The equities market seesawed between positive and negative territory today, as investors digested a glut of news from Capitol Hill. Most notably, the Street sorted through President Obama's $75 billion plan to stabilize the housing market, which is expected to help roughly 9 million "at risk" homeowners refinance or modify their mortgages. Coincidentally, the details of the highly anticipated proposal came on the heels of the Commerce Department's latest report, which indicated that construction on new housing units plunged to a record low in January.
Meanwhile, the Federal Open Market Committee (FOMC) now expects the economy to shrink between 0.5% and 1.3% in 2009, according to the minutes of the policymakers' most recent meeting. The revised outlook is much gloomier than in October, when the FOMC had forecast growth of as much as 1.1% in 2009. What's more, the committee now predicts the unemployment rate will rise to 8.5% to 8.8% this year, and doesn't expect an economic turnaround to begin until the latter half of 2009.
After hovering around breakeven most of the day, the Dow Jones Industrial Average (DJIA 7,555.63) eventually settled with a paltry gain of 3 points, or 0.04%. Twelve of the index's 30 components muscled higher, led by Wal-Mart Stores (WMT) and Procter & Gamble (PG). Pacing the decliners was General Motors (GM), tumbling lower after releasing its recovery plan last night.
The S&P 500 Index (SPX 788.42) wasn't as fortunate as its blue-chip brethren, shedding 0.75 points, or 0.1%, to mark its second consecutive close beneath the 800 level. Finally, the Nasdaq Composite (COMP 1,468.0) followed the SPX's path into the red, with the tech-rich index slipping 2.7 points, or 0.18%.
Turning to equities in focus, the shares of Agilent Technologies (A) backpedaled, thanks to an earnings miss ... Sprint Nextel (S) challenged resistance in the 3 region ... Diana Shipping Inc. (DSX) faces a wall of skepticism ahead of earnings ... Pessimistic options players pummeled United States Steel (X), with put volume more than quadrupling the norm ... Front-month call volume surged on Silver Wheaton Corp. (SLW), as metal prices inched higher ... and today's Quote of the Day comes from Hamish Macdonald, an English reporter for Al Jazeera. When interviewing former Taliban official Mullah Abdul Salam Zaeef, the journalist was astonished when his subject confessed to an iPhone addiction. On his official blog, Macdonald eloquently captured his bewilderment, opining:
"I half expected him to log on and show us 'Taliban Twitter.'"
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, Joseph Hargett analyzed the prospects for online retailing specialist Amazon.com (AMZN). Click here to watch.
For today's activity in crude oil, gold futures, options, and more, turn to page 2.
After fluctuating between positive and negative territory, crude futures ended lower today. Oil for March delivery finished with a deficit of 31 cents, or 0.9%, at $34.62 per barrel, as investors placed their last-minute bets on the front-month contract, which expires Friday. Also pressuring crude lower were expectations that U.S. inventories rose for an eighth consecutive week; the Street will receive the latest report from the Energy Information Administration (EIA) tomorrow a day late due to the holiday-shortened week.
Gold futures continued their recent surge higher today, as the latest round of dismal economic news increased the metal's safe-haven appeal. Demand for the malleable metal surpassed $100 billion for the first time ever in 2008, skyrocketing 29% from a year earlier, the World Gold Council reported. After touching an intraday peak of $980 an ounce, February-dated gold ended with a gain of $10.70, or 1.1%, at $977.70 an ounce a new 7-month high.
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