Wall Street bounced back on Tuesday with gains across all three major U.S. indices. The Dow Jones Industrial Average added 0.69%, and ended with 9,015 points. The Nasdaq composite index climbed 1.50%, and ended at 1,652. The S&P 500 rose by 0.78%, and finishing with 934 points. The Russell 2000 index was also higher by 1.01% and closed the day at 514 points. Markets were higher even despite several bits of negative news. Home sales for the month of November were down 4% to 82.3 according to the National Association of Realtors. The Commerce Department also had some sour news, as factory orders for November were down over 4%, marking the fourth straight month of drops. The Federal Reserve predicted another tough year for the economy, and that a recovery will more than likely come in 2010. Details from last months meeting in which the Fed cut rates were released today, showing concerns for 2009 GDP which is forecasted to fall.
Light, sweet crude fell to $48.58 per barrel after going over $50 earlier in the day. Heating oil futures were up and settled at $1.6268. Gasoline futures were also up and closed at $1.89. Natural gas prices were down on the NYMEX, falling $0.08 and settling at $5.98 on Tuesday.
The world’s largest maker of aluminum Alcoa Inc. (AA: 12.12, +0.26 (+2.19%)) announced that 13,500 employees will be cut this year due to lower demand and pricing ability. The cuts will lower production by 750,000 metric tons. Alumnium prices are causing the brunt of the pain for Alcoa and it’s competitors.
Ciena Corp. (CIEN: 8.40, +1.32 (+18.64%)) was upgraded by Barclays from “equal weight” to “overweight,” stating long term growth opportunities as a key driver. Ciena engages in the development, manufacturing, and sales of communication equipment. This news comes as Cisco (CSCO: 17.79, +0.68 (+3.97%)) has plans to enter the data center realm with it’s own blade systems.
The financing arm for General Electric (GE: 16.86, +0.23 (+1.38%)), GE Capital, plans to sell $10 billion worth of FDIC backed debt. This comes a day after an analyst said GE would be forced to either lower their dividend or lose its perfect “AAA” credit rating status.
-Hassan Chaudhry
Disclosure: None
