US Market registers modest gains

Market gives more importance to weekly claims data than housing data

Despite a weak report on the housing sector and energy prices once again touching the $83/barrel mark, US stocks managed to close modestly up today, Thursday, 27 September, 2007. New home sales reached their lowest level in more than seven years. Eight of the ten sectors posted gains today. Utility and consumer discretionary were the only two sectors to post losses.

The Dow Jones industrial Average closed higher by 34.79 points at 13,912.94. The Nasdaq Composite Index, finished higher by 10.56 points at 2,709.59. S&P 500 finished higher by 5.96 points at 1,531.38.

Seventeen out of thirty Dow stocks ended in green today. Alcoa, Boeing, 3M and Caterpillar were the top Dow winners. GM, P&G, H-P, Merck and Mc Donalds were the Dow laggards.

Ahead of the opening bell, the Labor Department said first-time claims for jobless benefits last week fell to their lowest level since May.

The Commerce Department reported today that sale of new homes fell 8.3% in August and 21% from a year ago to a seasonally adjusted annual rate of 795,000, which is the worst level since June 2000.

Apple shares strike a new all time high

When market opened in the morning, stocks rallied right out of the gate.

Microsoft stock gave a boost to the market's opening after it was reported that its video game "Halo 3" generated $170 million during its first 24 hours, which makes it the most successful release in U.S. entertainment history.

Technology sector rallied getting a great boost. Apple shares helped the sector and the stock hit an all time new high today.

The Department of Labor's Initial Claims report said that for the week ended 22 September, jobless claims dropped to 298k versus the consensus estimate that was set at 320K. But the claims level remain well below normal recession levels.

The Commerce Department said U.S. economic growth accelerated in the second quarter to the fastest pace in more than a year. It was noted that GDP grew 3.8% in Q2 versus the prior read of 4.0%.

Median home sales price drop the greatest in 37 years

The housing report also stated that the median home sales price fell 7.5% to $225,700 in August from $242,627 last year - the biggest year-over-year drop in 37 years.

Crude oil prices soared today and were back at touching almost $83/bbl. Weak dollar, supply conditions and once again concerns regarding Iran’s nuclear policy took crude prices high.

Crude-oil futures for light sweet crude for November delivery closed at $82.88/barrel (higher by $2.58/barrel or 3.2%) on the New York Mercantile Exchange. Prices are up 32% from a year earlier.

On the New York Stock Exchange, trading volume neared 1.2 billion, with advancing stocks ahead of decliners 2 to 1, while more than 1.7 billion shares were exchanged on the Nasdaq, with advancing stocks outpacing decliners by 4 to 3.

For tomorrow, investors will once again embrace a number of economic reports. The Personal Income and Outlays report should provide a useful measure of consumer health amid a softened economic outlook. The Chicago Purchasing Managers Index will give a glimpse into business conditions in the Chicago area. The University of Michigan's Consumer Sentiment is due mid-morning at 10:00 ET.