US stocks end February with good gains

Economic data and crude price pull up stocks

US stocks ended with good gains on Monday, 28 March 2011. Nasdaq also joined the other two major indices to end in the green after staying in the red for most part. Better than expected economic data took stocks higher today. Crude prices paring earlier gains and slipping modestly lower also added to the momentum.



For the day, that ended on Monday, 28 February 2011, Dow ended higher by 95.89 points (0.8%) at 12,226.34. Nasdaq ended higher by 1.22 points (0.04%) at 2,782.87. S&P 500 ended higher by 7.34 points (0.6%) at 1,327.22. For the month of February 2011, Dow, Nasdaq and S&P 500 gained 2.8%, 3% and 3.2% respectively.

All ten economic sectors ended higher led by telecom, utilities, materials, and healthcare sectors.

Among economic data expected for the day, Commerce Department reported today that January personal income increased by 1.0%, which is stronger than the 0.3% increase that had been expected. However, January personal spending increased just 0.2%, which is less than the widely anticipated increase of 0.4%. Core personal consumption expenditures for January increased just 0.1% month over month, but that had been broadly expected.

Separate data showed that The Chicago PMI for February climbed to a 20-year high of 71.2. It had been expected to come in at 67.5.

Additionally, housing report hit the wires today which showed that pending home sales for January fell 2.8% month over month, but that is still better than the 3.2% decline that had been expected.

Amazon.com, downgraded by analysts, was the heaviest drag on the Nasdaq. Semiconductor stocks also adversely affected the tech-rich Nasdaq. Intel had also been a source of weakness for the Nasdaq.

Crude prices ended little lower on Monday, 28 February 2011 at Nymex. Prices went up initially due to the low dollar but then pared its gains as traders mulled over the fact that recent surge in crude price was overdone. Prices also dropped on reports that Saudi countries were increasing production to offset the loss from Libya.

On Monday, crude oil futures for light sweet crude for April delivery closed lower by $0.91 (0.9%) at $96.97/barrel. Prices reached a high of $99.96 during intra day trading.

In the currency market on Monday, the dollar index, which weighs the strength of the dollar against a basket of six other currencies, pared initial gains and dropped by 0.3%. The index lost 1% in February 2011 and is down by 2.5% on a y-t-d basis.

Precious metals stayed at high levels on Monday, 28 February 2011 at Comex. Geo-political tensions kept prices at these levels. Gold ended almost flat while silver gained. The low dollar pushed up prices today. On Monday, gold for April delivery ended higher by $0.60 (0.05%) at $1,409.9 mark on the New York Mercantile Exchange. Prices rose to a high of $1,417 during intra day trading. March Comex silver futures ended higher by $0.90 (2.7%) at $33.82.

Traders kept a close eye on the clashes in the Mid East region. The revolt in Libya is the latest in a spate of political uprisings across the Mideast and North Africa in recent weeks.

For every two stocks that fell, three gained on the New York Stock Exchange, where volume topped 1.2 billion shares. Composite volume came to 4.3 billion.

Indian ADRs ended mixed on Monday. Tata Motors and HDFC Bank were the main gainers soaring 1% and 0.8% respectively. VSNL and ICICI Bank shed 3.2% and 1.7% respectively.

For tomorrow, no economic report is expected. Few earning reports are expected though.