US Markets end lower again

Indices plunge in the red in the final half hour registering modest losses

US Market once again ended in the red today, Wednesday, January 16, 2008 but today, the losses were modest. In fact it was quite a roller coaster ride for the market today. The indices were considerably up in the last thirty minutes before market were to close. But in the last twenty minutes, sell-off overpowered. Earnings reports from Intel and JP Morgan ruled the overall investor sentiment for the day. Six out of ten economic sectors ended in the red.

The Dow Jones industrial Average ended the day with a loss of 35 points at 12,466. The Nasdaq Composite Index, finished lower by 23 points at 2,394. S&P 500 finished lower by 7.75 points at 1,373. Sixteen out of thirty Dow stocks ended in the red today.

Before the opening bell, JP Morgan reported its earnings. Though the bank reported drop in its quarterly profits, it did not report loss, like many of its contemporaries. This pleased the investors and the stock ended almost 6% higher.

Technology sector witnessed immense sell off today after Intel disappointed investors with its earnings report after yesterday’s close. The shares of Intel dropped by almost 12% today. It took a toll on other technology stocks also. Oracle, Apple – all ended considerably lower today.

Fed’s Beige Book takes market up in spite of no new data

The Fed's Beige Book, which is largely an anecdotal review of the economy, was released today afternoon. Market did react positively though it did not contain new data and Dow was up by 112 points at one point of time. The report said residential real estate was "quite weak" in all regions, and further declines are expected in residential real estate lending.

On the economic front, December Consumer Producer Index (CPI) rose a slightly higher than expected 0.3%. The consensus estimate predicted CPI to rise 0.2%. Core CPI, which excludes volatile energy and food prices, rose an expected 0.2%.

December Industrial production was flat, which was slightly better than the expected 0.2% decline.

Crude prices fell by more than $1/barrel today. Price slipped after Energy Department reported that crude stockpiles rose more than expected for the first time in nine weeks. Crude-oil futures for light sweet crude for February delivery today closed at $90.84/barrel (lower by $1.06/barrel or 1.2%) on the New York Mercantile Exchange. Prices are 77% higher than a year ago.

As per the weekly inventory report by the EIA, U.S. crude inventories rose for the first time in nine weeks, up by 4.3 million barrels to 287.1 million barrels in the week ending 11 January. U.S. crude-oil imports averaged 10.4 million barrels a day last week, up 583,000 barrels a day from the previous week. U.S. refineries operated at 87.1% of their operable capacity last week, down from the previous week's 91.3%.

On the New York Stock Exchange, trading volume topped 2.1 billion shares, and advancing stocks edged just ahead of those declining. On the Nasdaq, 3.4 billion shares were exchanged, and advancers outran just ahead of decliners.

Investors will have lots of economic data to focus upon for tomorrow’s trading. December Housing Starts and Building Permits will be out before market opens followed by Initial claims data.