Posted on 11/29/2005 8:54:44 AM PST by BenLurkin
NEW YORK (AP) -- Wall Street resumed its winning ways Tuesday after two new reports showed a jump in U.S. factory orders and a sharp rebound in consumer confidence. Stocks bounced back from Monday's losses after the Commerce Department said orders for big-ticket manufactured goods grew 3.4 percent in October, with increased demand for military aircraft and parts accounting for more than half of the $7.1 billion gain.
Investors also found reassurance when the Conference Board said November consumer confidence rose 13.7 points to 98.9, besting economists' forecast for a reading of 90. A day earlier, the market languished as traditional storeowners turned in mixed results from last weekend's frenzied opening to the key holiday sales period.
Meanwhile, early reports from online retailers said their sales surged on Monday, widely seen as the start of the Internet's holiday shopping season.
A record level of new home sales last month propelled the homebuilding sector and helped Wall Street's rebound. The major indexes retreated Monday, ending a seven-day advance amid a five-week rally that has catapulted the Standard & Poor's 500 and Nasdaq composite indexes to their highest levels since mid-2001.
In morning trading, the Dow Jones industrial average gained 43.16, or 0.4 percent, to 10,933.88.
Broader stock indicators were also higher. The S&P 500 was up 5.34, or 0.42 percent, at 1,262.80, and the Nasdaq rose 3.44, or 0.15 percent, to 2,242.81.
Bonds slid, with the yield on the 10-year Treasury note rising to 4.45 percent from 4.41 percent late Tuesday. The U.S. dollar was mixed against other major currencies in European trading. Gold prices were lower in Europe but hit 18-year highs in Asian trading, passing $500 an ounce.
Crude oil futures were little changed. A barrel of light crude was quoted at $57.15, up 21 cents, in electronic pre-opening trading on the New York Mercantile Exchange.
The Commerce Department also reported Tuesday that new home sales grew 16.5 percent to total 1.42 million in October, beating forecasts for 1.2 million and a previous July record of 1.35 million. A recovery in the western housing market led the gains, the department said.
Homebuilding stocks pressed forward on the news, with D.R. Horton Inc. rose 39 cents to $35.96, Pulte Homes Inc. climbed 66 cents to $42.21, Lennar Corp. added $1.02 to $58.67 and Centex Corp. advanced $1.17 to $73.83.
Calpine Corp. fell 52 cents to 73 cents a share after the power producer said its chief executive and founder has left the company, along with its chief financial officer. The leadership change comes as concerns about Calpine's liquidity and ability to avoid bankruptcy deepened in the wake of a recent negative court ruling.
Anheuser-Busch Cos. rose 84 cents to $44.85 after saying it still expects full-year earnings to decline by 10 percent to 11 percent, as cost pressures cut into the company's profits. But Anheuser-Busch added that it expects profit to start growing again in 2006.
DuPont Co. has settled federal allegations that it hid information about the dangers of a toxic chemical used to manufacture its popular Teflon coating, according to The Charleston Gazette. The company could face civil fines of more than $300 million, and has set aside $15 million to cover legal costs. DuPont added 29 cents to $43.40.
Advancing issues outpaced decliners by 2 to 1 on the New York Stock Exchange, where volume of 468.5 million shares topped the 408.4 million shares changing hands at the same point Monday.
The Russell 2000 index of smaller companies rose 3.33, or 0.5 percent, to 674.83.
Overseas, Japan's Nikkei stock average fell 0.40 percent. In afternoon trading, Britain's FTSE 100 added 0.43 percent, Germany's DAX index gained 0.64 percent, and France's CAC-40 was higher by 0.52 percent.
Don't you know the establishment media says the economy is terrible and all the polls say the American people agree? (being sarcastic)
Yes the equity markets gapped up before the open...but they basically have been selling off...
The market is overbought right now...imho
They are falling back near session lows as I type this.
The MSM have tried to politicize the economy, but I would be cautious of investing on that basis.
I'm also a little suspicious as to why they are finally running this story at this particular juncture. Personally, I think the charts and figures show that the DJIA and the other major averages are topping out and about to start back down. I just pulled out of the market to wait a safer time.
http://stockcharts.com/gallery/?$INDU
I am short from near the first top of what looks to be a double top
Smart move chief...
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Taking position timeframe of a month or two while keeping an eye on longer term trends, IMHO it's sure looking like we're bouncing up off of a solid support line. I'm fully into small caps.
I've been a little nervous, but this is my fourth week of riding the wave.
I'm not sure if the bear will resume or if there will only be a pullback for a few weeks, but I do expect some kind of a downleg.
Of course, it's possible we'll just keep going up. But if you look at the candlestick chart I linked to, the MACD lines and the overbought indicators suggest that some sort of correction is immanent.
On one side, as we get into year's end, all the financial types will be trying to push the market higher to ensure good bonuses for themselves. On the other side, I would expect some tax selling.
I'm finding it hard to believe that the Dow is the one to look at and all the other trends are skewed.
Here's a link to the S&P500 chart. Note that it also has gone pretty well straight up nonstop, and is now looking toppish. The MACD lines haven't crossed yet at the top, but they look suspiciously like they are about to.
Also, the volume is dropping and the CMF chart at the bottom looks as if it has already peaked, although it could conceivably reverse again.
http://stockcharts.com/gallery/?$SPX
If I could paraphrase H S Truman, what we need is a one-handed tech analyst. ;)
If we knew what the market would do tomorrow, we'd be rich.
I just checked the market. Down 3 pts. What rise?
take your profit and re-enter...but small caps are seeing flow right now...
we are going short term down from here off the double top..
but...
the russell has faded the big cap indexes the last few days..they are rolling out of the big cap into small cap...
if you dont mind the wiggle..your good
but imho it is short term down from here...
fwiw
the last two days the dow has faded the pullback...
where as the naz and sp have yanked back..dow is the party crasher on the short term shorts...
dow has exhibited strength this week in the face of a withering barage of short selling
so has the russell
the 4 prime indecies are a bit out of step with one another...
i think the double top on the big caps will rule the day and its short term down from here at the top of the trading channel
my money is where my mouth is: im short all four
but the russell and the dow are the strongest of the four
fwiw
double toppish due to the abreviated session on friday..and quadruple toppish if you go back some days-weeks...
We are at the top of the ascending channle up...
Short term short
I am heavily bullish this market...
But this week I am short....
Just to be clear
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