Advertising

The Seattle Times Company

NWjobs | NWautos | NWhomes | NWsource | Free Classifieds | seattletimes.com

Business / Technology


Our network sites seattletimes.com | Advanced

Originally published Wednesday, January 13, 2010 at 4:15 AM

Comments (0)     E-mail E-mail article      Print Print      Share Share

Market advances as financials, pharma rebounds

The stock market closed higher Wednesday, led by gains in shares of banks and drugmakers, while energy companies were held back by a drop in crude oil.

AP Business Writer

S&P 500 index intraday trading


Biggest Puget Sound companies

The chart below reflects the stock price and the dollar change.


advertising

NEW YORK —

The stock market closed higher Wednesday, led by gains in shares of banks and drugmakers, while energy companies were held back by a drop in crude oil.

The Dow Jones industrial average closed up 53 points after trading above 10,700 for the first time in 15 months. Broader indicators also advanced. Treasury prices fell, pushing interest rates higher, after jumping on Tuesday.

Financial stocks led the rally as the appearance of leading bank CEOs on Capitol Hill turned out to be less fractious than expected. The bankers endured scolding from lawmakers and acknowledged making missteps during the financial crisis.

Executives including Goldman Sachs Group Inc. Chairman and CEO Lloyd Blankfein, JPMorgan Chase & Co. CEO James Dimon, Morgan Stanley Chairman John Mack and Bank of American Corp. CEO Brian Moynihan appeared before the Financial Crisis Inquiry Commission. It is the first meeting of the bipartisan panel which is investigating the near collapse of the financial system in the fall of 2008.

While the executives agreed that banks' actions contributed to the crisis that paralyzed the credit markets and worsened the recession, investors did not hear anything from the hearings that would encourage them to flee financial stocks.

Meanwhile, the Federal Reserve provided some optimism about the economy in its report on regional economic conditions. The Fed's Beige Book report said the economic recovery was spreading geographically, even though millions of Americans are still struggling to find jobs.

In a sign that investors may be becoming defensive, industries seen as safer in a weak economy like health care and utilities posted some of the day's biggest gains. Drugmaker Merck & Co. was the biggest gainer in the Dow 30 following an analyst upgrade.

After a strong first week of the year in stocks, a disappointing profit report from Alcoa Inc. late Monday is causing concern that the robust earnings investors had been expecting for the final quarter of 2009 might not materialize.

In much of 2009, companies boosted earnings by laying off workers and slashing expenses. But the benefits of cost-cutting can only go so far, and investors are looking for signs that increases in revenue will lift earnings. Intel Corp. is expected to post results Thursday, and JPMorgan Chase & Co. reports Friday.

The Dow rose 53.51, or 0.5 percent, to 10,680.77. The index traded above 10,700 for the first time since Oct. 3, 2008, rising as high as 10,709.26.

The broader Standard & Poor's 500 index rose 9.46, or 0.8 percent, to 1,145.68, and the Nasdaq composite index rose 25.59, or 1.1 percent, to 2,307.90.

Stocks pulled higher in afternoon trading after the Fed said the economy is rebounding in more parts of the country. The report, which provides readings on the U.S. economy by region and precedes the next meeting of the Fed's interest rate policymakers by two weeks, boosted hopes for a rebound.

Stephen Wood, chief market strategist at Russell Investments, expects improvements in economic and corporate news in 2010 will be incremental and that big gains seen in the market in the past 10 months will taper off.

"This might be like running on the beach with your shoes on. It's going to be a real slog," Wood said.

Bond prices fell after jumping Tuesday, pushing yields higher. The yield on the benchmark 10-year Treasury note rose to 3.80 percent from 3.72 percent late Tuesday.

Crude oil fell $1.14 to settle at $79.65 per barrel on the New York Mercantile Exchange. The drop in oil hurt stocks of energy companies.

The dollar fell against most other major currencies, while gold rose.

Investors sold shares of Google Inc. after the Internet search company threatened to withdraw from China over censorship and computer-security concerns. Google fell $3.39, or 0.6 percent, to $587.09. Shares of China's largest search engine, Baidu, rose $52.99, or 13.7 percent, to $439.48.

In other trading, Chevron Corp. fell 61 cents, or 0.8 percent, to $79.80 as oil dropped.

Three stocks rose for every one that fell on the New York Stock Exchange, where consolidated volume came to 4.25 billion shares, down from 4.76 billion Tuesday.

The Russell 2000 index of smaller companies rose 8.06, or 1.3 percent, to 643.56.

Britain's FTSE 100 fell 0.5 percent, Germany's DAX index rose 0.3 percent, and France's CAC-40 edged up less than 0.1 percent. Japan's Nikkei stock average fell 1.3 percent, China's Shanghai index fell 3.1 percent, and Hong Kong's Hang Seng index lost 2.6 percent.

E-mail E-mail article      Print Print      Share Share

More Business & Technology

UPDATE - 09:46 AM
Exxon Mobil wins ruling in Alaska oil spill case

UPDATE - 09:32 AM
Bank stocks push indexes higher; oil prices dip

UPDATE - 08:04 AM
Ford CEO Mulally gets $56.5M in stock award

UPDATE - 07:54 AM
Underwater mortgages rise as home prices fall

NEW - 09:43 AM
Warner Bros. to offer movie rentals on Facebook

More Business & Technology headlines...

Comments
No comments have been posted to this article.


Get home delivery today!

Video

Advertising

AP Video

Entertainment | Top Video | World | Offbeat Video | Sci-Tech

Marketplace

Advertising