Sun, Jan 08, 2012 - Page 10 News List

US markets open the year with modest weekly gains

OPTIMISM:Better job data in the US was enough for investors to forget about Europe’s sovereign-debt woes somewhat, though eurozone concerns will likely linger

AFP, NEW YORK

US stocks opened the first week of 2012 in the plus zone, helped by optimism about the economic outlook, which fueled a strong rally on the first trading day of the year.

However, worries over more stresses in the eurozone kept a cap on gains and analysts said that would likely overshadow trading for the foreseeable future.

The tech-centric NASDAQ held the markets up for much of the week after Tuesday’s opening burst, ending on Friday at 2,674.22 with a 2.7 percent gain for the period.

The Dow Jones Industrial Average added 1.2 percent for the week to 12,359.92, while the broad-based S&P 500 gained 1.6 percent to finish at 1,277.81.

“Although the stock market was unable to close the week on a positive note, it displayed resilience in the face of a weaker euro,” Briefing.com said. “For some prognosticators, that makes for a promising start to 2012, which many believe will still be driven by global financial and economic conditions, especially those in Europe.”

Financial shares were relatively strong during the week, rising 1.5 percent helped by the better job data and hopes the government was going to take more steps to help the housing sector.

Bank of America was among the biggest beneficiaries of that speculation, surging more than 10 percent for the week.

However, tech shares were the best performers: Dell was up 4.9 percent for the week, Apple 4.3 percent, Microsoft 8.3 percent and Oracle 5.0 percent.

Disk-drive maker Seagate picked up 11.6 percent after saying it was relatively unscathed by the floods in Thailand, where it centers its production capacity.

Kodak ended the week down nearly 43 percent amid reports of a pending bankruptcy filing and the New York exchange’s threat to delist it for its ultra-low share price, at closing at US$0.37 on Friday.

Despite some bullishness, analysts said the difficulties in the eurozone continued to cloud sentiment.

On Friday, “dismal factory data out of Germany and notably lofty Italian bond yields spooked more than a few buyers,” Andrea Kramer of Schaeffer’s Investment Research said.

Next week will focus on a meeting slated for the European Central Bank on Thursday and the progress of negotiations between Greece and private creditors over a debt writedown. In the US, key data releases include consumer credit (tomorrow); the US Federal Reserve’s “Beige Book” report on regional economies (Wednesday); retail sales and business inventories (Thursday); and the US trade balance and consumer sentiment (Friday).

“Markets are likely to focus on the Fed Beige Book, prepared for the January FOMC [policy-setting] meeting and December retail sales,” Nomura Securities said.

This story has been viewed 2074 times.
TOP top