year before and above estimates.
Ruby Tuesday (RT) said its same-restaurant sales 0.8% to 1% on an annual basis last quarter. The restaurant chain said severe weather during the quarter, including heavy snowfall in the Northeast, is estimated to have reduced the sales by 1.5% to 2%.
Global Markets
The U.K.'s FTSE 100 sank 0.08% to 5602.30, Germany's DAX lost 0.17% to 5885.89 and France's CAC 40 rose 0.17% to 3910.01.
In Asia, Japan's Nikkei 225 fell 0.17% to 10567.25 and Hong Kong's Hang Seng rose 0.05% to 21207.55.
List of problem banks growsRally Fizzles Amid Weak Volume
