Stock Market News for September 10, 2009

U.S. stocks jumped to their highest level in almost a year after Federal Reserve’s Beige Book survey said the economy is showing signs of stabilization.  Although shares closed off their session highs, the report was enough to lift sentiments on the Street.  However, the report did indicate that labor markets are weak and retail sales are not picking up.  Industrial shares rallied after Goldman Sachs raised its view on the U.S. multi-industry group, noting the industrial activity is picking up.  Treasuries made a partial comeback after the government’s 10-year note auction witnessed a strong response.

The greenback remained near its year lows against a basket of currencies while gold prices eased a little to settle at $995.30.  Crude prices were slightly up ahead of the September OPEC meeting.

The Dow Jones industrial average, which rose as much as 80 points earlier in the session, pared some gains to close at 9,547.22, up 49.88 points.  The broad S&P 500 index advanced 7.98 points, or 0.78%, to close at 1,033.37, its best finish so far this year, and the tech-heavy NASDAQ rose 22.62 points, or 1.11%, to close at 2,060.39.  On the NYSE, volume was a moderate 1.24 billion shares as advancing stocks outpaced those that fell seven to three.

Even as unemployment levels continuing to remain vexing, the Fed’s Beige Book revealed “signs of improvements” in 11 of the 12 districts.  Meanwhile, OPEC also exited its monthly meeting with soothing words, leaving production levels unchanged, and asserting current prices were within their desirable range.  Nevertheless, fears of a jobless recovery have given rise to worries that the economic recovery might be reversed after inventory builds and government assistance end.

Apple (NASDAQ:AAPL) shares declined even as CEO Steve Jobs made a much-awaited comeback after his almost six-month long medical leave.  The company announced the launch of new products and slashed prices of existing iPod Touch models.  SanDisk (NASDAQ:SNDK) jumped 6.1% to $19.32, its highest close in 11 months; Palm (NASDAQ:PALM) shares declined more than 8.7% after the company announced the launch of its Palm Pixi phones.  The stock was downgraded by Credit Suisse to “neutral” from “outperform.”   

Among the S&P500 industry groups, nine recorded gains with industrials (+1.5%) and financials (+1.4%) topping the list.  Among the industrial conglomerates, General Electric (NYSE:GE) advanced 2.6% to $14.87, its highest level since January and Illinois Tool Works (NYSE:ITW) jumped 5% to $43.93.  Goldman (NYSE:GS) raised Illinois Tool Works (NYSE:ITW) to “conviction buy” from “neutral.”  Caterpillar (NYSE:CAT) rose 3.1% to $48.41.  GE also benefited from an analyst upgrade from JP Morgan (NYSE:JPM), and a hiked price target from Goldman Sachs (NYSE:GS).  Boeing (NYSE:BA) shares added 2.1% following the firm's projection of a return to growth in global air traffic next year.  United Technologies (NYSE:UTX), which rose 1.4%, was also upgraded by Goldman Sachs (NYSE:GS).  3M (NYSE:MMM) rose 2.1%

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