Stocks enjoy a strong October
The major averages end the day basically flat but sport decent gains for the month. Earnings misses from Chevron and Merck offset gains for Alcoa and Microsoft. GDP grows at an annualized 2%.
Updated: 6:25 p.m. ET
Stocks finished little changed today, but the major indexes enjoyed their best October performances since at least 2006.
earnings reports were mixed. Dow components Chevron (CVX) and Merck (MRK) disappointed investors. (Check here and here.) Monster Worldwide (MWW), the online employment site operator, and cosmetics maker Estee Lauder (EL) delighted the Street.
The flat performance came despite the apparent shipment of explosive packages on planes flying to the United States. And the finish represented some good news after a government report showed overall economic growth to be lackluster at best.
The Dow Jones industrials ($INDU) closed up 5 points to 11,118. The Standard & Poor's 500 Index ($INX) was off 1 point to 1,183. The Nasdaq Composite Index ($COMPX) was flat at 2,507.
Among stocks making moves:
- Monster Worldwide, up 25.5% to $18.06, tops among S&P 500 stocks. The online-recruiting company forecast adjusted fourth-quarter earnings of as much as 8 cents a share. Analysts had been looking for 5 cents a share.
- Estee Lauder, up 10.5% to $71.17. The gain was the second-largest among S&P 500 stocks. The maker of Mac cosmetics and Clinique skin care earned 97 cents a share in the fiscal first quarter, topping the consensus estimate of 77 cents.
- Microsoft (MSFT), up 1.5% to $26.67. The software giant (and publisher of MSN Money) reported a 51% profit increase in its fiscal first quarter and easily beat Street estimates.
- Deckers Outdoor (DECK), up 7.6% to $58.10. The maker of Ugg boots and Teva sandals projected 2010 earnings will be up 22% from a year ago, up from prior guidance of 16%.
- Newpark Resources (NR), off 28.7% to $5.88, the biggest decline for stocks in the Russell 2000 Index ($RUT.X). The drilling-services company posted third-quarter earnings of 8 cents a share -- 28% below the Street estimate.
- Genworth Financial (GNW), down 9.9% to $11.33, worst among S&P 500 stocks. The mortgage guarantor and life insurer earned 6 cents a share in the third quarter, after one-time charges. Analysts had expected 26 cents.
To be sure, today's performance represents a wait-and-see attitude toward Tuesday's midterm elections and the Federal Reserve's decision on Wednesday on whether to offer a new plan to boost the economy.
But gold and silver prices were higher as the dollar moved lower against major currencies. Gold settled at $1,357.60 an ounce, up $15.10. Silver was up 69 cents to $24.56 an ounce. For the week, gold was up 2.45%; silver rose 6.25%.
Copper, meanwhile, was off 5.4 cents to $3.73 a pound and was down 1.7% on the week.
Crude oil settled down 75 cents to $81.43 a barrel. Traders have been worried about a glut of oil worldwide.
Interest rates were lower, with the 10-year Treasury yield at 2.612%, down from 2.661% on Thursday.
A surprisingly good October
The major averages ended the week basically flat. But, in a month that IBM (IBM) end at an all-time closing high and McDonald's (MCD) reach an all-time intraday high, the Dow ended October up 3.1%,.
The S&P 500 added 3.7% and the Nasdaq rose 5.9%. It was the best October performance for the Dow since 2006 and since 2003 for the S&P 500 and the Nasdaq.
The Nasdaq's 18.6% gain in September and October was its best performance for the two months since 1982, when the great 1980s bull market erupted. The September-October performances for the Dow and S&P 500 -- 11% and 12.8%, respectively -- were their best since 1998.
|Markets for the week|
|10/29/2010||10/22/2010||% chg.||YTD chg.|
|U.S. Dollar Index||77.457||77.69||-0.3%||-1.0%|
|(per troy ounce)|
Why the Fed may move
In addition to Tuesday's elections, the Fed is expected to announce plans to buy hundreds of billions of dollars in Treasurys to reduce interest rates. Investors have been questioning whether the reported purchases will be enough to jolt the economy.
The Commerce Department estimated that gross domestic product increased 2% in the third quarter, matching economists' forecasts. The gain was slightly more than the second quarter's 1.7% growth. Personal spending, the largest driver of economic growth, rose 2.6% as demand for services grew.
"Given the magnitude of the recession, the initial boost in growth was underwhelming," Jim Baird of Plante Moran Financial Advisors told The Street.com. The slow growth "suggests that job creation and income growth are also likely to remain tepid."
The Institute for Supply Management-Chicago said its business barometer rose to 60.6 this month from 60.4 in September. Figures greater than 50 signal expansion.
But the Thomson Reuters/University of Michigan final index of consumer sentiment fell to 67.7 from 68.2 last month.
Household purchases, about 70% of the economy, rose at a 2.6% pace, the best quarter of the recovery that began in June 2009.
The gain in consumer spending was the biggest since the end of 2006 and compared with a 2.5% median forecast from Bloomberg News.
Stock market gains and reduced debt may be allowing consumers to increase spending, which bodes well for the holiday season. The National Retail Federation has forecast November-December sales will rise 2.3% from a year ago, making it the best holiday season in four years.
Ruth's Hospitality Group (RUTH), operator of the Ruth's Chris Steakhouse chain, said holiday party bookings so far are up 17% from a year ago. (Shares rose 2.7% to $4.56.)
|Energy prices -- New York close|
|Fri.||Thur.||Month chg.||YTD chg.|
|(per mil. BTU)|
|(per gallon; AAA)|
Coinstar shares soar on earnings; Netflix targeted
Among the more fun performers today was Coinstar (CSTR), up 24.5% to $57.58. The owner of the Redbox movie-rental kiosks earned 60 cents a share in the third quarter, beating the Street estimate of 50 cents a share, as DVD revenue surged.
The company forecast 2011 earnings of $3 to $3.50 a share; the Street has been looking for $2.93. The company plans to start a streaming video service to compete against NetFlix (NFLX). Netflix was down 1.2% to $173.57.
|Short hits from the markets -- New York close|
|Fri.||Thur.||Month chg.||YTD chg.|
|13-week Treasury bill||0.110%||0.120%||-26.67%||120.00%|
|5-year Treasury note||1.179%||1.237%||-8.89%||-56.11%|
|10-year Treasury note||2.612%||2.661%||3.49%||-32.03%|
|30-year Treasury bond||4.000%||4.054%||8.20%||-13.81%|
|U.S. Dollar Index||77.457||77.503||-1.88%||-0.98%|
|(in U.S. $)|
|U.S. $ in pounds||£0.6237||£0.6271||-1.95%||0.89%|
|Euro in dollars||$1.3902||$1.3933||1.78%||-3.00%|
|(in U.S. $)|
|U.S. $ in euros||€ 0.7193||€ 0.7177||-1.75%||3.10%|
|U.S. $ in yen||80.65||81.00||-3.63%||-13.28%|
|U.S. $ in Chinese||6.69||6.68||-0.35%||-1.93%|
|(in U.S. $)|
|(in Canadian $)|
|(per troy ounce)|
|(per troy ounce)|
The Bush tax cuts will be kept including the ones for the wealthy (I predict two years). So I have to pay an extra 5-5K given my income when that happens. Won't kill me. Problem is Obama will give it to some lazy welfare cheat so they can lay back and enjoy life on the taxpayers' dime.
That's the good old USA. Rewards for doing nothing.
Let me see if I understand what you're suggesting. Either you, or the government, should determine how much wealth a person should possess? You also seem to have a problem with people that have been successful. I am not wealthy by any stretch of the imagination nor do I come from a wealthy family. I do, however, understand and agree with the concepts of risk & reward and being successful is a good thing. If it weren't for the wealthy there would be fewer jobs than we currently have and I'm certain quite a few charities, grants, and scholarship programs wouldn't exist. Why is it that the United States (a relatively young county compared to many other countries around the world) has been able to become an economic leader? Could the answer be Capitalism? How is it that the United States has lead the world in most technological advances? Could the answer be Capitalism? Why do so many want to come to the United States? Could it be Capitalism once again? And who has benefited from what we've created? Let's try everyone - including you. If it weren't for our advancements in medicine & technology most people's lives would be much shorter and unpleasant. The reason why much of this happened in the United States is due Capitalism. Those concepts of risk & reward and that being successful is a good thing. If you, the government, or people like you dictate how successful a person is permitted to be, I think you'll find we'll begin to resemble the places that immigrants are coming from.
This is what's wrong with the core of the us economy. I just read "markets jump on a growth in China".
Keep on growing China!! Build and manufacture all of our stuff! While all of are unemployed Americans sit watch unemployment stayat 9-10% for a long time in the US. Heck we should have them build our houses to and ship them over to.
To lostonearth - Great name - you really are lost. Get a clue. Why should someone who has more money (for whatever reason) be forced to pay a higher percentage of their income? So someone who does nothing can benefit? Having a graduated income tax is just as bad as having to pay more in property tax because you're perceived house value is higher than your neighbors. Lostonearth and others with similar views must be progressives. They are enlightened and know more than us. It's also obvious that they voted for Obama and agree with forcing socialized healthcare down our throats. I have a great idea. Why don't all of you go to Mexico or Canada or some other foreign country and try to set up your own socialist country. This country was founded on the principles of individual responsibility and is a Republic - remember the Pledge of Allegiance?
Next time buy 96 feet. You get your boat top and your special favors. No problem, fortunately aluminum is still fairly inexpensive. Austinetic stainless, copper, and brass (stuff that we use at my "day job") are all way up from their lows.
1/4 inch wall. Is she trying to protect them from a hurricane?
That's why we need to go to the fair tax. It's all in the prebates.
So you economically 101 challenged want the person making $10,000 a year and the person making 1 million a year to both pay their share,... like 10% perhaps? With that percentage, that would leave the person making $10,000 a year left with $9,000 to struggle and make ends meet for the whole year and forget about owning a home, a business, a car, any type of insurance, any health care, any dental plan, any college tuition, any stocks, or any minor repairs for anything for that matter,..... while the other poor soul that makes 1 million pays their 10% on their 1 million yearly income, leaving them with only $900,000 a year to survive on. How will they ever be able to pay their bills? Boo Hoo!
What's wrong with this picture? Something the greedy rich imbeciles will never understand. Stupidity at it's finest! A no brainer on why the rich get richer and the poor get nothing but crumbs, frustration and increased anger with each passing day. When the Revolution breaks out, the rich cowards will run and retreat to their private islands and fortresses. Once there's nothing left to steal from the poor U.S. folks, the rich will just move to Africa and start raping, abusing and destroying that continent. Oh wait, they already are in some countries. Enjoy your billions and trillions in heaven you perverted and insane scum of the Earth!
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[BRIEFING.COM] The S&P 500 ended this week with a bang, roaring to a new all-time high on the back of stronger-than-expected economic data, influential leadership, and an ongoing appreciation for the Fed's monetary policy support.
The bullish bias was evident in premarket action as the S&P futures pointed to a higher start without the benefit of any definitive news catalyst. Stocks indeed benefited from a blast of buying interest at the opening bell on this ... More
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