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Stock Market News for April 1, 2013

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Benchmarks finished the last trading session of the month on a positive note. The S&P 500 finally managed to post a new all time high on Thursday. Meanwhile, the number of Americans filing for unemployment benefits increased in the previous week. GDP data revealed that the U.S. economy expanded more than earlier estimated. Utilities stocks were the biggest gainers among the S&P 500 industry groups whereas the energy sector was the only loser.      

The Dow Jones Industrial Average (DJI) gained 0.4% to close the day at 14,578.54. The S&P 500 added 0.4% to finish Thursday’s trading session at 1,569.19. The tech-laden Nasdaq Composite Index rose 0.3% to end at 3,267.52. The fear-gauge CBOE Volatility Index (VIX) declined 3.4% to settle at 12.70. Consolidated volumes on the New York Stock Exchange, American Stock Exchange and Nasdaq were roughly 5.8 billion shares, significantly lower than 2012’s daily average of 6.45 billion shares. Advancing stocks outnumbered the decliners. For the 61% that advanced, 35% declined.

The S&P 500 not only touched a new all time high but also finished in the green for the fifth month in a row. Benchmarks have enjoyed a decent rally in the first three months of the year. The S&P 500 gained 10.0%, the Dow Jones surged 11.3% and the Nasdaq added 8.2% over the first three months of 2013. U.S. markets were closed on Friday due to the Good Friday holiday. The blue-chip index gained 3.7%, the S&P 500 increased 3.6% and the Nasdaq climbed 3.4% in the month of March.       

According to the U.S. Department of Labor initial claims increased in the previous week. The report revealed that number of Americans filing for unemployment benefits increased 16,000 to 357,000 from the prior week’s revised figure of 341,000. This was above the consensus estimate of 340,000. The four-week moving average also increased 2,250 to 343,000 from the previous week's revised average of 340,750.   

On Thursday, the U.S. Department of Commerce reported that the U.S. economy expanded more than previously estimated in the fourth-quarter. According to the “third” estimate real gross domestic product increased 0.4% annually in the fourth-quarter against the previous estimate of 0.1%. But this was below the consensus estimate of 0.5%. Increase in real GDP in the fourth-quarter was boosted by positive contributions from personal consumption expenditures (PCE), nonresidential fixed investment, and residential fixed Investment.
Additionally, another discouraging domestic report was released on Thursday. The Chicago PMI’s Chicago Business Barometer declined to 52.4 in March from previous month’s figure of 56.8. This was well below the consensus estimate of 56.5. New orders decreased to 53.0 from 60.2 and the employment index fell to 55.1 in March from prior month’s figure of 55.7.   

The utilities sector was the biggest gainer among the S&P 500 industry groups and the Utilities SPDR (XLU) gained 1.1%. Stocks such as Duke Energy Corp (NYSE:DUK), The Southern Company (NYSE:SO), Dominion Resources, Inc. (NYSE:D), NextEra Energy, Inc. (NYSE:NEE) and Exelon Corporation (NYSE:EXC) rose 1.2%, 1.2%, 1.1%, 1.0% and 1.3%, respectively.

The energy sector had a bad run and was the only loser among the S&P 500 industry groups. The Energy Select Sector SPDR (XLE) lost 0.3%. Stocks such as Exxon Mobil Corporation (NYSE:XOM), Chevron Corporation (NYSE:CVX), Hess Corp. (NYSE:HES), Petroleo Brasileiro Petrobras SA (NYSE:PBR) and ConocoPhillips (NYSE:COP) fell 0.5%, 1.1%, 0.6%, 1.1% and 0.5%, respectively.

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