After the major market indices spent most of the session flirting with minor-league losses, the Federal Reserve hit a home run in afternoon trading. Following the conclusion of the Federal Open Market Committee's (FOMC) 2-day meeting, the central bank announced plans to buy up billions of dollars in longer-term Treasurys and mortgage-related debt. The Fed's surprise move is widely expected to lower interest rates for most borrowers, and should "contribute to a gradual resumption of sustainable economic growth," the committee's statement indicated. The news overshadowed big-name buyout buzz and the Street soap opera that is American International Group (AIG), catapulting most stocks into positive territory.
The Dow Jones Industrial Average (DJIA 7,486.58) stuttered lower right out of the gate this morning, but ended with a gain of 91 points, or 1.23%, thanks to the Fed's commitment to purchase Treasurys. Seven of the Dow's 30 blue chips finished in the red, with shares of Kraft (KFT) leading the laggards. Pacing the advancing issues were financial concerns Citigroup (C), Bank of America (BAC), and JPMorgan Chase (JPM).
The S&P 500 Index (SPX 794.35) also dashed higher following the FOMC announcement, reversing early losses to settle 16 points, or 2.09%, ahead. Echoing the trend was the Nasdaq Composite (COMP 1,491.22), adding 29 points, or 1.99%. The tech-rich indicator is now challenging resistance at its 20-week moving average, which has led the index lower since August 2008.
Turning to equities in focus, Hudson City Bancorp, Inc.'s (HCBK) CEO said the financial firm doesn't "anticipate needing help from the federal government at any time" ... Coca-Cola Co.'s (KO) $2.4 billion bid to buy China Huiyuan Juice Group was rejected by the Chinese government ... The Chubb Corporation (CB) attracted optimistic options players, as a group of insurers confronted Capitol Hill ... Bullish bettors also bombarded Consolidated Edison (ED), on the heels of an upgrade at Jefferies ... Shares of Superior Energy Services (SPN) could find themselves in dangerous territory ... and today's Quote of the Day comes courtesy of President Barack Obama. While most red-blooded Americans have filled out an NCAA tournament bracket (or 4...), the Commander in Chief is no exception, making his picks with ESPN reporter Andy Katz yesterday. However, considering the president will be at a NATO summit in France during the start of Final Four weekend, how will the leader of the free world tune in? Without missing a beat, the Tar Heels fan answered:
"Air Force One does have DirecTV."
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 retail titan Nordstrom Inc. (JWN). Click here to watch the video.
For today's activity in crude oil, gold futures, options, and more, turn to page 2.
Oil futures ended lower today, thanks to a surplus in gasoline and crude inventories. The Energy Information Administration this morning said that gasoline stockpiles increased by 3.2 million barrels in the week ended March 13, surpassing economists' predictions for a decline of 2.1 million barrels. Meanwhile, crude inventories increased by 2 million barrels, matching economists' predictions. After dipping to an intraday low of $46.92 per barrel, April-dated oil finished with a loss of $1.14 at $48.14 per barrel.
Gold futures continued their recent journey into the red today, falling for the third consecutive session. The precious metal's safe-haven appeal further diminished as the equities market reversed course in afternoon trading. Against this backdrop, gold for April delivery shed $27.70, or 3%, breaching the $900 level to end at $889.10 an ounce the lowest closing price for a front-month contract in 2 months.
Levels to Watch in Trading:
A bull? A bear? Conservative? Aggressive? No matter what kind of investor you are, option trading offers you tools to enhance and protect your portfolio. Learn how from Bernie Schaeffer, the highly respected equities and option market veteran. Bernie's home study course will show you how to leverage relatively small amounts of capital into big profits -- in just 10 days. Includes CD, DVD, and other extras. Click here to learn more.
Discuss this article:
Post your own comment
More articles:
Due to the diversity available to options traders, investors have many paths toward achieving a profit. For a bearish trader, the simplest path is to buy (to open) a put contract. By doing so, the trader is placing a bet that the underlying stock will trade significantly below the option's strike price by that contract's expiration date. This strategy is pretty straightforward, but it fails to take into account the potential complexities involved in positioning your portfolio to profit from stocks that are not in a clearly defined downtrend. What's more, due to the size of the drop needed in the underlying security, an outright put purchase often rules out stocks that have additional downside potential, but which could stall near technical support levels. read more...
McDonald's Corp (MCD: sentiment, chart, options) is in the news this morning as the company announced a 2.6% increase in January sales at restaurants open at least 13 months. Same-store sales in the closely watched U.S. region fell 0.7%, while those in Europe and in the Asia/Pacific, Middle East and Africa region both rose 4.3%. read more...
Bristol-Myers Squibb (BMY) read more...
Option traders are betting on a continued slump for casino concern Bally Technologies Inc. (BYI: sentiment, chart, options) , despite an upbeat analyst endorsement over the weekend. read more...
Aetna Inc. (AET) read more...
Research In Motion Limited (RIMM: sentiment, chart, options) has attracted an unusual amount of attention from option traders today especially on the put side of the tape. In early afternoon activity, the BlackBerry maker has seen roughly 17,000 puts change hands, already surpassing the stock's expected single-session volume of about 15,000 puts. read more...
Earnings season is upon us, and investors all across Wall Street are hoping to take advantage of these potentially volatile few weeks. Large bull (and bear) gaps, upgrades and downgrades, and short squeezes all become increasingly more likely during this period, as companies meet, beat, or miss quarterly expectations. As such, it is imperative that traders be well equipped to deal with all of the eventualities. read more...
NRG Energy (NRG) read more...
Bullish call spreads are known by a variety of different names among options traders. But whether the position is a bull call spread, bullish debit spread, or a long vertical call spread, it is still constructed by purchasing an at-the-money or in-the-money call while simultaneously selling an out-of-the-money call. The reasoning behind pairing up these seemingly contradictory options is really quite simple: limited risk. read more...
McDonald's Corp. (MCD) read more...
Today's Most Popular Stories
working... 
