Daily Market Recap

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The S&P 500 rose by 0.35% and the Dow was higher by 0.74% today. There was some movement out of the safety trade and into cyclical issues today. There was a move higher in the materials and industrial names. The question is if this is a sustainable move higher for these beaten down areas or just a one day rally. Materials, technology, managed care, and financials were the leading areas of the market today. Homebuilders, airlines, and utilities trailed the tape.

Commodities were mostly higher after Chinese CPI showed an easing of inflationary pressures. Precious metals, copper, and crude were higher on the day and natural gas and wheat were lower. Copper rose by 2.1%, gold was higher by 0.73% and silver rose by 2.45%.

There was little news flow in the financial sector today. Some key earnings reports in the sector will be released later in the week. Banks and insurance stocks worked higher. There was some profit taking in the REIT space after the sharp advance yesterday.

Several large cap technology names were higher today. Intel, Microsoft, and Hewlett Packard were all higher on better than expected news on PC shipments. Semiconductors were the strongest group in the sector.

Materials were one of the strongest areas of the market today. February’s strong CPI numbers from China created concern that there would be a rate increase to cool growth. The “just right” growth number released today led to a sharp advance in materials.

The energy sector rose by 0.75% as crude increased by 0.75% and natural gas was higher by 1.25%. GE’s purchase of Lufkin yesterday increases the potential for further acquisitions in the oil services area. Crack spreads for refiners remain strong and there was add on buying today after the sharp decline last week.

Healthcare outperformed the market with drug stores and HMOs strong and pharma stocks weak. Drug stores were higher on continued strong same store sales gains. Pharma stocks were slightly lower after many reached all-time highs last week.

Source: PFS Group

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