Wednesday's US Market Wrap

by: Between the Hedges

From Between the Hedges:

Stocks Finish Near Session Highs, Led by Tech and Small-cap Shares

S&P 500 1,302.89 +.75%
DJIA 11,215.70 +.55%
NASDAQ 2,337.78 +1.45%
Russell 2000 764.17 +1.72%
Wilshire 5000 13,175.60 +.88%
S&P Barra Growth 613.56 +.68%
S&P Barra Value 686.12 +.81%
Morgan Stanley Consumer 613.76 +.45%
Morgan Stanley Cyclical 818.82 +1.02%
Morgan Stanley Technology 545.20 +1.60%
Transports 4,568.49 +.80%
Utilities 397.08 +.80%
Put/Call .81 -19.80%
NYSE Arms .66 -50.36%
Volatility(VIX) 10.95 -5.44%
ISE Sentiment 137.00 -2.84%
US Dollar 90.20 -.06%
CRB 332.92 +.38%

Futures Spot Prices
Crude Oil 66.42 -.05%
Unleaded Gasoline 196.50 +.55%
Natural Gas 7.50 +.59%
Heating Oil 185.30 +.05%
Gold 573.00 -.05%
Base Metals 177.31 -.49%
Copper 245.65 unch.
10-year US Treasury Yield 4.80% +.51%

Leading Sectors
Internet +4.02%
Steel +3.73%
Disk Drives +3.49%

Lagging Sectors
Drugs -.03%
Oil Tankers -.43%
Broadcasting -.52%

Evening Review
Detailed Market Summary
Market Gauges
Daily ETF Performance
Style Performance
Market Wrap CNBC Video(bottom right)
S&P 500 Gallery View
Economic Calendar
Timely Economic Charts
PM Market Call
After-hours Movers
Real-time/After-hours Stock Quote
In Play

Afternoon Recommendations
Morgan Stanley:
- Rated CME Overweight, target $475
- Rated ICE Overweight, target $75.

Afternoon/Evening Headlines
- The drop in the US jobless rate is a correct signal that the labor market is tightening, a study by economists at the Fed showed.
- A proposed condominium and hotel tower that would be the tallest building in North America won approval from the Chicago City Council today, clearing the way for construction to start later this year.
- The five permanent members of the UN Security Council agreed on a draft statement demanding that Iran curb its nuclear program and cooperate with inspectors.
- Whirlpool(NYSE:WHR) can complete its $1.68 billion takeover of Maytag(MYG), the US Justice Dept. decided as it rejected concerns from its own lawyers that the combination might hurt competition.
- Google(NASDAQ:GOOG) plans to sell 5.3 million more shares to satisfy demand for the stock as the company joins the S&P 500.
- Boeing(NYSE:BA) said it received an order for at least thirty 737 jets valued at about $2 billion from GE’s(NYSE:GE) aircraft leasing unit.
- The US Senate approved its first revision of ethics rules in more than a decade, banning all gifts and meals from lobbyists, forcing greater disclosure, and doubling to two years the time that departing lawmakers must wait before lobbying former colleagues.

BOTTOM LINE: The tone of the market was very positive today as the advance/decline line finished substantially higher, almost every sector rose and volume was heavy. Measures of investor anxiety were mostly lower into the close. Overall, today's market performance was very bullish.

The Russell 2000 is now up 14% for the year. The average stock, as measured by the VGY Index, is 8.3% higher year-to-date. I sense that today's action is a harbinger of things to come on the Naz. Sustained p/e multiple expansion appears to have begun as investors gain confidence in the durability of the expansion. It appears to me that a portion of the capital that has been flooding into everything else is finding its way into U.S. equities.