PortfolioCrafter - Market Commentary 12/28/05
December 28th, 2005 / 8:09 pm / by portfoliocrafter
Today the Dow crawled back into positive territory for the year after the drubbing it received yesterday. The stabilized Treasury yield curve and a larger-than-expected rise in consumer confidence helped buoy investor sentiment, and overshadowed a surge in crude oil prices.
The Dow Jones Industrials Average rallied 18.49 points to 10,796.26, the Standard & Poor’s 500 Index tacked on 1.63 points to 1,258.17 and the Nasdaq Composite ended 2.05 points higher at 2,228.94. The three gauges see-sawed on both sides of unchanged throughout the session as investors weighed competing influences. Year-to-date, the Dow is little changed, the S&P is up 4 percent and the Nasdaq is up around 2.5 percent.
Market breadth was positive and volume was moderate. On the New York Stock Exchange, winners topped losers 11 to 5 as 830 million shares changed hands. On the Nasdaq, advancers edged decliners 8 to 7 on volume of almost 1 billion shares.
A strong reading on consumer confidence with the Conference Board’s index jumping to 103.6 from a downwardly revised 98.3 in November, topped analysts’ estimates. This gave a boost to investor confidence. The 3% jump in oil prices provided a catalyst for scooping up recently beaten-down oil stocks.
A rally in the oil sector, led the Amex Oil index to jump up 15.38 or 2% to 989.59. Valero energy closed up $1.06 to $51.96, ConocoPhillips gained $0.98 to $58.48, and Exxon Mobil jumped up $0.42 to $56.29. Other Dow gainers included Alcoa which gained $0.40 to $29.65, and 3M jumped up $0.89 to $78.27. Clegene closed up $3.45 or 4.5% to $60.93, after announcing that regulators had approved its treatment for a rare bone marrow disorder. The company also announced a 2-for-1 stock split and some management changes. Linens N Things closed up $2.68 or 11% to $26.59, after announcing that it should meet financial targets necessary for a potential takeover by buyout firm Apollo Management LP.
U.S. light crude oil for February delivery shot up $1.66, or 2.9%, to close at $59.82 on the New York Mercantile Exchange, amid renewed talk that the Organization of Petroleum Exporting Countries (OPEC) might cut production at its next meeting. January natural gas futures rose 40.9 cents, or 3.7%, to $11.431 per million BTU.
All the best,
Manuel Jesus-Backus
The Portfolio Crafter
