Factory orders report try to boost US stocks

Indian ADRs ICICI Bank and Tata Motors slip considerably

US stocks changed in a mixed mode but almost near unchanged mark on Tuesday, 04 January 2011. Stocks started the day with mild gains. But stocks soon slipped in the red within an hour of trading. Better than expected factory orders data helped to pull the indices out from the red zone, but the same failed to climb to green. Ultimately, Dow managed to overcome the weakness and end the day with gains. Commodities witnesses a sharp drop in prices today as the dollar headed up.



For the day, that ended on Tuesday, 04 January 2011, Dow ended higher by 20.43 points (0.2%) at 11,691.2. Nasdaq ended lower by 10.3 points (0.4%) at 2,681.35. S&P 500 ended lower by 1.67 points (0.12%) at 1,270.2. Dow was trading lower by 30 points earlier in the day.

Six out of ten economic sectors ended lower led by consumer discretionary, energy and materials sectors. Telecom, utilities, healthcare, and technology sectors ended as the winners.

In the currency market on Tuesday, the dollar index, which weighs the strength of the dollar against a basket of six other currencies rose by 0.3%.

The Commerce Department in US reported on Tuesday, 04 January 2011 that U.S. factory orders jumped 0.7% in November to $423.9 billion, well ahead of the forecast for a 0.1% increase. Orders for October were also revised to show improvement. Orders in October fell 0.7% instead of the originally reported 0.9%. Excluding transportation, factory orders rose a sharper 2.4% in November. A steep drop in the sale of aircraft prevented factory orders from rising even higher.

The minutes from the Federal Reserve's last minutes were released an hour before settlement but did little to curtail the losses. The minutes showed the central bank saw signs the economic outlook was improving but decided it was not sufficient to make any adjustments to the bond-buying plan.

The telecommunications sector gained, as shares of Motorola Mobility Holdings rose 9.5% and Motorola Solutions gained 6.6% as Motorola's long-awaited split into two entities officially took place on Tuesday. Motorola Mobility consists of the company's consumer-focused smartphone and set-top-box business, while Motorola Solutions focuses on hand-held communication devices and public-safety radios.

The auto sales data for December hit the wires today. Ford reported that retail sales increased 17% from the prior year. Toyota Motor reported that its sales for December actually decreased by 2% year over year. Honda Motor said that its vehicle sales for December saw an increase of almost 26%. Nissan Motor reported a 28% increase in U.S. sales during December.

Crude prices ended drastically lower on Tuesday, 04 January 2011 at Nymex. Prices dropped as the dollar headed up. Crude prices slipped in tandem with other commodities on Tuesday. On Tuesday, crude oil futures for light sweet crude for January delivery closed lower by $2.17 (2.4%) at $89.38/barrel.

Precious metals ended considerably lower on Tuesday, 04 January 2011 at Comex. Prices fell as the dollar pared initial weakness and headed up and economic data showed that recovery is on track thereby decreasing the appeal of bullions as a an alternative investment.

On Tuesday, gold for February delivery fell by $44.1 (3.1%) ending at $1,378.8 an ounce on the New York Mercantile Exchange. It was biggest one day drop for gold in three weeks time. December Comex silver futures ended lower by $1.62 cents (5.2%) at $29.51.

Indian ADRs ended mostly lower on Tuesday. ICICI Bank and Tata Motors slipped the most losing 5.4% and 2.7% respectively.

For tomorrow, couple of earning and economic reports are expected for the day. The ADP Employment report is the main economic report expected.