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MarketView
Events defining the day's trading activity on Wall Street
Lauren Rudd
Wednesday, April 20, 2011
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.
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MarketView for April 20
MarketView for Wednesday, April 20