US stocks register gains

February registers much less than expected job losses

US stocks registered strong gains for the week that ended on Friday, 05 March, 2010. Several notable earnings reports and some economic data remained the headlines for the week. While trading volume remained comparatively low for the week, traders spent most of the time in anticipation of Friday's non-farm payroll data. Other than that, the dollar fluctuated as and when Greece came out with its plans regarding the steps it will undertake to control its fiscal deficit.

For the week, that ended on Friday, 05 March, 2010, Dow ended higher by 240.94 points (2.3%) at 10,566.2. Nasdaq ended higher by 88.09 points (3.9%) at 2326.35. S&P 500 gained 34.2 points (3.1%) at 1138.7. All ten economic sectors ended higher led by substantial gains in materials and consumer discretionary sectors.

During the week, the economic reports during the earlier part of the week were a bit disappointing in nature. Pending home sales for January fell 7.6% month-over-month. A 1% monthly increase had been expected. Also, ISM Manufacturing for February came in at 56.5, which was below the 57.9 consensus.

During the week, Greece attempted to quell concern over its fiscal health with the release of a new austerity plan that includes civil service salary cuts and a sales tax increase. Despite such plans, problems persist for Portugal and Spain. Meanwhile, both the European Central Bank and the Bank of England left their benchmark interest rates unchanged, as expected. Bank of England also kept its quantitative easing measures unchanged. The dollar index just gained 0.1% for the week.

The Fed's Beige Book, which is largely full of anecdotal economic news, came with little surprise during the week. It indicated that nine of the 12 Fed districts reported modest improvement in economic activity during February, while consumer spending improved slightly in many districts.

Among major corporate news during the week, an announcement came from Medivation and Pfizer regarding the failure of their Alzheimer's drug to meet primary or secondary endpoints.

On Friday, 05 March, 2010, a smaller-than-expected decline in February nonfarm payrolls provided participants with a reason to bid stocks broadly higher, but financials booked the best gains for the second straight session. Stocks spent the entire session in higher ground. Stocks remained volatile for most part of the day for the fluctuating dollar but ultimately stocks registered their fourth straight gains.

On that day, the Dow Jones Industrial Average ended higher by 122.06 points at 10,566.2. Nasdaq ended higher by 34.04 points at 2326.35. S&P 500 ended higher by 15.73 points at 1138.7. All ten economic sectors ended higher for the day led by financial, energy and consumer discretionary sectors.

Among key economic data for the day, the Labor Department in US reported on Friday that U.S. nonfarm payrolls declined for the 25th time in the past 26 months, falling by 36,000 in February to a seasonally adjusted 129.5 million. Market was expecting a figure around 68,000. The nation's jobless rate was steady at 9.7%. Job losses in February were concentrated in construction, schools, transportation, insurance, and publishing sectors.

In the currency market on Friday, the dollar gained ground initially but then slipped. The dollar index, which weighs the strength of the dollar against a basket of six other currencies initially went up by 0.4% but failed to sustain its gain and ended fractionally lower.

Crude prices ended higher on Friday, 05 March. Prices rose as the dollar fell against the euro increasing commodities' appeal against an alternate investment. The dollar fell due to stronger than expected job data. Better than expected non-farm payroll data also pushed crude prices higher on anticipation of higher demand in coming months. On Friday, crude-oil futures for light sweet crude for April delivery closed at $81.5/barrel (higher by $1.29 or 1.6%). Prices rose to a high of $82.12 during intra day trading. Prices gained 2% for the week.

Indian ADRs ended substantially higher on Friday. Tata Motors and ICICI Bank were the main gainers soaring 4.4% and 3.5% respectively.

For the year, Dow, Nasdaq and S&P 500 are higher by 1.3%, 2.5% and 2.1% respectively