Stock Market News for April 3, 2013 - Market News
03 April 2013 - 11:36AM
Zacks
Encouraging factory orders data and
strong domestic auto sales boosted investor confidence on Tuesday.
Improving payment rates in the healthcare sector added to the
bullish mood. Investors also derived optimism from a conclusion to
the Cyprus deal. Among the top ten S&P 500 industry groups,
healthcare stocks gained the most while materials stocks were the
biggest losers.
The Dow Jones Industrial Average
(DJI) gained 0.6% to close the day at 14,662.01. The S&P 500
increased 0.5% to finish yesterday’s trading session at 1,570.25.
The tech-laden Nasdaq Composite Index gained 0.5% to end at
3,254.86. The fear-gauge CBOE Volatility Index (VIX) dropped almost
5.9% to settle at 12.78. Consolidated volumes on the New York Stock
Exchange, American Stock Exchange and Nasdaq were roughly 5.9
billion shares, below 2012’s average of 6.48 billion shares.
Declining stocks outnumbered the advancers. For the 47% that
advanced, 49% declined.
Since the beginning of this year,
economic data has been mostly positive indicating an improving
economy. Riding on positive domestic data, the Dow Jones and the
S&P 500 neared all-time highs. The Dow Jones increased as much
as 111 points in intra-day trade while the S&P 500 was just 2.4
points shy of its all-time high. The S&P 500 has gained 10.3%
this year.
Strong factory orders data boosted
investor confidence yesterday. According to the U.S. Department of
Commerce, in February, new orders for manufactured goods increased
3% above the consensus estimate of 2.2%. This data follows a
decrease of 1% in January. This is the highest level attained on
NAICS (North American Industry Classification System) basis since
1992. Factory orders have gone up for two out of the previous three
months. Shipments increased 0.9% while inventories data was up
marginally, by 0.2%.
Meanwhile, sales of domestic
vehicles remained flat. In March, sales of domestic vehicles were
reported at 12.1 million, marginally higher than consensus estimate
of 12 million. Although vehicle sales are not a major factor when
it comes to changes in retail sales, it constitutes about 20% of
the retail sales data.
The U.S. government said that it
would increase payment rates by 3.3% in 2014 for health insurers
that provide coverage through the Medicare Advantage program. This
decision follows an announcement in February that a payment cut of
2.3% would be made. Currently, almost 14 million Americans are a
part of this program. Following these developments, investors
turned bullish towards the healthcare sector. The sector has gained
almost 16% this year.
On the international front,
investors received a boost after the conclusion of the Cyprus
bailout deal. According to the deal, Cyprus will receive a 10
billion Euro loan along with a time period of 5 years to improve
its financial situation. According to data released by the European
Union, the unemployment rate in the Euro Zone has increased to
12.0% from 11.9% in January. In terms of numbers, about 19 million
people are jobless in the Euro Zone. Month over month, the number
of unemployed people has increased by 1.8 million.
Among the top ten S&P 500
industry groups, healthcare stocks performed the best. The Health
Care SPDR (XLV) gained 1.5%. Stocks such as Johnson & Johnson
(NYSE:JNJ), Pfizer Inc. (NYSE:PFE), Abbott Laboratories (NYSE:ABT),
Amgen, Inc. (NASDAQ:AMGN) and Gilead Sciences, Inc. (NASDAQ:GILD)
gained 0.9, 1.4%, 2.3%, 4.0% and 0.5%, respectively.
Materials stocks suffered the most.
The Materials Select Sector SPDR (XLB) lost 1.0%. Stocks such as
Monsanto Company (NYSE:MON), the Dow Chemical Company (NYSE:DOW),
Praxair, Inc. (NYSE:PX), Freeport-McMoRan Copper & Gold Inc.
(NYSE:FCX) and PPG Industries, Inc. (NYSE:PPG) declined 1.7%, 1.3%,
0.1%, 1.4% and 0.4%, respectively.
ABBOTT LABS (ABT): Free Stock Analysis Report
AMGEN INC (AMGN): Free Stock Analysis Report
DOW CHEMICAL (DOW): Free Stock Analysis Report
FREEPT MC COP-B (FCX): Free Stock Analysis Report
GILEAD SCIENCES (GILD): Free Stock Analysis Report
JOHNSON & JOHNS (JNJ): Free Stock Analysis Report
MONSANTO CO-NEW (MON): Free Stock Analysis Report
PFIZER INC (PFE): Free Stock Analysis Report
PPG INDS INC (PPG): Free Stock Analysis Report
PRAXAIR INC (PX): Free Stock Analysis Report
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