Intraday Market Update
In a real shocker this morning Fitch cut Greece's credit ratings by two notches (from BBB+ to BBB-) and signaled further downgrades are possible, citing the intensification of fiscal challenges for the country in response to more adverse prospects for economic growth and increased interest costs. The downgrade came after various reports suggested that EU and Greek officials would disclose concrete details of the standby financing package for Greece. The markets shrugged off the downgrade as the spreads between German and Greek bonds have narrowed sharply.
U.S. investors don't seem to care either as the DJIA appears ready to make a run at the psychologically important 11,000 level. The Dow was up about +44 points to 10,970 in early afternoon trading. The S&P 500 also appears poised to test the 1,200 level. The S&P gained about 5 points and is trading at about 1,191.
Stocks were boosted by a better than expected wholesale inventories released this morning. Inventories at the wholesale level jumped +0.6% in February and were revised slightly higher in January to now show a monthly gain of +0.1%. February's gain is headlined by a +0.5% rise for durables in a solid indication that wholesalers are now beginning to rebuild their inventories. Details show a build for metals and computers and a second straight build for lumber.
In Equities, beverage maker Constellation Brands beat earnings estimates but missed on the top line. The firm's guidance for 2010 was a little soft which sent shares of STZ down more than -3.50%, while those of competitor Diageo are up +1.50%. Household product maker name Blyth blew out expectations in its Q4 earnings report, sending its shares up more than +50%, although executives warned that the strong performance would unlikely be repeated in the near term.
Chevron was up +1.0% after providing a mid quarter update after the close yesterday. Chevron said it expects its Q1 profit to be sequentially higher, driven by higher earnings from its production and exploration operations, which are benefiting from higher commodity prices. Mortgage insurance names are sharply higher after AMBAC posted its second quarterly profit in a row.
Front month crude gave back its early session gains and is down -0.90% to about $84.50 per barrel. Gold is advancing again for the 7th straight session and is near $1,163 per ounce (+0.76%), which is also near a key resistance level from January 11. Silver is on fire again gaining +1.40%. Silver has gained +11.25% since its March 25 low of $16.55. Natural gas (+4.10%) is catching a bid and is back above back above $4.00. Copper is relatively flat.
Just the opposite of Thursday, every major international market closed higher on Thursday with the exception of Korea which was lower by -0.54%. Leading the gains in the Asia-Pacific region were Hong Kong (+1.56%), China (+0.85%), Thailand (+0.73%), and Japan (+0.32%).
All major European markets also closed higher led by Spain (+2.87%), France (+1.81%), and Italy (+1.19%). Stocks in London and Germany were higher by +1.02% and +1.26%, respectively.
Core Sector List:
Strongest Sectors: Gold Miners, Oil, Home Construction
Weakest Sectors: Oil Services, Internet
S&P 500 - Daily and 30-minute Intraday Charts:
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