Stock Market News for October 28, 2010 - Market News

After swinging back and forth for much of the session, stocks closed mostly in the red Wednesday amid concerns that the Fed’s planned purchase of Treasury bonds would not be as heavy and swift as earlier anticipated.

Traders are eagerly awaiting a Federal Reserve move to inject more money into the economy by buying bonds. Expectations that the U.S. central bank would soon launch the asset purchases have fueled a rally in stocks. However, market participants are now concerned that the second round of quantitative easing would not be as big as has been expected.

Those worries strengthened further after a Wall Street Journal report said yesterday that the Fed would buy no more than $200 billion worth of bonds and the purchases would be spread over several months.

The Dow Jones industrial average dropped 149 points in the morning session, before recovering much of those losses to close at 11126, off 43 points. The technology-focused Nasdaq Composite index managed a 0.2% advance to close at 2503. The broader S&P 500 index fell, 0.3%, its first drop in six sessions.

The dollar strengthened as risk appetites waned. Crude prices eased $0.61, or 0.7%, to close at $81.94 as a US inventory post on weekly crude supplies noted a greater-than-expected build of 5 million barrels. After its recent record run, gold also appeared to be losing some shine and fell $15.10, or 1.1%, to settle at $1,322.60. US Treasuries also fell, as an auction of $35 billion in 5-year notes yesterday saw a yield of 1.33%. Today the Treasury sells $29 billion in 7-year notes.

Only two of the S&P500 industry sectors managed gains Wednesday, with technology (+0.6%), and financials (+0.1%) closing in the green. Basic materials (-1.1%), industrials (-0.6%), oil and gas and health care sector shares, both off 0.5%, followed by consumer goods, telecommunications, and utilities (-0.4%), and consumer services (-0.3%) led on the downside.

A number of big names come out with their earnings today, including 3M (NYSE:MMM), ExxonMobil (NYSE:XOM), Royal Dutch Shell (NYSE:RDS), Motorola (NYSE:MOT), Potash (NYSE:POT), Blackstone (NYSE:BX), and Colgate-Palmolive (NYSE:CL). After the market closes, Microsoft (NASDAQ:MSFT) and MetLife (NYSE:MET) report their earnings.

Yesterday Sprint (NYSE:S) dropped almost 10% after the company reported a greater-than-expected loss of $0.30 on higher costs. Whirlpool (NYSE:WHR), which reported better-than-expected results, fell 4.1% as weak sales in Europe and North America sent third quarter results down 9.2% from a year earlier.

International Paper (NYSE:IP) shares gained 4.5% after the company reported better-than-expected earnings of $0.91, $0.12 better than estimated, on revenues up 13.5% to $6.7 billion, versus estimates of $6.6 billion. Comcast (NASDAQ:CMCSA) shares gained 3.2% after its third-quarter earnings of $0.32 beat estimates by 2 cents, as revenue grew 7.3% to $9.5 billion, above estimates of $9.4 billion. General Dynamics (NYSE:GD) rose 2.1% after reporting better-than-expected earnings of $1.70, beating average estimates by a nickel, even as revenues, up 3.8% to $8 billion, fell below expectations for $8.4 billion.

Stock Market News for October 28, 2010 – Market News

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