Author Topic: Saddam can't help stocks  (Read 50 times)

M Dogg™

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Saddam can't help stocks
« on: December 15, 2003, 08:46:08 PM »
Market rallies in the morning, retreats sharply by the close despite capture of former Iraqi leader.
December 15, 2003: 5:29 PM EST
By Alexandra Twin, CNN/Money Staff Writer

NEW YORK (CNN/Money) - U.S. stocks tumbled Monday, with the major indexes retreating after hitting new yearly highs last week, despite an early boost spurred by the capture of former Iraqi leader Saddam Hussein over the weekend.

The Dow Jones industrial average (down 19.34 to 10022.82, Charts) closed fractionally lower, the Standard & Poor's 500 (down 6.10 to 1068.04, Charts) index closed around 0.6 percent lower and the Nasdaq composite (down 30.74 to 1918.26, Charts) lost around 1.6 percent. All three had rallied strongly throughout the morning.

"We're at pretty high levels on the indexes, there's a lot of economic news coming out over the next few days, and Friday is a quadruple witching day, all of which is adding to the volatility and the pullback," said Paul Mendelsohn, chief investment strategist at Windham Financial Services.

Quadruple witching refers to the day when stock index futures, stock index options and individual stock futures and options all expire simultaneously. Ahead of this, it is not uncommon to see wild gyrations in prices in the underlying stocks.

Tuesday brings economic reports on consumer prices, housing starts and building permits, the current account deficit and industrial production and capacity utilization figures.
"The capacity utilization and industrial production number are forecast to show modest improvement, the housing number won't be as strong as it has been, but it'll still be strong. However, none of these data due tomorrow are really market-moving," said John Davidson, president and CEO, PartnersRe Asset Management. "I think stocks may be set to drift the rest of this week and into the close of the year. "

Stocks had initially rallied in the morning on news that deposed Iraqi President Saddam Hussein was captured over the weekend by U.S. forces just outside of his hometown of Tikrit. The news came some nine months after a coalition headed by the United States launched a war on Iraq.

However, the early rally gave way by the afternoon. "While the capture is important on a humanistic level for the market, after reacting to it overnight, we're back to the usual focus: earnings and the economy," said Tom Schrader, head of listed trading at Legg Mason.

On a broader level, the Nasdaq's selloff Monday was consistent with market trends throughout December. After pushing the Nasdaq up 46 percent year-to-date (as of Friday's close), investors are now wanting to take a little money out of the best performers and rotate it into those that have not benefited as much. By comparison, the Dow is up 20.4 percent year-to-date and the S&P 500 is up 22.1 percent.

"People who have doubled or tripled their money have begun to look at the multi-nationals," Mendelsohn added. "You're seeing money go into the telecoms lately, some of the drugs are stabilizing, Coke was recently at a new 52-week high."

The Dow started the week above 10,000 for the first time in more than 18 months. The S&P 500 is also right near its 18-month highs. Optimism about the economic recovery and a continued improvement in corporate profits have led the latest stage of the rally, which began in March, at around the time of the attack on Iraq.

The movers
After the close of trade, business software maker Oracle (ORCL: down $0.13 to $12.70, Research, Estimates) reported quarterly earnings of 12 cents a share, a penny more than expected and two cents more than it earned a year earlier, thanks to gains in software license sales.
On the Dow, Wal-Mart Stores (WMT: down $1.76 to $50.74, Research, Estimates) lost more than 3 percent after the retailer said sales at stores open a year or more would come in at the low end of its previous target range, as people delayed holiday shopping.

Intel (INTC: down $0.62 to $30.24, Research, Estimates) also lost around 2 percent as part of the overall tech pullback that swept the market in the last hour of trade. Intel is both a Dow 30 stock and also one of the Nasdaq's most heavily-weighted issues.
Among other movers, shares of El Paso (EP: up $0.58 to $7.32, Research, Estimates) added 8.6 percent in active NYSE trade after the energy company said it planned to cut debt by around one-third and sell as much as $3.9 billion in assets by the end of 2005.

Shares of soap and detergent maker Dial (DL: up $2.50 to $28.38, Research, Estimates) rallied 9.6 percent after the company agreed to a $2.9 billion buyout offer from German company Henkel.

Market breadth was negative. Almost five stocks fell for every three that rose on the New York Stock Exchange, while losers beat winners eleven to five on the Nasdaq. Around 1.45 billion shares changing hands on the NYSE and 1.78 billion shares traded on the Nasdaq.

Treasury prices edged lower, pushing the yield on the 10-year note up to 4.26 percent from 4.24 percent late Friday. The euro hit a new record high versus the dollar, while the U.S. currency also declined versus the yen.

NYMEX light sweet crude oil futures gained 29 cents to settle at $33.24 a barrel. COMEX gold abandoned afternoon gains, falling 20 cents to settle at $409.90.

European markets closed higher. Asian markets closed higher Monday as well.


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Re:Saddam can't help stocks
« Reply #1 on: December 15, 2003, 09:13:45 PM »
What is newsworthy about this?  Another day on wallstreet.  The dow is down 19 points.  Big deal.  

Don Jacob

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Re:Saddam can't help stocks
« Reply #2 on: December 16, 2003, 02:01:39 AM »
^ exactly

plus it's not like the stocks dropped dramatically , that's pretty much average. plus stocks dont' usually start off  good at the begining of the week.

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