Dow up 67 as stocks see relief from Thursday loss

The blue chips fall 1% for the week; tech stocks move higher. Financial stocks, led by JPMorgan Chase, rally after Moody's downgrade. Oil and gold are higher. Facebook jumps 10.1% on the week. Research In Motion falls under $10.

By Charley Blaine Jun 22, 2012 12:37PM
Charley BlaineUpdated: 6:29 p.m. ET

Powered by a surprising surge in financial stocks, the stock market enjoyed a solid rally today that pushed technology stocks higher for the week and very nearly pulled the entire stock market into the black as well.

The rally was helped by leaders of Germany, France, Italy and Spain agreeing to put together a package of tools to promote growth in the European economy. There are differences enough among them, however, that a summit next week of all the eurozone countries could prove difficult.

Financial stocks moved higher after Moody's Investors Service downgraded its ratings of 15 of the world's largest banking companies. The group includes JPMorgan Chase (JPM), Bank of America (BAC), Citigroup (C), Morgan Stanley (MS) and Goldman Sachs (GS). Moody's had warned in February that the downgrades were coming, but they weren't as bad as expected. JPMorgan was the best performer of the U.S. members of the group, up 48 cents to $35.99. The stock was up 3.1% this week and is 8.9% higher for the month.

Meanwhile, stocks in Asia and Europe were lower, reflecting Thursday's U.S. losses. Crude oil (-CL) in New York and Brent crude in London were higher even the dollar rose against the euro. Gold (-GC) moved higher as well.

The Dow closed up 67 points to 12,641. The Standard & Poor's 500 Index ($INX) gained 10 points to 1,335, and the Nasdaq Composite Index ($COMPX) gained 33 points to 2,892. The Nasdaq-100 Index ($NDX), heavily influenced by Apple (AAPL), climbed 29 points to 2,586. Apple was up $4.43 to $582.01.

Article continues below.
For once, Europe helped the market.

Late in the day, Italy, France, Spain and Germany agreed to push European leaders at a key summit next week to sign off on a €130 billion ($163 billion) euro plan aimed at increasing growth in Europe's beleaguered economies.

The agreement, which came during a summit in Rome, is a victory for the leaders of Italy, France and Spain, The Wall Street Journal noted. For months, they've been trying to convince Germany, Europe's strongest economy, that the region needs a plan to boost growth and offset the wave of austerity measures countries are taking to fight the debt crisis.

Meanwhile, Research In Motion (RIMM) shares fell 21 cents to $9.86, their first close below $10 since December 2003. Credit Suisse analyst Kulbinder Garcha said the company may miss Street estimates when it reports fiscal-first-quarter earnings after Thursday's close.

Markets for the week



6/22/2012

6/15/2012

% chg.

YTD chg.
Dow Industrials

12,640.78

12,767.17

-0.99%

3.46%
S&P 500

1,335.02

1,342.84

-0.58%

6.16%
Nasdaq 

2,892.42

2,872.80

0.68%

11.03%
Russell 2000

775.16

771.32

0.50%

4.62%
Crude oil 

$79.76

$84.03

-5.08%

-19.30%
(per barrel)

0.00

0.00

0.00%

0.00%
U.S. Dollar Index 

82.44

81.97

0.58%

2.38%
10-yr. Treasury

1.67%

1.59%

5.36%

-10.64%
Gold

$1,566.90

1,628.10

-3.76%

0.01%

Crude oil and gold move higher
Crude oil in New York settled up $1.56 to $79.76 a barrel after falling to $78.20 in New York on Thursday. Brent crude was up $1.77 to $91 a barrel.

The national average price of unleaded gasoline was $3.454, down from Thursday's $3.472, according to AAA's Daily Fuel Gauge Report. For the week, the price is off 2%, and it's down 12.3% from its April high of $3.936 a gallon.

Gold settled up $1.40 to $1,566.90 an ounce. Silver (-SI) was off 17.8 cents to $26.661 an ounce, but copper (-HG) settled up slightly to $3.306 a pound. For the week, gold was down 3.8%, with silver down 7.2% and copper down 2.3%. Gold is even for the year, with copper down 3.8% and silver off 4.5%.

Interest rates were higher, with the 10-year Treasury yield rising to 1.672% to 1.618% on Thursday.

Energy prices -- New York close



Fri

Thur.

Month chg.

YTD chg.
Crude oil (-CL)

$79.76

$78.20

-7.82%

-19.30%
(per barrel)











Heating oil (-HO)

$2.5320

$2.5231

-6.33%

-13.12%
(per gallon)











Natural gas (-NG)

$2.6250

$2.5820

8.38%

-12.18%
(per mil. BTU)











Unleaded gasoline (-RB)

$2.4676

$2.4520

-9.37%

-7.14%
(per gallon)











Brent crude 

$90.98

$89.23

-10.69%

-15.27%
(per barrel)











Retail gasoline

$3.4540

$3.4720

-4.59%

5.43%
(per gallon; AAA)












The Dow, S&P end week lower; Nasdaq to end with a gain
The market ended the week, well, mixed. The Dow was off 1% for the week, with gains for JPMorgan Chase, Merck (MRK) and Microsoft (MSFT) offset by losses in Hewlett-Packard (HPQ), Procter & Gamble (PG) and Chevron (CVX). (Microsoft publishes MSN Money.)

The S&P 500 finished with a 0.6% loss. Health care, financial and technology stocks were higher, but energy and utility shares are lower. Airline stocks were among the top-performing groups thanks to lower oil prices.

The Nasdaq and Nasdaq-100 finished up 0.7% and 0.6%, respectively. Not bad considering Thursday's smackdown. Vertex Pharmaceuticals (VRTX) and DirecTV (DTV) were the top Nasdaq-100 performers for the week, up 7.2% and 5.8%, respectively. Nvidia (NVDA), whose chips are key to the success of many tablet devices, was the third-best Nasdaq-100 performer, up 5.7%. The shares were up 16 cents today to $13.

Let us note that Facebook (FB), up $1.21 today to $33.05, gained 10.1% on the week. It is still down 13% from its $38 offering price when it went public in mid-May.

With a week to go, June is holding up as a winner for stocks. The Dow is up 2%, with the S&P 500 up 1.9% and the Nasdaq up 2.3%. The overall strength comes despite the two worst losses of the year: on June 1, when the Dow fell 275 points, and Thursday's dive.

For the year, the Dow is up 3.5%, with the S&P 500 up 6.2% and the Nasdaq up 11%.

The ratings themselves get lousy reviews
The prospect of downgrades had weighed on banks since Moody's said Feb. 15 it was reviewing 17 banks with capital-markets operations because of fragile confidence and tighter regulations that pinched revenue. Pressure mounted as Europe's sovereign-debt crisis intensified. The group didn't peak until the end of March, however.

JPMorgan Chase fell 33% between March 28 and June 1 -- and is up 16% since then. Much of the fall was related to the big trading loss that developed as it tried to hedge against a decline in European financial markets.

The Moody's ratings cuts are "a mea culpa from 2007 and 2008," James Leonard, a credit analyst at Morningstar, told Bloomberg News. "The banks have gotten so much better in the last few years in terms of capital, yet their ratings keep going down. What does that tell you? That the ratings were so wrong before."

Of the fifteen banking companies, the French banks were the best performers today, with Society Generale (SCGLY) up 15 cents to $4.47, BNP Paribas (BNPQY) up 49 cents to $18.55, and Credit Agricole (CRARY) up 8 cents to $2.09.

Leaders and laggards
Darden Restaurants (DRI), operator of the Olive Garden and Red Lobster chains, slid 35 cents to $50.04. Fiscal-fourth-quarter revenue trailed analysts’ estimates because of an unexpected decline in sales at the company’s older restaurants.

First Solar (FSLR) jumped $1.34 to $15.88, tops among S&P 500 stocks, The largest maker of thin-film solar panels received permission to continue construction on a $1.36 billion power project in Los Angeles County.

Monster Beverage (MNST) was down $1.13 to $73.61. The distributor of energy drinks and fruit juices will replace Sara Lee (SLE) in the S&P 500.

Ryder System (R), the U.S. truck leasing company, fell $5.31 to $35.44. The company cut its full-year earnings forecast because of lower demand for commercial rentals.

Twenty-six of the 30 Dow stocks were higher, led by Microsoft, Merck (MRK) and Bank of America. Wal-Mart Stores (WMT) and Kraft Foods (KFT) were the laggards.

Caterpillar (CAT), closely watched because of its exposure to economic forces overseas, was off two cents to $84.96 but fell 2.3% on the week and is off 20% this quarter.

First Solar, Tripadvisor (TRIP) and Southwestern Energy (SWN) were the S&P 500 leaders, with Ryder, Macy's (M) and cruise-line operator Carnival (CCL) the laggards. A total of 384 S&P 500 stocks were higher.

Life Technologies (LIFE) and Vertex were the Nasdaq-100 leaders; 95 stocks in the index were higher. The laggards were Research In Motion and Monster Beverage.

Short hits from the markets -- New York close



Fri

Thur.

Month chg.

YTD chg.
Treasury yields











13-week Treasury bill

0.0800%

0.070%

14.29%

700.00%
5-year Treasury note 

0.751%

0.725%

11.92%

-9.52%
10-year Treasury note

1.672%

1.618%

5.76%

-10.64%
30-year Treasury bond

2.756%

2.688%

3.14%

-4.60%
Currencies











U.S. Dollar Index

82.442

82.488

-0.83%

2.38%
British pound

1.5596

1.5603

1.19%

0.37%
(in U.S. $)

 








U.S. $ in pounds

£0.641

£0.641

-1.17%

-0.37%
Euro in dollars

$1.26

$1.26

1.71%

-2.97%
(in U.S. $)

 








U.S. $ in euros

€ 0.795

€ 0.797

-1.68%

3.06%
U.S. $ in yen 

80.65

80.22

2.66%

4.60%
U.S. $ in Chinese

6.39

6.36

0.10%

0.98%
yuan











Canada dollar

$0.977

$0.973

0.83%

-0.46%
(in U.S. $)

 








U.S. dollar 

$1.025

$1.028

-0.83%

0.46%
(in Canadian $)

 








Commodities

 

 

 

 
Gold (-GC)

$1,566.90

$1,565.50

0.17%

0.01%
(per troy ounce)

 








Copper (-HG)

$3.306

$3.298

-1.77%

-3.78%
(per pound)

 








Silver (-SI)

$26.6610

$26.8390

-3.95%

-4.49%
(per troy ounce)

 








Wheat (-ZW)

$6.7325

$6.6175

4.58%

3.14%
(per bushel)

 








Corn (-ZC)

$5.910

$5.865

6.44%

-8.58%
(per bushel)

 








Cotton 

$0.7417

0.7817

3.66%

-19.10%
(per pound)

 








Coffee

$1.5590

1.588

-4.33%

-32.11%
(per pound)

 








Crude oil (-CL)

$79.76

$78.20

-7.82%

-19.30%
(per barrel)










 

68Comments
Jun 22, 2012 2:25PM
avatar

The Abortion Conspiracy

 

I've always found it strange that a group squeamish about water boarding terrorists seems comfortable  snuffing out life in the womb.

Jun 22, 2012 3:42PM
avatar
Relief for the CROOKS? What about us Tax Payers?
Jun 22, 2012 1:32PM
avatar
Yet another reason why no-one should trust the markets nor these banks. Their ratings do down, their share prices go up. Makes sense. Europe is crumbling, even Germany now and US banks buy billions of Euro (read JUNK) bonds. Makes sense. GS publicly say BUY and privately say SELL. A rebound rally? Is that supposed to be a joke?
Jun 22, 2012 3:44PM
avatar

kind of getting off the subject for this blog aren't we???  neither party realy wants this as an issue!!!!! stick to what is at issue  the state of affairs of our country!!!!!!! an why congress can not work together to fix our damn problems with out calling each other names LIKE SCHOOL CHILDREN.

  we are supposed to have judges appointed to take care of issues that arrise, let them do their job.

Jun 22, 2012 12:50PM
avatar
You read the headline: Stocks Get Some Relief After Thursday's Big Loss...

and think to yourself-- who would be dumb enough to chase slightly sold off stocks just before the big correction? Then you answer it yourself... oh yea, banks.

Jun 22, 2012 2:15PM
avatar

The Moody's ratings cuts are "a mea culpa from 2007 and 2008," James Leonard, a credit analyst at Morningstar, told Bloomberg News. "The banks have gotten so much better in the last few years in terms of capital, yet their ratings keep going down. What does that tell you? That the ratings were so wrong before."

Yeah and if wasn't for Bernanke the banks would still be bad. They still have toxic assets marked to full value, their income is from zero interest loans from the Fed that the banks take right to the trading desk and run the stocks up.  What the SEC and bank regulators should be telling these banks is that they have three years to show their true balance sheets with actual mark to market assets and get their balance sheets in order.  Those banks that haven't made it in three years will be busted up and spread out among smaller regional banks.  If this had been done in 2008 instead of too big to fail bailouts the economy would actually be in a recovery.

Jun 22, 2012 3:30PM
avatar
I said it yesterday that the DOW would be up today and it is...crash 250 then the next day ohh it is not that bad in the Euro Zone or so and so comapany has some earnings, DOW goes up..Wall Street is rigged more than ever no real markets,... has the Euro Zone fixed its problems...NO...will the Federal Reserve keep pumping fiat dollars into a failing system.... YES... is the Dollar being replaced...YES
Jun 22, 2012 3:57PM
avatar

Nothing more than a 'rally-cry PUMP' from within the financial industry in ANOTHER attempt to plea to the public into not fleeing Wall St.

 

Pathetic doesn't even describe this ruse.

Jun 22, 2012 3:01PM
avatar
King obama has nominated R.Griffin to the NLRB

 this man has ties to the Gambino, and Colombo crime organizations

 he should fit right in at the White House
Jun 22, 2012 4:36PM
avatar
How can these 15 largest banks be downgraded and the stockmarket and the american banks just pretty much laugh it off. This just does not make sense when you think about how much "money" is being pumped into the system to make all of us believe it is a healthy system. We all feel that something is not right but it's hard to pin down just one thing when so much is screwed up. Does no one see a problem with this. Everyone have a great day and never stop asking questions.
Jun 22, 2012 2:13PM
avatar
I think abortion might have been ok for you
Jun 22, 2012 2:01PM
avatar
I believe the technical term is "Dead Cat Bounce"...
Jun 22, 2012 2:49PM
avatar
Next week should have a monster rally in stocks as Obamacare is struck down.  
Jun 22, 2012 2:37PM
avatar
"Dead Cat Bounce"

Most people agree that the word "bounce" is no longer applicable. There must be a spine for a bounce. Wall Street- no spine, plenty of jelly. Thus, this is a dead cat "gush", today. That said, we here at least have some pro-activity in our investing. Sadly, Ben said "no cash" so all the pumping being done today comes from regular folks still trusting Wall Street and banks with their future. Personally, I'm investing in tin cups and pencils, perhaps some apples (not Apple) too. There will be a lot of destitute people on the street corners soon. Awakened when the cat goes pop and they find out they are the weasel.

Put your car on cruise control but stay awake and keep your foot near the brake pedal. Keep your cash in manual and use the gear shift and the brakes as need requires. AWAKE. That's the key.
Jun 22, 2012 3:12PM
avatar

Hey Endeavor!  "unwanted babies?  REALLY?  We're not talking about an old pair of jeans here, we're talking about a REAL human life.  You would have an abortion for the slightest inconvenience ie: wasn't "planned", "not a good time now", "other things going on now"  and the list goes on. 

 

I bet if this was a suspected terrorist, we'd never hear you stop screaming if we had to interrogate the terrorist and his "civil rights" were being violated. 

Jun 22, 2012 4:30PM
avatar
Stocks got some relief, but standby, Monday they will think of a way to take it all back and more.
Jun 22, 2012 3:13PM
avatar
some peoplle arent mentally developed
Jun 22, 2012 3:23PM
avatar

GU

 

I believe that  one is responsible for one's actions. 

 

Now I admit there's a bit of wiggle room in discussing the justification for  putting folks to death....criminals, terrorists, soldiers, innocent bystanders, etc.. 

 

What reason(s) can you suggest for putting a fetus to death & what actions by the unborn would justify the act? 

 

 

Jun 22, 2012 3:01PM
avatar
Endeavor,

You forgot to mention that in their belief that that an embryo/fetus is a human and therefore should not be killed yet they believe that a a fully developed human can be put to death by others.
Jun 22, 2012 4:56PM
avatar
"the stock market and the American banks just pretty much laugh it off"

I don't think so. I think they wept their way home. It's all banks in all countries. Somebody wanted us to stay in the 20th Century forever. Nothing lasts forever. Bankers didn't realize it when they agreed to this scam. They know it now and there is no place on Earth where they can hide. These are not our best or brightest, just our greediest and most unethical. 
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