Traders-Blog.com

Today was a third day of gains for the market. The Dow rose 92.81 points to close at 10,841.60. Besides, both the Nasdaq and the S&P rose today. The Nasdaq rose 13.70 points closing at 2,065.40, while the S&P closed at 1,211.37 after rising 11.17 points. Nevertheless, the dollar was down 0.4 percent against the euro at $1.3243 and down 0.3 percent against the Japanese yen at 105.20.

Oil stocks, such as Exxon Mobil Corp., Anadarko Petroleum and Varco International closed higher today because April crude-oil futures settled at $51.49 a barrel. The Amex Oil Index was up 1.8 percent closing at 863.09 points with Exxon Mobil Corp. closing at a 52-week high of $63.26. Furthermore, Prudential Equity Group upgraded Exxon Mobil from “neutral” to “overweight” to make an advantageous call to the sector. Still, Prudential expects a significant oil price correction which could lead to a better buying opportunity.

MCI, the second long-distance phone company, posted a $32 million loss in the fourth quarter as revenue slipped from last year and the company reported an unusually high tax expense. After the bid on Thursday’s night, Qwest increased the offer to $24.60 an MCI share, compared with $20.75 from Verizon. MCI reported that it expects its 2005 revenue to fall 10 percent to 14 percent from 2004 to $19 billion. Still, this amount matches of beats Wall Street consensus expectations. MCI expects to generate operating income before depreciation and amortization of $1.8 billion to $2 billion in the year 2005.

The U.S economy grew at a 3.8 percent annual rate in the fourth quarter of 2004. This increase was faster than initially reported since businesses spent more on equipment and software, and the trade deficit was smaller than expected. This growth in the fourth quarter suggests that the economy continued to perform strongly through the year-end. A 3.8 percent annual rate from October through December also supports Federal Reserve Chairman Alan Greenspan’s testimony, who asserted that “the economy entered 2005 expanding at a reasonable good pace”.

In early Friday trading, shares of H&R Block, the world’s biggest tax preparer, climbed 7 percent to $50.36. Nevertheless, H&R Block said that its third-quarter profit fell 14 percent due to weak earnings at its mortgage division. H&R Block’s mortgage business generated income of $112 million in this period, which shows a decrease of 28 percent from a year ago. This decrease may be the result of aggressive pricing and competition in the mortgage market.

All the best,
Manuel Jesus-Backus
The Portfolio Crafter