PortfolioCrafter - Market Commentary 9/29/05
September 29th, 2005 / 8:01 pm / by portfoliocrafter
Today investors overcame worries about record-high energy prices and focused on late-quarter portfolio additions. Bargain hunting after two down weeks fired up a broad based rally and the stocks firmed up.
The Dow Jones industrial average closed up 79.69 or almost 0.8% to 10,552.78, the broader Standard & Poor’s 500 ended up 10.79 or around 0.9% to 1,227.68, and the Nasdaq composite firmed up 25.82 or 1.2% to 2,141.22. Today was the fourth straight session of gains for the Dow, the fifth consecutive positive finish for the S&P and the biggest one-day gain in nearly three months for the Nasdaq.
Market breadth was positive. Volume was more than 1.62 billion shares on the New York Stock Exchange, where rising shares outnumbered losers by 22 to 9. On the Nasdaq, advancers topped decliners 19 to 11 on volume of 1.83 billion shares. The rally was broad based with a variety of sectors participating. Gains in tech, financials and homebuilding were the most prominent. Around 25 out of 30 Dow stocks gained on the session.
PepsiCo advanced 2.6% to close at $56.50 on news of beating its revenue and profit targets for the third quarter. Red Hat too closed up $4.93 to $21.44, on reported higher quarterly earnings and revenue that beat estimates.
The Nasdaq rally was led by Intel which shot up $0.53 to $24.48. This boosted the Philadelphia Semiconductor Index up 7.10 or 1.6% to 466.36. eBay closed up $2.34 to $41.27, and Yahoo ended up $1.08 to $33.43.
In Buy out news, General Electric Co closed up 16 cents at $33.65. GE is likely to buy IDX Systems Corp. E-Trade Financial Corp. shot up 5.4% to $17.22, after announcing it will buy Brown Co. from J.P. Morgan Chase for $1.6 billion in cash.
Decliners today included Guidant Corp. that fell almost 3% to $68.17. Stock of Research in Motion closed down $7.45 or 9% to $69.80 despite improved quarterly earnings.
Amongst prominent news of the day was the confirmation of John Roberts as U.S. chief justice and the guilty plea by the top Executives of the Bayou Group for orchestrating a $450 million fraud. The hedge fund shop has hurt a handful of big investors including some funds that invest in hedge funds on behalf of clients.
U.S. light crude Oil for November delivery rose 44 cents to settle at $66.79 a barrel on the New York Mercantile Exchange. Natural gas for November delivery rose 10 cents to $14.20 per million BTU.
All the best,
Manuel Jesus-Backus
The Portfolio Crafter
