Daily Market Brief for March 29, 2007
Stocks threw off losses to close higher. They were bolstered by news of an unexpected upward revision to fourth-quarter growth as investors looked past a rise in crude oil prices above $66 a barrel. It is evident that the process of rallies and pull-backs would continue for some months.
Today, the Dow Jones industrial average closed up 48.39 or 0.37% to 12,348.75, the broader S&P 500 closed up 5.30 or 0.39% to 1,422.53, and the Nasdaq composite closed down 0.78 or 0.03% to 2417.88.
Market breadth was positive. On the New York Stock Exchange, winners beat losers 5 to 3 on volume of 1.509 billion shares. On the Nasdaq, advancers topped decliners by a narrow margin on volume of 1.943 billion shares.
The final read on fourth quarter GDP indicated moderately strong U.S. economic growth than previously thought, primarily because businesses added more to inventories than was estimated a month ago. GDP rose at a 2.5% annual rate instead of 2.2%. There was also a drop in the number of Americans filing new claims for unemployment last week. The number of U.S. workers filing new claims for jobless benefits dropped to a seasonally adjusted 308,000 from an upwardly revised 318,000 the prior week. Analysts were expecting claims to edge up to 320,000.
Stock of Boeing Co. (NYSE: BA) gained 0.4% after Colombia's largest airline, Avianca SA, said it would buy 10 of Boeing's 787 Dreamliner aircraft. Avianca SA will spend $1.5 billion to replace its aging aircraft. The company also plans to buy another 35 airplanes with an additional investment ranging from $1.2 billion to $1.5 billion.
Sprint Nextel Corp. (NYSE: S) was shut out of the first part of a two-part federal contract that could reach $48 billion over 10 years. However, Sprint could win a share of the U.S. government's upgrade when the second part of the contract is issued in May.
Shares of U.S. Steel (NYSE: X) closed up $3.61 or 3.4% to $101.22, on news that it is buying Lone Star Technologies (NYSE: LSS) in a deal worth $2.1 billion in cash. Stock of Lone Star Technologies closed up $17.66 or 37% to $66.11. U.S. Steel will pay $67.50 a share, a 39% premium to Wednesday's closing price.
U.S. light crude oil for May delivery rose $1.95 to settle at $66.03 a barrel on the New York Mercantile Exchange, a gain of 3%. Prices have been on the rise recently amid worries about the conflict with Iran.
