As Egypt’s President Hosni Mubarak stepped down following prolonged mass protests, the markets moved up and ended with modest gains on Friday. Encouraging economic data also helped investors gain in confidence.
On Friday, markets closed after a second consecutive week of gains. The Dow closed at 12273.26, up 0.4%. For the week the Dow was up 1.5%. The S&P 500 rose 0.6% and ended the day at 1329.15. The tech-laden Nasdaq was up 0.7% and ended at 2809.44. The S&P 500 and the Nasdaq were up 1.4% each for the week. The volatility index (VIX) was down 2.49% and closed at 15.69. On the New York Stock Exchange, breadth of the market favored the advancing stocks and outnumbered the declining stocks in the ratio of 3:2 on moderate volumes.
The crisis in Egypt had been a reason to worry about for investors. Nonetheless the indices had been moving up following strong earnings releases as the Dow touched the 12, 000 mark. Three weeks of anti-government protests in Egypt had caused much unrest throughout the world, stoking fears that the crisis could spill over to oil-rich countries like Saudi Arabia. However, even during this period of uncertainty, the Dow recorded its highest level since June 2008 while the markets as a whole also ended in the green.
On the domestic front, economic news helped markets and data suggested a rise in consumer sentiments. The University of Michigan reported that its consumer index was up to 75.1 this month from 74.2 in January. Index of current conditions recorded its highest reading since 2008 as it rose to 86.8.
Financials led the rally as the government proposed to cut down the size of the Federal Housing Administration, a government run organization that competed with the private mortgage insurance industry. Following the news, mortgage insurers such as Genworth Financial (NYSE:GNW) rose 4.4%, MGIC Investments (NYSE:MTG) soared 9.6% and PMI Group (NYSE:PMI) jumped 2.8%.
Among other stocks that hogged the limelight in Friday’s trade were US shares of Nokia Corp (NYSE:NOK), which slumped 14% after news that the hand set maker had entered into a strategic alliance with Microsoft (NASDAQ:MSFT) on a broader platform and will adopt Windows Phone as its main smartphone platform. Shares of Microsoft dipped 0.9%. Ford Motor (NYSE:F) was up 2.7% after it announced it was cutting its debt load by another $3 billion.
In earnings and estimates news, Chipotle (NYSE:CMG) rose 4.7% after its fourth quarter revenue and earnings per share beat analysts’ consensus. Discovery Communications (NASDAQ:DISCA) reported fourth quarter results and stated that the increase in earnings was primarily due to sales growth of TV advertising across its media business in the second half of 2010. The share was up 1.16%. Shares of WABCO Holdings Inc. (NYSE:WBC) rose 8.8% after reporting better-than-expected fourth quarter earnings.
CHIPOTLE MEXICN (CMG): Free Stock Analysis Report
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GENWORTH FINL (GNW): Free Stock Analysis Report
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