Stock Market News for March 10, 2011 - Market News

The second anniversary of the market’s Bull Run ended on a weak note as markets pared gains of the earlier trading day and closed marginally lower. The S&P 500 has gained 95.4% since it slid to 676.53 on March 9, 2009. However, continuing unrest in the Persian Gulf and concerns over the conflict spreading to other oil rich nations continued to create apprehensions among investors. Technology stocks also weighed heavy on the indices following a weak outlook from Texas Instruments.

The volatile fear gauge, CBOE Volatility Index rose above 20 and the advance decline ratio on the New York Stock Exchange was evenly balanced. On the NYSE, Nasdaq and AMEX, consolidated volumes were roughly 7.04 billion shares, below the daily average volumes of 8.47 billion of last year. The Dow Jones Industrial Average dropped 0.01% and closed at 12,213.09. The Standard & Poor 500 (S&P 500) finished at 1,320.02 after shedding 0.1% and the Nasdaq was weighed down by tech stocks finishing at 2,751.72 after losing 0.5%.

On the domestic front, data released by the Mortgage Bankers Association showed the seasonally adjusted index of mortgage application activity has increased 15.5% for the week ended March 4. The index, which combines refinancing and home purchase demand, was at its highest level since the week ended December 10, 2010 and also posted the biggest increase in almost 9 months. An improvement in the job market was cited to be the reason for the surge. The index of refinancing index was also up 17.2% while the index of loan requests for home purchases added 12.5%. In another report, the Commerce Department reported that US wholesale inventories have climbed to their highest level in 14 months, providing optimism about strengthening demand. The report showed a better-than-expected jump in total wholesale inventories which rose 1.1% to $436.9 billion. Also, sales at wholesalers displayed a better than expected gain of 3.4% to reach $387 billion.

The tech sector dented the markets as the PHLX Semiconductor Index plunged 3% and closed below its 50 day moving average. The fall in the sector was mostly due to the weak outlook provided by Texas Instruments Inc. (NYSE:TXN) and Finisar Corp. (Nasdaq:FNSR). Texas Instruments reduced its guidance and suggested a weaker demand for television chips. The earnings target missed the Street’s expectations and the stock declined 3.1% to close at $34.74. Finisar reported a disappointing fourth quarter, blaming an inventory pile up and the stock tumbled 38.5% to close at $24.61. Shares of other tech companies were also hit with JDS Uniphase Corporation (NASDAQ:JDSU) and CIENA Corp. (NASDAQ:CIEN) shedding 16.7% and 5.3%, respectively.

The US government said crude oil inventories rose higher than expected, by 2.5 million barrels over the last week following a statement that US light sweet crude shed some of its price to settle below $105 per barrel. Speculation about higher production of oil in response to the disruption caused in crude supply due to Libyan unrest also helped the oil prices move slightly lower. All the oil indexes dropped points, including the NYSE Arca Oil Index, NYSE Arca Natural Gas Index and Philadelphia Oil Service Index, shedding 0.5%, 0.1% and 1.1%, respectively. The energy sector eventually slid lower and energy shares like Exxon Mobil Corp. (NYSE:XOM), Chevron Corp. (NYSE:CVX) and Transocean Ltd. (NYSE:RIG) dropped a few points.

Weakness in asset managers led the downward movement of the financial sector. After gaining a significant 2.2% on the previous trading day the Financial Select Sector SPDR Fund ended flat. Stocks like, Franklin Resources Inc. (NYSE:BEN), TD AMERITRADE Holding Corporation (NASDAQ:AMTD), Nasdaq OMX Group Inc., Ameriprise Financial Inc. (NYSE:AMP) and Legg Mason Inc. (NYSE:LM) slipped 2.5%, 1.5%, 2.2%, 2.0% and 1.8%, respectively. However, gains in real-estate and regional-bank stockstrimmed some of the losses and regional bank shares like Zions Bancorp. (NASDAQ:ZION), Fifth Third Bancorp (NASDAQ:FITB), and KeyCorp (NYSE:KEY) moved higher.

Stock Market News for March 10, 2011 – Market News

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