After initially ticking lower at the open, the Street reversed course despite another gloomy report from the Labor Department. The most recent jobless figures revealed that first-time filings for unemployment hit a 26-year high during the week ended Jan. 31 an ominous figure heading into tomorrow's highly anticipated nonfarm payrolls report. However, instead of dwelling on the dismal data as well as nationalization concerns plaguing the financial industry investors celebrated stronger-than-expected January sales from retail titan Wal-Mart Stores (WMT). Also bolstering sentiment were credit card concerns Visa Inc. (V) and MasterCard (MA), both toppling analysts' earnings predictions.
After touching the 7,850 level in early trading, the Dow Jones Industrial Average (DJIA 8,063.07) did an about-face, boasting triple-digit gains by noon EST. Helping to fuel the index's turnaround were shares of Chevron (CVX) and Exxon Mobil (XOM), revving higher in parity with crude futures. Only 6 of the Dow's 30 components finished in the red, with shares of Disney (DIS) and Hewlett-Packard (HPQ) leading the laggards. By the closing bell, the blue-chip barometer added 106 points, or 1.34%.
The S&P 500 Index (SPX 845.84) powered 13.6 points, or 1.64% higher, powering through near-term resistance at its 20-day moving average. Finally, the Nasdaq Composite (COMP 1,546.24) tacked on 31 points, or 2.06%, and is now poised to close the week atop its 10-week moving average for only the third time since August 2008. Fueling the tech-rich index's gains were shares of Cisco Systems (CSCO), which surpassed the Street's earnings estimates.
Turning to equities in focus, Boeing (BA) announced another round of Dreamliner-related problems ... Pessimistic options players pummeled Starwood Hotels & Resorts (HOT) after a downgrade at Fitch ... Netflix (NFLX) fell victim to a bearish brokerage note, despite strong Xbox 360 participation ... Skepticism escalated toward The Coca-Cola Company (KO) ahead of earnings ... Alexander & Baldwin, Inc.'s (AXB) latest trip into the earnings confessional disappointed optimistic options players ... and today's Quote of the Day comes from actress Jane Fonda, who recently took up blogging. Gracing fans with her opinions regarding accused Ponzi schemer Bernie Madoff, Fonda so eloquently expressed her outrage:
"I've lost a lot, but it's nothing compared to friends of mine who have lost everything they had because every penny they saved over their lifetimes was invested in one of Madoff's schemes ... I want to shake him till his teeth fall out."
But these weren't the only headlines hitting the Street today. Click on the links below for our Daily Market Blog coverage of:
And, in case you missed it, Senior Equities Analyst Richard Sparks dissected the important elements of the market this week. Click here to watch.
For today's activity in crude oil, gold futures, options, and more, turn to page 2.
Rising expectations that the Organization of Petroleum Exporting Countries (OPEC) might further cut production gave oil futures a lift today. In December, the cartel agreed to reduce output by a record 2.2 million barrels per day beginning Jan. 1, 2009. By the closing bell, March-dated crude added 85 cents to end at $41.17 per barrel. Elsewhere, natural gas futures rose 7 cents to $4.67 per million British thermal units, after the Energy Information Administration (EIA) reported that inventories fell by 195 billion cubic feet during the past week.
Meanwhile, gold futures locked in their second consecutive gain today, bolstered by news from across the pond. The Bank of England slashed its key interest rate by half a percentage point to 1%, marking a record low. Meanwhile, the European Central Bank kept its lending rate unchanged at 2%, as expected. The central banks' decisions increased gold's appeal as a hedge against inflation, sending the February contract $12, or 1.3%, higher to end at $913.60 an ounce.
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