The S&P 500 closed higher by 0.46% through the strength of a late day rally. The Dow closed higher by 0.27%. There were some positive developments in Europe and here in the U.S. The ECB announced they would not be leaving the European troika. News from the conference being held with Eurozone finance ministers was constructive. In the U.S., legislation was introduced in the House that would avoid a government shutdown and ease some of the elements of the sequester.
China’s Shanghai composite fell by 3.6% after the introduction of tightening measures. News overnight from China had our futures market trading lower. Chinese officials announced steps to curtail the rapid rise in the country’s housing prices.
Airlines were an area of strength today. Delta gave better than expected guidance. They said this will be the most profitable quarter in twelve years. Delta and United each closed higher by more than 5%. Sky West moved above resistance to close at a fresh 52-week high.
Financials traded flat for most of the day until investors came in and aggressively bought the space in the final hour of trading. There was no specific news that acted as a catalyst. The space has come in somewhat. There is a major investor conference starting tomorrow. All the major financials are expected to make presentations over the next few days. Charles Schwab rose by better than 2% after Bernstein upgraded the stock today. Asset managers, banks and insurance companies all traded higher on the day.
Housing stocks and building materials names were higher today. Homebuilders have had to deal with mixed housing related data over the past few weeks. The space moved higher throughout the day to finish at the highs for the day.
The transport sector moved out to a new 52-week high, led by the airlines and rails. While up, parcels slightly lagged the overall market. Presentations from Delta and United management were favorably received at an investor conference and both stocks were up better than 5% on the day. Short haul railroads and the traditional blue chips all worked higher.
Refiners bucked the weakness in the energy sector. Many refiners moved out to new highs today. Crack spreads remain strong for these companies ahead of the summer driving season. Marathon Petroleum shot higher by better than 5% on a day when crude fell by 0.75%.
The consumer space outperformed the broader market today. Discount retailers like Wal-Mart Dollar and Dollar General traded well all day. Costco continues to be a favorite in the space. Target moved high by 3.6% on an analyst upgrade.
Source: PFS Group
