Stock Market News for April 12, 2012 - Market News
April 12 2012 - 5:06AM
Zacks
Just a day after markets’ suffered
their biggest fall of the year, a single positive earnings report
reversed the benchmarks’ five-day losing streak on Wednesday.
Markets’ uptrend yesterday was also boosted by a fall in Spain’s
borrowing costs, a concern which had dealt serious injuries to the
markets over the last few days.
The Dow Jones Industrial Average
(DJI) gained 0.7% to close at 12,805.39. The Standard & Poor
500 (S&P 500) also jumped 0.7% and finished yesterday’s trading
session at 1,368.71. The tech-laden Nasdaq Composite Index moved up
0.8% and settled at 3,016.46. The fear-gauge CBOE Volatility Index
(VIX) also slipped from its path of a continuous uptrend, shedding
a meager 1.8% to close at 20.02. Consolidated volumes on New York
Stock Exchange, the American Stock Exchange and the Nasdaq remained
low at 6.31 billion shares, falling behind last year's daily
average of 7.84 billion. Advancing stocks on the NYSE stormed past
the decliners; as for 78% stocks that gained, only 20% stocks
traded lower. The remaining 2% stocks were left unchanged.
Yesterday’s bounce back was not
enough to negate all of the week’s losses and the Dow, S&P 500
and Nasdaq are still down 2%, 2.1%, and 2.1%, respectively, for the
week. Nonetheless, after investors were left distraught by the
negative trend of the benchmarks over the past five trading days,
any gains will help to buoy sentiment. The gains made yesterday not
only helped limit the week’s losses and end the losing streak, but
also lifted the Nasdaq back to its key level. Tuesday’s 1.8% loss
in the tech-laden index had dragged it below 3, 000, but the gains
made yesterday enabled it to remain 16 points ahead of the key
level. However, investors will have to wait for more positive
trends to see the blue-chip index and S&P 500 climb back to
their respective key levels of 13, 000 and 1, 400.
It was Alcoa, Inc.’s (NYSE:AA)
results that surprised the Street after it declared profits for the
quarter. The largest U.S. aluminum producer reported earnings per
share of $0.09, contrary to estimates of a loss of $0.04 per share.
Alcoa also bounced back to profits after it reported a loss of
$0.18 in the prior quarter. Alcoa, a bellwether in its domain, is
the first among the Dow components to report results, and is bound
to grab investors’ attention. This earnings report also
unofficially kick-starts the earnings season, and will surely help
the broader rally. Alcoa’s shares jumped 6.2% to lead the gains
among the 30 Dow components, followed by the likes of Cisco
Systems, Inc. (NASDAQ:CSCO), The Boeing Company (NYSE:BA), Intel
Corporation (NASDAQ:INTC), AT&T, Inc. (NYSE:T) and Verizon
Communications Inc. (NYSE:VZ), which jumped 2.4%, 1.7%, 1.5%, 1.1%
and 1.6%, respectively.
Additionally, Dow components and
financial behemoths, Bank of America Corporation (NYSE:BAC) and
JPMorgan Chase & Co. (NYSE:JPM) surged 3.8% and 2.4%,
respectively, following the broader rally in the financial sector.
The financial sector was one of the leading gainers among S&P’s
10 industry groups and the Financial Select Sector SPDR (XLF)
gained 1.6%. Among other financial shares, American Express Company
(NYSE:AXP), Citigroup, Inc. (NYSE:C), The Goldman Sachs Group, Inc.
(NYSE:GS), Morgan Stanley (NYSE:MS) and UBS AG (NYSE:UBS) gained
1.4%, 2.2%, 1.2%, 1.2% and 2.4%, respectively.
Separately, news from Europe was on
the positive side. Developments from the continent have
dampened investors’ mood since last week. In a sign of improved
confidence in the nation’s economic scenario, Spain's 10-year bond
yield dropped to 5.8% yesterday. For the moment, this was a
significant enough catalyst to boost investor sentiment as
investors are well aware of the consequences of surging borrowing
costs. Not long ago Ireland, Portugal and Greece suffered economic
turmoil with their borrowing costs reaching ‘unsustainable
levels’. Also helping to keep the positive sentiment alive
was European Central Bank’s Executive Board member Benoit Coeure’s
statement that the Securities Market Programme (SMP) that
authorized the ECB to buy euro-zone nations’ debt whenever needed
remained intact.
ALCOA INC (AA): Free Stock Analysis Report
AMER EXPRESS CO (AXP): Free Stock Analysis Report
BOEING CO (BA): Free Stock Analysis Report
BANK OF AMER CP (BAC): Free Stock Analysis Report
CITIGROUP INC (C): Free Stock Analysis Report
CISCO SYSTEMS (CSCO): Free Stock Analysis Report
GOLDMAN SACHS (GS): Free Stock Analysis Report
INTEL CORP (INTC): Free Stock Analysis Report
JPMORGAN CHASE (JPM): Free Stock Analysis Report
MORGAN STANLEY (MS): Free Stock Analysis Report
AT&T INC (T): Free Stock Analysis Report
UBS AG (UBS): Free Stock Analysis Report
VERIZON COMM (VZ): Free Stock Analysis Report
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