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The Dow Jones and the S&P 500 finished in the green, closing at five-year highs prior to President Barack Obama’s State of the Union address. The Dow is nearly 1% shy of its all-time closing high achieved in October 2007. Better-than-expected-results from a couple of consumer companies also boosted market sentiment. Financials emerged as the biggest gainer for the top ten S&P 500 industry groups while the technology sector was the major loser.
The Dow Jones Industrial Average (DJI) gained 0.4% to close the day at 14,029.30. The S&P 500 increased marginally, by 0.2%, to finish yesterday’s trading session at 1,520.35. The tech-laden Nasdaq Composite Index fell 0.1% to end at 3,190.09. The fear-gauge CBOE Volatility Index (VIX) decreased 2.3% to settle at 12.64. Consolidated volumes on the New York Stock Exchange, American Stock Exchange and Nasdaq were roughly 5.7 billion shares, well below the daily average of 6.45 billion shares in 2012. Advancing stocks outnumbered the decliners on the NYSE. For 62% stocks that advanced, 34% declined.
The markets witnessed mixed reactions from investors ahead of President Barack Obama’s speech and earnings results. However, at the end of the trading session, the S&P 500 and the Dow finished at five-year highs. The Dow finished yesterdays trading session above the 14,000 level mark. This is the second time this month that the Dow has closed above this level. Apart from February 2013, the Dow has finished above this level nine times in its history, once in July 2007 and eight times in October 2007.
The biggest mover of Tuesday’s markets was the State of the Union speech. Many expectations are to be linked with his speech, due late on Tuesday. The President is expected to focus on creating middle-class jobs, bolstering the economy and favoring clean energy. He is also expected to emphasize the huge investments needed in infrastructure.
Meanwhile, shares of consumer giant Avon Products, Inc. (NYSE:AVP) jumped 20% after it posted results for the fourth quarter that beat the Street’s expectations. Earnings of construction major Masco Corporation (NYSE:MAS) beat estimates following which the company’s shares surged almost 12.5%. The company issued guidance saying it expects robust growth in the house construction segment in fiscal 2013.
Shares of the world’s largest beverage company, The Coca-Cola Company (NYSE:KO) declined 2.7% after revenues clocked in marginally below the Street’s expectations. However, earnings rose 13% year over year. The revenue was adversely affected due to the sluggish economies of Europe and China. Sales decreased in Europe and China by 5% and 4%, respectively.
Apparel major Michael Kors Holdings Ltd (NYSE:KORS) reported robust results for fiscal third quarter 2013. Sales for the quarter increased 41.4% year over year, easily beating earnings and revenue expectations. Shares of the company increased 8.8%. For fiscal fourth quarter 2013, the company has guided revenues within the range of $515 million to $ 525 million.
Among the top ten S&P 500 groups, financial stocks emerged as the biggest gainer. Financial stocks such as JPMorgan Chase & Co. (NYSE:JPM), Berkshire Hathaway Inc. (NYSE:BRK.B), Wells Fargo & Company (NYSE:WFC), Bank of America Corp (NYSE:BAC) and Citigroup Inc. (NYSE:C) gained 1.0%, 0.6%, 0.7%, 3.3% and 2.8%, respectively.
Technology stocks were the major loser among the S&P 500 groups. The Technology SPDR (XLK) declined 0.3%. Stocks such as Apple Inc. (NASDAQ:AAPL), International Business Machines Corp. (NYSE:IBM), Google Inc (NASDAQ:GOOG), SanDisk Corporation (NASDAQ:SNDK) and Avid Technology, Inc. (NASDAQ:AVID) lost 2.5%, 0.1%, 0.2%, 0.5% and 0.6%, respectively.