Housing report and higher crude prices try to put a brake on stocks
US stocks registered small gains today after yield on the 10-year note continued to drop and crude prices remained above $69/bbl. It was mainly because of GE and IBM that Dow posted a modest gain.
Nineteen of the 30 Dow stocks closed higher for the day. The Dow Jones Industrial Average closed higher by 22.44 points at 13635.42. Nasdaq closed marginally up by 0.16 points to close at 2626.76. S&P 500 ended the day up by 2.65 points to close at 1533.7.
GE, IBM and Verizon were the major Dow winners today. GE shares soared a 5 year high to $39.29 (3.2% gain). GE accounted for 11 point gain of Dow while IBM’s 1.1% rise accounted for another 9 point gain of Dow.
Before market opened today, the Commerce Dept reported that starts of new U.S. homes fell by 2.1% to a seasonally adjusted annual pace of 1.47 million in May, as building permits for new construction rose 3% to 1.50 million on a jump in multifamily dwellings. The figures were slightly stronger than market expectations.
Best Buy misses Wall Street Expectations, shares slip 5.8%
When market opened in the morning, it was a sluggish start for the major indices which edged lower at the start of trading. After lingering around the flat line for most part of the day, Dow went up by almost 20 points in the final hour of trading, mainly led by GE.
The bond market, where prices have come under pressure and yields have spiked over the past couple of weeks, failed to react much to the latest housing news. The yield on 10 year Treasury notes finished at 5.08%.
Led by GE and the airline stocks, the industrials sector was the best-performing sector today. Conversely, consumer staples were the worst-performing.
Home-Depot shares today rose almost 1% after reports that it has agreed to sell its building supply unit for $10 billion.
Best Buy was a notable laggard today after coming up shy of second quarter earnings estimates and issuing full-year EPS guidance that fell below the consensus estimate. Best Buy shares slipped by almost 6%.
Eyes will be on retailers as Circuit City announces earnings report
Crude oil futures were steady today ahead of tomorrow’s weekly inventory report by Energy Department but still remained above the $69/bbl mark. But concerns still persisted about Nigerian unions planning a strike this week, threatening supplies from Africa's biggest oil producer. As per latest reports, the strike is going ahead tomorrow.
Crude-oil futures for light sweet crude for July delivery closed at $69.10/barrel (higher by $0.01/barrel or 0.01%) on the New York Mercantile Exchange. The contract touched $69.56 during intra day trading. Prices are down just 1% from a year ago.
Trading volumes showed 1.4 billion shares exchanging hands on the New York Stock Exchange and 1.9 billion trading on the Nasdaq stock market. Gaining issues topped decliners by 19 to 13 on the NYSE and by 15 to 13 on the Nasdaq.
Companies that are expected to report their earnings on tomorrow include Circuit City, Morgan Stanley and FedEx. The Energy Department's weekly oil report will hit the wires at 10:30 ET.