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Dow narrowly misses 13,000 again

Reported by AAP
Tuesday, February 28, 2012
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The Dow Jones industrial average has narrowly missed 13,000 again.

A burst of selling at the closing bell drove the Dow lower after it hovered around the milestone for most of the afternoon. The average finished the day about 19 points shy of the mark.

It was close enough that nine cents added to the price of each of the 30 stocks in the Dow would have made the difference. And it almost did: American Express lost 14 cents in the last three minutes of trading. Boeing lost a dime in the last two minutes.

The Dow broke through 13,000 several times last week but hasn't closed above that level since May 19, 2008, four months before the fall of Lehman Brothers investment bank and the worst of the financial crisis.

For the day, the Dow lost 1.44 points and closed at 12,981.51. The Standard & Poor's 500 index rose 1.85 points to 1,367.59, a 3 1/2-year high. The Nasdaq composite index rose 2.41 points to close at 2,966.16, its highest since December 2000.

The Dow fell 100 points at the open on Monday, then climbed back above 13,000 after a report that the number of Americans who signed contracts to buy homes rose in January to the highest in almost two years.

The National Association of Realtors said its index of sales agreements rose two per cent last month to a reading of 97, the highest since April 2010. A reading of 100 is considered healthy.

Financial stocks led the industries gaining ground on Monday. They rose 0.9 per cent as a group. All nine of the other industry groups in the S&P 500 finished with small gains or narrow losses.

Scott Wren, senior equity strategist for Wells Fargo Advisers in St Louis, said investors have gotten ahead of themselves since October. The S&P 500 is up 8.8 per cent this year alone.

He said he thinks US economic growth is likely to be a mild two per cent this year, there are fewer people working now than there were at the end of 2007, and Europe may be in a recession.

"I don't see any reason for the market to be on some incredible run," he said.

The price of oil fell below $109 a barrel as investors booked profits after a 14 per cent gain this month driven by signs of an improving US economy and fears of an Iranian supply cut. Benchmark crude fell by $1.21 to end the day at $108.56 per barrel in New York.

Government figures show that growth in demand for crude oil has slowed in the US from a year earlier, although some oil traders are betting a strengthening economy will eventually boost consumption.

"Four dollar (a gallon) gas, that's not going to really shut down the economy," Wren said. "$5, $6 gas, that's a different story."

The average US price of a gallon of petrol has jumped 18 cents over the past two weeks, with a gallon of regular at $3.70.

European markets fell slightly because of worries about high oil prices. Stocks fell 0.3 per cent in Britain, 0.2 per cent in Germany and 0.7 per cent in France.

The European debt crisis is also still a lingering concern. Finance ministers from the world's 20 leading economies said that they would not add money to the International Monetary Fund until the European Union puts up more money to stave off its debt crisis.

Other commodities rose, including a 1.2 per cent rise in wheat prices in Chicago. Soybeans topped $13 a bushel for the first time in five months. Global soybean supplies are tight, and hot, dry weather has damaged crops in Brazil and Argentina.

Among US stocks making moves:

- Cooper Tire & Rubber Company Co. rose 13.9 per cent after it said net income more than quadrupled in the fourth quarter, mostly because of a large tax-related gain.

- Chipmaker Micron Technology Inc. rose 7.7 per cent after a Japanese rival company filed for bankruptcy protection.

- Warren Buffett's Berkshire Hathaway Inc. rose 0.3 per cent after the investor, known as the Oracle of Omaha, said the company has a successor in mind, plus two backups. Berkshire has not named those executives.

- Shares of Sprint Nextel Corp. rose 3.2 per cent after reports that its board rejected a purchase of MetroPCS Communications. MetroPCS fell 1.5 per cent.

- Lowe's, the home improvement chain, rose 0.7 per cent after reporting a 13 per cent jump in fourth-quarter profits.

01/10/2014 14:00Sydney, Australia. 1 October,2014
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