MarketView for April 20

MarketView for Wednesday, April 20 
 

 

 

MarketView

 

Events defining the day's trading activity on Wall Street

 

Lauren Rudd

 

Wednesday, April 20, 2011

 

 

Dow Jones Industrial Average

12,453.54

p

+186.79

+1.52%

Dow Jones Transportation Average

5,258.76

p

+20.01

+0.38%

Dow Jones Utilities Average

417.70

p

+5.22

+1.27%

NASDAQ Composite

2,802.51

p

+57.54

+2.10%

S&P 500

1,330.36

p

+17.74

+1.35%

 

 

Summary 

 

Earnings surprises sent share prices on Wall Street stocks to their best day in a month, while at the same time propelling the Dow Jones industrial average to its highest level in nearly three years. Better than expected earnings reports from blue chips Intel and United Technologies resulted in a broad-based rally that puts equities on the path for more gains in coming weeks. Intel rose 7.8 percent to $21.41 while United Tech gained 4.3 percent to $85.90.

 

Meanwhile, the S&P 500 index broke decidedly above its 20-day moving average, setting a near-term target at 1,340, according to its Bollinger bands chart, a technical indicator that tracks momentum and volatility.

 

The trend of positive earnings continued after the market's close on Wednesday, with Apple up 2.7 percent at $351.80 after a blowout quarter that surged past expectations. Revenue for the tech giant rose 83 percent year-over-year.

 

F5 Networks, considered a momentum favorite for investors, climbed 11 percent to $110.39 after its second-quarter profit topped expectations and the company forecast third-quarter earnings largely above estimates. Adding to the positive tone were VMware, Freeport-McMoRan Copper & Gold and EMC, with EMC also raising its profit view. However, not all the news was favorable as American Express fell 1.3 percent to $46.40. While the Dow component's profit topped expectations, expenses at the credit card company rose.

 

The Nasdaq posted its largest daily percentage gain since October while the Dow hit its highest close since early June 2008. The broad S&P 500 had its best performance in a month. The PHLX Semiconductor index .SOX jumped 4.3 percent, the largest percentage gain since early July.

 

About 7.6 billion shares traded on the major equity exchanges, a number that was  below last year's estimated daily average of 8.47 billion but an improvement of recent days.

 

Sales of previously owned homes rose more than expected in March, a trade group said on Wednesday, suggesting the housing market's downward trend may be close to hitting a bottom.

 

The PHLX housing sector .HGX index rose 1.2 percent with home builder D.R. Horton Inc (DHI.N) up 3 percent at $12.17.

 

On the downside, International Business Machines Corp (IBM.N) slipped 0.4 percent to $164.75 after reporting a drop in signings of new business at its global services division during the first quarter. However, the Dow component's profit and revenue came in above analysts' projections and it raised its full-year profit view.