Stocks Cling To Modest Gains

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Includes: DIA, QQQ, SPY
by: Midnight Trader
  • Dow Jones Industrial Average up 6.51 (+0.05%) at 13,239.13.
  • S&P 500 up 5.58 (+0.40%) to 1,409.75.
  • Nasdaq Composite Index up 23.06(+0.75%) to 3,078.32.

GLOBAL SENTIMENT

  • Nikkei 225 up 0.12%.
  • Hang Seng Index down 0.95%.
  • China Shanghai Composite Index up 0.23%.
  • FTSE 100 down 0.05%.

Stocks turned solidly higher near mid-day and mostly held those gains through to the close. The Nasdaq Composite index closed at its best level since May 2008. Other major indices also maintained their perch near multi-year highs.

Apple Inc. (NASDAQ:AAPL) shares finished with more than a 2% gain after the tech heavyweight said it will pay a $2.65 a share dividend to shareholders beginning during its fiscal Q4 starting in July. It also plans to buy back up to $10 billion in stock. On a conference call Monday, Apple Chief Executive Tim Cook reportedly said that "these decisions will not close any doors for us," and that product innovation remained the company's priority.

Financial stocks also got a boost after the Federal Reserve late Friday acknowledged it made some minor corrections to its stress test results. Citigroup (NYSE:C) rose after the Fed said it overstated a measurement of losses on the bank's mortgages. The Fed also issued corrections for Bank of America (NYSE:BAC), Ally Financial (NYSE:ALLY), MetLife (NYSE:MET) and Wells Fargo (NYSE:WFC), but said the corrections did not change the capital ratios projected by the stress tests, which attempted to measure the losses that a bank could bear during events such as a severe recession or a market collapse. BAC shares were set to close above $10 each for the first time since last August.

In a light day for economic reports, a measure of homebuilder confidence this month was unchanged from a revised 28 reading in February, according to the National Association of Home Builders/Wells Fargo Housing Market Index. The reading had risen five consecutive months, reaching its best level since June 2007. February's advance, however, was pared slightly from the 4-point advance originally reported to a 3-point gain.

Experts polled by Marketwatch were expecting the index to remain unchanged at 29. Readings over 50 indicate more builders view conditions as good rather than poor. Later this week, new data on housing starts during February will be released tomorrow, followed by existing home sales on Wednesday. New-home sales figures are due out on Friday.

In other company news, United Parcel Service (NYSE:UPS) increased its offer for TNT Express to $6.85 billion in a deal that would establish it as the market leader in Europe and gain access to TNT's networks in the fast-growing Asian and Latin American markets. Overall, global sales should top $60 billion.

Most industry sectors in the S&P 500 ended higher, with only utility stocks finishing in the red. Financial stocks helped the overall advance for stocks, rising nearly 1%, along with tech stocks, which got a big boost from AAPL.

Commodities were mixed with gold for March delivery slipping $3.60 to settle at $1,655.50 an ounce. Crude oil settled higher today, with the April futures contract gaining $1.03 to finish at $108.09 a barrel in NYMEX trading. April natural gas settled 2.5 cents higher at $2.351 per million British thermal units.

UPSIDE MOVERS

(+) ABVT, Agrees to $2.2 billion buyout by Zayo Group LCC.

(+) HPOL, Begins $3 million stock buyback program; sets new 52-week high.

DOWNSIDE MOVERS

(-) SGRP, Q4 profit unchanged from year ago despite 26% jump in revenues.

(-) EBAY, Citigroup downgrade to Neutral from Buy, citing valuation.