US stocks register good gains in the final hour

All ten sectors end in the green led by the financial sector

After starting the day on a relatively shaky note, US stocks picked up momentum within a couple of hours on Tuesday, 17 March, 2009. The financial sector dropped substantially as soon as trading
kicked off today leading indices in the red region during the opening bell. But the same sector rebounded and coupled with support from a few large technology companies, US stocks managed a good rally at the end of the day. An unexpected good housing report also gave investors
some reason to cheer.

The Dow Jones Industrial Average ended higher by 178 points at 7,395, the Nasdaq closed higher by 58 points at 1,462 and the S&P 500 closed higher by 24 points at 778. Dow had started the day 23 points lower earlier during the day.

All the ten sectors ended in the green today led by financials and consumer discretionary sectors. Materials could not lend much support as aluminium giant Alcoa warned of a first quarter loss. Higher oil prices supported the energy sector.

Stocks stalled today in the first few minutes of trading due to the lack of direction and profit taking in the prior session. But despite a choppy start, stocks put together some solid gains as financial stocks rebounded to lift the broader market to fresh session highs.

Among major economic news at Wall Street today, the Commerce Department reported that February housing starts hit an annualized rate of 583,000, up from record lows and above the rate of 450,000 starts that was expected. Meanwhile, February building permits hit an annualized rate of 547,000, which is above the 500,000 that was expected. The prior reading showed 531,000 permits.

In a separate report, the Producer Price Index (PPI) for February increased 0.1% after a 0.8% increase the month before. The PPI was expected to increase 0.4% in February. Core PPI increased 0.2% after a 0.4% increase in the prior reading. The consensus called for a 0.1% increase in February.

Volatile crude shot up substantially today to highest level in three months on Tuesday, 17 March, 2009. Prices fell earlier today as traders digested the news that OPEC's meeting at Vienna this weekend was inconclusive regarding any further production cut. But then, the stronger than expected housing report from the Commerce Department helped boost prices.

On Tuesday, crude-oil futures for light sweet crude for April delivery closed at $49.16/barrel (higher by $1.81 or 3.8%) on the New York Mercantile Exchange. It rose to a high of $49.82 during intra day trading. Earlier during the day, prices dropped as much as 2%.

Tomorrow, among economic reports, February CPI and the fourth quarter account balance are due before the opening bell. In addition, the weekly crude inventory data is due at 10:30ET. The FOMC will make its policy announcement tomorrow at 14:15ET. The fed funds target rate is expected to remain unchanged at 0.00-0.25%.