Investors shrugged off disappointing domestic data as energy and technology boosted the indices to highest levels since Libyan violence started dampening the markets last month. However, volumes once again remained low and reflected investor cautiousness ahead of earnings results.
The Dow Jones Industrial Average (DJIA) and the Standard & Poor 500 surged 0.7% each, closing at 12,279.01 and 1,319.44, respectively. The Nasdaq Composite Index inched up by a percentage point and finished the day at 2,756.89. Volumes have been particularly low for the past few days and the situation was no different on Wednesday with only 3.6 billion shares changing hands on the New York Stock Exchange. On the NYSE, more than two stocks advanced for every declining stock.
TheS&P and Case-Shiller Index reported a slide in the home prices and the report subsequently affected housing stocks. The Case-Schiller Composite 10 City index (C-10) fell 0.22% on a seasonally adjusted basis, and is down 2.03% from a year ago. The broader Composite 20 City index (which includes the cities in the C-10) also fell by 0.22% over the month and is down 3.03% from a year ago. Only eight of the twenty cities advanced on a monthly basis while the rest slipped lower. On a yearly basis, only two managed to move up and left the rest on the losing side.Washington DC had the strongest gain with prices up 3.59% from a year ago. San Diego followed with a 0.08% increase. This is the seventh straight month-to-month decline in the composites and the third straight month that both of the composites came in negative on a year-over-year basis. Seven cities hit new post bubble lows in their home prices. Sectoral shares such as DR Horton Inc. (NYSE:DHI) (1.7%), KB Home (NYSE:KBH) (1.9%), Ryland Group Inc. (NYSE:RYL) (1.8%), Toll Brothers Inc. (NYSE:TOL) (0.2%), and Standard Pacific Corp. (NYSE:SPF) plunged 1.7%, 1.9%, 1.8%, 0.2% and 2.4%, respectively.
Separately, The Conference Board reported a drop in the consumer-confidence index to 63.4 in March from the revised 72.0 last month. The fall is a turnaround after five consecutive months of increases and rising gas prices contributed somewhat to the decline. However, the decline was better than what the economists had feared and thus the markets were not affected negatively.
It was also an uneventful day on the global front as no new developments concerning the Japan crisis emerged. Neither was there any fresh set of news about euro-zone debt concerns that could affect the indices. These factors had been the driving forces behind the movement of the indices along with Middle East turmoil.
Talking of the Middle East, it is speculated that there is a larger need of drilling in Saudi Arabia than earlier estimates as oil reserves might be limited. Both oil prices and related indices continued to move up. On the New York Mercantile Exchange, crude oil prices settled at $104.79 per barrel after gaining 81 cents. The NYSE Arca Oil Index, NYSE Arca Natural Gas Index and The Philadelphia Oil Service Index surged 0.8%, 0.4% and 1.9%, respectively.Rowan Companies Inc. (NYSE:RDC) (5.2%), Pioneer Natural Resources Co. (NYSE:PXD) (2.9%) and Schlumberger Limited (NYSE:SLB) (4.4%) gained 5.2%, 2.9% and 4.4%, respectively. Japan’s nuclear crisis is also pushing up energy stocks as a whole and Halliburton Company (NYSE:HAL), Chevron Corp. (NYSE:CVX) and Transocean Ltd. (NYSE:RIG) moved ahead.
The technology sector also drove the broader markets following an announcement by Amazon.com Inc. (NASDAQ:AMZN) about its new cloud based music service. The stock surged a significant 3.1% as also did the other tech stocks. Among the gainers, Juniper Networks, Inc. (NYSE:JNPR), Yahoo! Inc. (NASDAQ:YHOO) and Google Inc. (NASDAQ:GOOG) all garnered significant increased.
Investors who had shown resistance and kept the market volumes low for a few days now await important reports scheduled for later this week. Private sector payroll data, initial jobless claims, nonfarm payroll data and manufacturing data reports are slated for release. The markets’ performance for the week is now highly dependant on this data unless another global issue creeps in to swing indices either way.