Telecom and consumer staples fared best among S&P 500 sectors
U.S. stocks finished on higher Tuesday, 29 October 2013 with both blue-chip stocks and the S&P 500 index setting record closing highs, as results from Pfizer and an International Business Machines stock buyback stoked momentum. The tech-heavy Nasdaq posted a modest advance after the exchange experienced an intraday data dissemination issue that prevented index quotes from being sent out for nearly an hour. However, the issue was isolated to the index while individual components traded normally.
The Dow Jones Industrial Average gained 111.42 points, or 0.7%, to close at 15,680.35. The Nasdaq Composite rose 12.21 points, or 0.3%, to close at 3,952.34,. The S&P 500 notched its 33rd record close of the year, finishing up 9.84 points, or 0.6%, at 1,771.95.
Telecom and consumer staples fared best among S&P 500 sectors, while materials and utilities performed the worst. IBM led the index, closing up 2.7%, after the company authorized an additional $15 billion stock buyback, followed by shares of AT&T and Home Depot. Pfizer also fed the blue-chip rally with a 1.7% gain following its quarterly earnings report before the open.
One of the components that contributed to the Nasdaq's underperformance was Apple. The largest tech stock lost 2.5% after its below-consensus gross margin guidance overshadowed its earnings beat on above-consensus revenue.
IBM rallied after the company's Board of Directors authorized an additional $15 billion for its share buyback program.
Among economic reports expected for the day, the Conference Board's Consumer Confidence Index plummeted in October, falling from an upwardly revised 80.2 (from 79.7) to 71.2 (73.1 consensus). The entire decline in confidence can be attributed to the reaction to the government shutdown and near-default by the U.S. Treasury.
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Separately, September retail sales declined 0.1% to follow an August increase of 0.2% (-0.1% consensus). The headline decline in retail sales masked an otherwise strong report, especially considering that private payroll growth was much weaker than expected. The entire decline in sales was the result of a 2.2% drop in motor vehicle demand.
Total business inventories increased 0.3% in August after increasing 0.4% in July (+0.2% consensus). Also of note, September producer prices fell 0.1% after increasing 0.3% in August (+0.2% consensus). That was the first monthly decline since prices fell 0.7% in April.
Among commodities, December gold chopped around in negative territory today as a stronger dollar index pressured prices. The yellow metal brushed a session high of $1352.90 per ounce in late morning pit trade but was unable to sustain the momentum. It settled 0.5% lower at $1345.30 per ounce, slightly above its session low of $1342.40 per ounce.
December silver spent most of the session trading near the unchanged line after lifting from a session low of$22.38 per ounce set in early morning pit trade. It eventually settled with a 0.1% loss at $22.49 per ounce.
December crude oil fell for the first time in four sessions as the dollar index advanced. The energy component traded as low as $97.82 per barrel and settled with a 0.4% loss at $98.26 per barrel. December natural gas retreated back into negative territory after touching a session high of $3.67 per MMBtu in early morning pit trade. It settled 0.8% lower at $3.63 per MMBtu.
Trading volume was on the light side as just over 680 million shares changed hands on the floor of the New York Stock Exchange. Today's economic data was plentiful, but did little to suggest the Federal Reserve will be eager to curtail the pace of its asset purchases in the near term.
Tomorrow, the weekly MBA Mortgage Index will be reported at 7:00 ET, October ADP Employment Change will be released at 8:15 ET, and September CPI will cross the wires at 8:30 ET. In addition, the FOMC will release its latest policy statement at 14:15 ET.
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