S&P 500 hits 5-year high

But American Express may depress markets Friday after announcing 5,400 job cuts. The Dow finishes up 81, and the market gains so far could mean a decent year for stocks -- if the debt ceiling crisis doesn't derail things.

By Charley Blaine Jan 10, 2013 6:56PM
(© Photodisc/SuperStock)Stocks moved higher on Thursday as  the Standard & Poor's 500 Index ($INX) finished at a new five-year high.

The market has had a strong-enough start to 2013 that those who watch things like the "January effect" believe stocks have a decent shot at moving higher for the year.

The question for Friday is how the market reacts to American Express' (AXP) announcement late Thursday that it will cut 5,400 jobs -- about 8.5% of its workforce -- and take hundreds of millions of dollars in charges for the fourth quarter. Wells Fargo (WFC) also reports results before the open.

The S&P 500 finished the day up 11 points to 1,472, its best finish since Dec. 28, 2007. It is within 94 points of its all-time closing high of 1,565, set on Oct. 9, 2007. The Dow Jones industrials ($INDU) were up 81 points to 13,471, while the Nasdaq Composite Index ($COMPX) added 16 points to 3,122.

The major averages were up for the second day in a row and fifth in the last eight sessions.

According to the Stock Traders Almanac, an up year for the S&P 500 has been accompanied by a rise in the index in the first five trading days of the year about 85% of the time.

The fifth day was Tuesday, and the three major averages were higher. They've risen four of the first seven trading days of the year and are now up 3% for the month.

Admittedly, this may be no more than simple coincidence. Moreover, it's also true that the market faces considerable head winds, most notably the debt ceiling crisis that requires Congress to pass legislation raising the nation's debt ceiling or run the risk of shutting the government down.

American Express put a damper on the enthusiasm with its surprise earnings report. It wasn't scheduled to report results until Jan. 17. Shares were off 64 cents to $60.15 after hours. The stock had closed up 53 cents to $67.09 in regular trading.

Because of the job cuts, American Express expects to end 2013 with 4% to 6% fewer employees. It has 63,500 employees now.

The company took a $400 million charge to fourth-quarter earnings. That cut profits to $637 million, or 56 cents per share. Excluding the charges, the company would have earned $1.2 billion, or $1.09 per share, beating the Street estimate of $1.06 a share.

The market moved higher on Thursday thanks in large part to reports of  growing exports from China. Financial, energy and telecom stocks were the market leaders.

Bank of America
(BAC), up 35 cents to $11.78, was the top percentage gainer among the 30 Dow stocks.

Exxon Mobil
(XOM) and Chevron (CVX) contributed 14.5 points to the Dow gain as energy prices moved higher.

Crude oil (-CL) moved up 72 cents to $93.82 a barrel in New York and is up 2.2% month. Gold (-GC) jumped $22.50 to $1678 an ounce.
9Comments
Jan 11, 2013 3:47AM
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If I let Miss Lilly take $500 to the store for food,$300 comes back in our pet's food, and $200 for us.
Jan 11, 2013 3:43AM
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I'm pretty sure ALL ex-Presidents have Secret Service with them, unless they demand they be excused...??

 

Where do you get or come up with this bullshidt...Don't you like black guys ??

Jan 11, 2013 3:33AM
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I will be first to admit, didn't read Charley's whole spiel,; Didn't have to, because it's usually okay by me..

 

I had a busy day afternoon, with dentist and wife's stuff, then had to take a breather at a casino.

 

Drives me wild all this D&G shidt, it was a fantastic day...Goldminers, huge jump over 4%.

And Ford how sweet was that..?

And many went up 1.5 - 2.5%, absolutely nothing wrong with that...

Either some/many of the commentors are not investing or just want to bring wearisome crap to the board...This is where some of the big boys play.....And come to learn or pick up a few wise tidbits.

The f*kin gloom shidt and politics is just a distraction to someone with half a brain..

It's over with, move on, move forward and/or get the fk out of the way. 

Jan 11, 2013 1:16AM
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Better then the days when the down was around 6500.  A long road getting here. but loving it now-- glad I stayed in and hold.
Jan 10, 2013 9:36PM
Jan 10, 2013 9:35PM
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LIFETIME SECRET SERVICE PROTECTION FOR PRES.SIGNED INTO LAW,HMMMMMM,I GUESS KING OBAMAS GETTING A LITTLE NERVOUS HUH?TSK,TSK.     PS.I WONDER WHAT THAT WOULD COST?

Jan 10, 2013 7:24PM
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Very nice and accurate summary of today's transactions and future trends.
Jan 10, 2013 7:14PM
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Such a spectacular day for stocks!  Wait, how many shares were traded again?  DOH!

Just like giving your wife $500 to go buy groceries for the month, and her spending all of it on 2 oz of caviar.  Yes, technically she bought $500 worth of food, but C'MON MAN!

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