Stock Market News for May 23, 2012 - Market News
May 23 2012 - 5:06AM
Zacks
Markets lost out on most of the
day’s gains to end mostly flat following reports that Greece was
considering exiting the euro. Benchmarks had been hovering at high
levels all day long after an economic reading from National
Association of Realtors buoyed sentiment. However, the final hour
brought back age-old Greek concerns to the forefront and markets’
gains largely evaporated. As for the sectors, financials showed
some strength while energy and materials were a drag on the
indices.
The Dow Jones Industrial Average
(DJI) edged down 0.01% to end just 1.67 points lower at 12,502.81.
The Standard & Poor 500 (S&P 500) moved up by a negligible
0.05% or 0.64 points to finish yesterday’s trading session at
1,316.63. The tech-laden Nasdaq Composite dropped 0.3% and ended at
2,839.08. The fear-gauge CBOE Volatility Index (VIX) gained 2.1%
and settled at 22.48. Consolidated volumes on the New York Stock
Exchange, Nasdaq and the American Stock Exchange were roughly 7.25
billion shares, somewhat lower than last year's daily average of
7.84 billion. The advancers and the decliners had a relatively thin
difference; as for 50% of the stocks that advanced on the NYSE, 47%
stocks closed lower.
Benchmarks enjoyed smooth sailing
almost through the entire trading session till the final hour.
Markets encountered a volatile period during the closing hour as
benchmarks dropped and again recouped most of their losses to end
on a flat note. The Dow had moved up to 12, 575.96 at a point and
in the final hours it lost out on all of its gains to hover around
50 points lower. Finally, a rebound at the final stage helped it to
close almost unchanged. The S&P 500 too had moved up by 12
points during the day, before losing almost all of these gains. It
was encouraging housing data that had lifted the mood earlier in
the day. However, Greek concerns returned to the markets to wash
away these gains later. Thus, markets failed to chalk up their
second straight day of gains.
The National Association of
Realtors reported an upside in existing-home sales in April, which
also was on a higher note on a year-on-year basis. According to the
report, total existing-home sales moved 3.4% higher to a seasonally
adjusted annual rate of 4.62 million in last month, up from a
downwardly revised 4.47 million reported in March. It also jumped a
significant 10.0% from April 2011’s level of 4.20 million. Lawrence
Yun, the chief economist of NAR, commented: “It is no longer just
the investors who are taking advantage of high affordability
conditions. A return of normal home buying for occupancy is
helping home sales across all price points, and now the recovery
appears to be extending to home prices”.
The housing sector was most likely
to benefit from this report and the PHLX Housing Sector (HGX)
jumped 1.3%. Among the housing stocks, Toll Brothers Inc.
(NYSE:TOL), Lennar Corp. (NYSE:LEN), PulteGroup, Inc. (NYSE:PHM)
and KB Home (NYSE:KBH) jumped 1.8%, 2.2%, 2.5% and 3.2%,
respectively. The financial sector also looked promising with The
Goldman Sachs Group, Inc. (NYSE:GS), JPMorgan Chase & Co.
(NYSE:JPM), Wells Fargo & Company (NYSE:WFC) and Bank of
America Corporation (NYSE:BAC) jumping 1.1%, 4.6%, 0.9% and 2.2%,
respectively.
However, reports of former Greek
Prime Minister Lucas Papademos telling Dow Jones Newswires that
Greece was preparing for an euro exit dampened the sentiment in the
final stages of the trading day. Concerns about Greece are not new
and benchmarks have suffered enough of a battering due to them.
Yesterday, the former prime minister said: "I share the view that
if Greece defaults and exits the euro, the consequences for the
euro zone—its financial system and real economy—will be profound
and the associated cost will be significant and far-reaching. It
will also affect the economies of other countries outside the euro
zone". Sounding a reminder over the catastrophic consequences of
such a decision, he said: "it cannot be excluded that preparations
are being made to contain the potential consequences of a Greek
euro exit".
The materials and energy sector
were a drag on the markets. While Energy Select Sector SPDR (XLE)
dropped 0.2%, the Materials Select Sector SPDR (XLB) was down 0.6%.
As for energy shares, Halliburton Company (NYSE:HAL), Transocean
Ltd. (NYSE:RIG) and Schlumberger Limited (NYSE:SLB) lost 1.3%, 0.9%
and 0.5%, respectively. Materials components including
Freeport-McMoRan Copper & Gold Inc. (NYSE:FCX), E. I. du Pont
de Nemours and Company (NYSE:DD) and Agrium Inc. (NYSE:AGU) were
down 1.3%, 0.6% and 1.7%, respectively.
AGRIUM INC (AGU): Free Stock Analysis Report
BANK OF AMER CP (BAC): Free Stock Analysis Report
DU PONT (EI) DE (DD): Free Stock Analysis Report
FREEPT MC COP-B (FCX): Free Stock Analysis Report
GOLDMAN SACHS (GS): Free Stock Analysis Report
HALLIBURTON CO (HAL): Free Stock Analysis Report
JPMORGAN CHASE (JPM): Free Stock Analysis Report
KB HOME (KBH): Free Stock Analysis Report
LENNAR CORP -A (LEN): Free Stock Analysis Report
PULTE GROUP ONC (PHM): Free Stock Analysis Report
TRANSOCEAN LTD (RIG): Free Stock Analysis Report
SCHLUMBERGER LT (SLB): Free Stock Analysis Report
TOLL BROTHERS (TOL): Free Stock Analysis Report
WELLS FARGO-NEW (WFC): Free Stock Analysis Report
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