By the time midday rolled around, the major market indexes had muscled into positive territory, as stocks bounced back from a shaky start to extend last week's impressive gains. A flood of housing data hits Wall Street this week, and hopes are high that further signs of improvement will be seen for the downtrodden sector. However, the first of these data points was mixed, at best. The NAHB/Wells Fargo housing market index showed that sentiment among homebuilders remained unchanged at its highest level since June 2007, but the results fell short of economists' expectations for a modest improvement. On the other hand, the bulls were encouraged after mega-cap tech stock Apple (AAPL) said it will disburse a regular quarterly dividend of $2.65 per share, and implement a three-year, $10-billion stock repurchasing program. With little else in the way of major market-moving news today, the S&P 500 Index (SPX) and Nasdaq Composite (COMP) both edged up to new multi-year peaks, while the Dow Jones Industrial Average (DJIA) managed to keep its head above breakeven.
The Dow Jones Industrial Average (DJIA – 13,239.13) took an up-and-down ride today, but eventually battled to a 6.5-point, or 0.05%, win. Seventeen of the Dow's 30 components settled higher, as American Express (AXP) paced the outperforming blue chips with a 1.3% uptick. Meanwhile, Bank of America (BAC) gave back some if its recent gains, leading the backpedaling minority with a 2.8% dip.
The S&P 500 Index (SPX – 1,409.75) touched the 1,414 mark after midday, reaching its highest price since May 2008. By the close, the SPX added 5.6 points, or 0.4%. Finally, the Nasdaq Composite (COMP – 3,078.32) bested its fellow benchmarks and tacked on 23.1 points, or 0.8%. In the later part of the session, the tech-rich COMP climbed to a more than 11-year peak of 3,087.10.
Turning to equities in focus, Domino's Pizza (DPZ) announced a special dividend for its shareholders ... A bullish brokerage nod pushed The Gap (GPS) to a two-year high ... The Nasdaq Stock Exchange slapped Diamond Foods (DMND) with a notice of noncompliance ... M&A news fueled options activity on United Parcel Service (UPS) ... Safeway (SWY) added $1 billion to its stock repurchasing program ... Shareholders might be accumulating protective puts on uptrending Target (TGT) ... and today's Quote of the Day comes from Andrew Rosenthal, editor of The New York Times op-ed page. The newspaper has garnered unfavorable attention following last week's published slam toward Goldman Sachs (GS) by an outgoing company executive. Defending the aim of an editorial page to Bloomberg, Rosenthal explained:
"The purpose of the op-ed page is to air an important position. We're saying, 'This is interesting,' and by the way, 'interesting' very often means it'll make you crazy."
But these weren't the only headlines hitting the Street today. Click on the links below for our blog coverage of:
And, in case you missed it, Senior Quantitative Analyst Rocky White compared the SPX's performance during four- and five-week options expiration cycles in the latest edition of Monday Morning Outlook. Click here to read Rocky's analysis.
For today's activity in crude oil, gold futures, options, and more, turn to page 2.
The Case for Big Moves in IWM and QQQ
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