After The Close - Stocks pushed mostly higher today on favorable sentiment, but plateaued midway through the session and saw some subsequent selling in technology issues. At the closing bell, the Dow Jones Industrial Average was up 62 points, but the NASDAQ was down six points. The S&P 500 reached an all-time high, indicating strength in equities, although most of the momentum was earlier in the day. Advancers topped decliners by about a four to three margin on the New York Stock Exchange, pointing to broad market support.

Notably, market action transpired against the backdrop of concerns over stock and bond valuations voiced by Richard Fisher, president of the Federal Reserve Bank of Dallas. Mr. Fisher is reported to have said in a speech that the central bank needed to monitor whether or not a bubble in equities was forming.

It is a bit ironic, though, that it is the Fed’s own low interest-rate policies that are helping to push investors into stocks in the absence of feasible alternatives. The Fed is not using all of its tools to rein in speculation, either, since it could raise the margin requirement on stocks, or at least threaten to, but has not changed the 50% initial margin requirement for many years. It may be the Fed has enough on its plate, being charged by Congress with maintaining full employment while keeping the level of prices in the economy stable.

Elsewhere, there was optimism that the troubles in Ukraine would be solved diplomatically, rather than militarily. The euro’s rise to a level not seen since 2011 seemed to reflect prospects for a favorable outcome.

In terms of the economy, the news was more mixed, with the labor market appearing firm, as initial weekly jobless claims fell, but a greater-than-expected downward revision in the nation’s fourth-quarter productivity and greater-than-projected decline in January factory orders.

Among individual issues, shares of office retailer Staples (SPLS) and discounter Costco Wholesale (COST) dropped sharply after those companies posted disappointing quarterly results. On the upside, Valero Energy (VLO) stock rose after a positive response to a meeting it held with analysts.  

Tomorrow brings the closely watched monthly government jobs report before the market opens. The nation is thought to have added around 160,000 jobs in February. But recent economic data have been skewed by harsh winter weather, and that could be the case again for Friday’s employment figure. -Robert Mitkowski

At the time of this writing, the author did not have positions in any of the companies mentioned.


12:30 PM EST - The U.S. stock market is making measured progress so far today, after taking a pause yesterday. At just past noon in New York, the Dow Jones Industrial Average is up 88 points; the broader S&P 500 Index is ahead eight points; and the technology-heavy NASDAQ is higher by 11 points. There is a positive bias to the session, as rising issues are ahead of decliners by about two to one on the NYSE. Notably, there are 200 stocks making new highs on the NYSE, versus 59 at new lows, and that, too, suggests that the general direction is much improved over the past few weeks. Further, speculative sentiment is still alive, as the Russell 2000 small-cap index has been making strides lately. This indicates that investors are not too risk averse, and are not simply confining themselves to the big names. Meanwhile, on the NASDAQ we have seen buying in growth names like electric car maker Tesla (TSLA) and social media giant Facebook (FB), also suggesting some excitement among traders. Today, leadership is apparent in the basic materials issues, as the mining stocks continue to recover. The financial names too, are doing well. Nonetheless, the high-yielding utilities are slipping today.

Technically, the stock market continues to hold up well. The S&P 500 Index is at new high ground. While yesterday the bulls took a rest, we are now looking for follow through buying, to give the push higher some solidity. That move may materialize today, or tomorrow, as the monthly employment report due out in the morning could provide a catalyst. The VIX is slightly lower to 13.75, today.

Meanwhile, there were a few economic reports issued earlier today. The employment situation was back in the spotlight. Initial jobless claims came in at 323,000 for the week ended March 1st. This showing was a bit better than had been expected. Weekly continuing claims declined a bit, too. Elsewhere, productivity increased about 1.8% in the fourth quarter, but many had been looking for a bigger increase.

We received a few earnings reports this morning. Shares of Staples (SPLS) are trading sharply lower, after the office supplies retailer’s results and outlook disappointed investors. Also in retail, Costco (COST) stock is heading lower after that company put out weak quarterly results. - Adam Rosner

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.


Stocks to Watch from The Survey Retailers are still in the earnings spotlight, with several companies reporting quarterly results last night and this morning. Investors took issue with a number of releases, including those from office supplies seller Staples (SPLS), kid’s apparel and accessories retailer The Children’s Place (PLCE), and warehouse club Costco (COST). All three stocks are moving lower ahead of the bell, with SPLS and PLCE showing considerable weakness.

Conversely, Wall Street appeared pleased with results and/or outlooks from grocer The Kroger Company (KR), mining machinery and equipment manufacturer Joy Global (JOY), telecommunications equipment company Ciena (CIEN), and computer peripherals maker Logitech (LOGI), which increased its guidance and announced a new share-repurchase authorization. – Matthew E. Spencer 

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.


Before The Bell - The stock market, which has been on a veritable seesaw this year, pulling back notably in January, regaining just about all of the lost ground in February, then tumbling to start this week and month on Monday, before surging ahead once more on Tuesday, did little of note yesterday.

To wit, after the Dow Jones industrial Average had tumbled by 154 points to start the week, and surged by 227 points in Tuesday's impressive comeback rally, that 30-stock composite edged lower by 36 points yesterday. The other averages did comparatively little, as well, although there was a modest tilt to the downside, overall, with the small -and mid-cap indexes showing proportionately more weakness, and most mutual funds edging lower on the day. On Monday and Tuesday, it was the fast-changing situation in Ukraine that told the tale of a much more volatile tape. Specifically, Russia initially marched thousands of troops into that embattled area, sending stocks lower worldwide. However, when those same troops marched out of Ukraine on Tuesday, stocks rallied vigorously, as fears of an armed conflict within this very tense region eased--at least for now.

Then, yesterday, with no new developments in Ukraine, of note, the market refocused on domestic matters, where things have been softening in recent weeks--a modest slippage in growth that most pundits believe has been weather driven in almost its entirety. For example, at 10 AM (EST) yesterday, the Institute for Supply Management reported that non-manufacturing activity had grown by the slowest amount in more than a year in February. Normally, such a report, which registered a reading of 51.6 for last month, which was well off from the prior month's 54.0 result, would have brought about some negative reaction in the markets. However, many of the respondents in this survey noted that the weather had affected activity levels in their respective industries. Thus, once again, many are looking past the raw numbers and, instead, surmising that once temperatures start to climb, activity will quicken again, just as it did in last year's final few months.   

Moreover, that conclusion regarding non-manufacturing was given added weight when the Federal Reserve issued its Beige Book economic summation at 2 PM (EST). That compilation, which is used by the lead bank as an added tool to help it formulate future monetary policy, showed modest aggregate improvement in most categories for the latest period, with some reference to the weather being a negative force for most of the dozen reporting Federal Reserve Districts. There was muted reaction in the financial markets to this report, given the weather's likely impact. Finally, we received a rather downbeat reading on private-sector job creation early yesterday from Automatic Data Processing (ADP). That concern reported that the private sector added just 139,000 jobs last month; expectations had been for a gain of 160,000. Normally, that miss also would have evoked some negative reaction. But as the weather again likely influenced matters, the response was a big yawn. It will be interesting to see what the reports coming out over the next month or two will suggest, and the consequent reactions to them.

As to the market, as noted stocks largely rested yesterday, which was constructive given the excitement over the past two sessions and the continued high level of equities. Our sense is that stocks remain extended, but given the low interest-rate environment and the accompanying muted inflation, there are few reasonable places to put money to work other than the equity markets. Hence, new money continues to pour into the stock market. How long can this last? That is anyone's guess. For now, though, with interest rates still at historically low levels, with profits still on the rise, and with relatively few choices of comparable appeal, the path of least resistance could well be higher still.     

Finally, as we look ahead to the day unfolding on our shores and gaze out at the balance of the week, we see that stocks were higher overnight in Asia, while they are tracking a similarly better path thus far in Europe this morning, as the European Central Bank left interest rates unchanged. And over here, with the headline report on February job creation and the accompanying U.S. unemployment rate still some 24 hours away, and with that issuance often being a market mover, our equity futures are pointing to a modestly higher opening on Wall Street when traders get down to business in less than an hour from now. - Harvey S. Katz

At the time of this article's writing, the author did not have positions in any of the companies mentioned.