A dull end for a bright day at Wall Street

Dow and S&P settle with minor losses but technology sector drags

A strong rally at Wall Street ran out of gas in the final hour of trading on Monday, 16 March, 2009. The financial sector was the sole market mover today. The sector had fuelled a strong rally earlier in the day but then it gave up all its gains pushing the indices back in the negative territory. Stocks would have ended higher for fifth straight day if not for the late hour sell-off.

After being up by more than 150 points earlier during the day, The Dow Jones Industrial Average ended lower by 7 points at 7,216, the Nasdaq closed lower by 28 points at 1,404 and the S&P 500 closed lower by 3 points at 753. Dow had started the day 65 points up earlier during the day

Market rallied earlier during the day after reports hit the wires that Barclays has made a good start for the year 2009. There were also reports that HSBC will not be requiring any more capital. These good news came in the back of the reports that other banks had been profitable in the first two months of the current year.

But the technology sector failed to display any sort of support to the market today. Even when Dow and S&P 500 were trading higher, Nasdaq failed to catch up with its counterparts.

Among major economic news at Wall Street today, the Commerce Department reported today that February industrial production declined 1.4%, reflecting a weak demand environment, which is essentially in-line with the consensus 1.3% decline. It was a slower rate of decline than the downwardly revised 1.9% decline registered in January. Capacity utilization dipped to 70.9% from 71.9%.

Over the weekend, Fed Chairman Bernanke said that the economy could recover by next year with support from lawmakers and the public. Bernanke also indicated an end to the crisis depends a lot on the financial system.

Hopes of global economic recovery and OPEC deciding to keep current production level sent crude prices higher today. Prices fell earlier today as traders digested the news that OPEC's meeting at Vienna this weekend was inconclusive regarding any further production cut. On Monday, crude-oil futures for light sweet crude for April delivery closed at $47.35/barrel (higher by $1.1 or 2.5%) on the New York Mercantile Exchange. Earlier during the day, prices dropped as much as 3%.

Tomorrow the main important economic reports expected are building permits and house starts and the PPI reports.