Wall Street calm; earnings reports due
Monday, January 9, 2012
Stocks drifted higher Monday in a fourth consecutive listless session. Traders waited for corporate financial results to start rolling in so they could look for clues about the economy.
In the unofficial kickoff to earnings season, Alcoa, considered an economic bellwether because so many companies use its products, said it lost $34 million from October through December because of lower demand for aluminum.
The loss amounted to 3 cents per share. Analysts surveyed by FactSet, a provider of financial data, had expected a loss of 2 cents per share. Alcoa said revenue was $6 billion, compared with an estimate of $5.7 billion.
The results were released after the market closed for the day. Alcoa stock finished up 2.9 percent, the biggest gain of the 30 companies in the Dow Jones industrial average. It was little changed in after-hours trading.
The Dow closed up 32.77 points, or 0.3 percent, at 12,392.69. The broader Standard & Poor’s 500 index gained 2.89 points, or 0.2 percent, to 1,280.70. The Nasdaq composite index rose 2.34, or 0.1 percent, to 2,676.56.
Stock trading has been subdued in recent days. The Dow’s high and low were only 75 points apart Monday. In all of 2011, trading was that narrow on only 26 days. In the final five months, the average daily swing was 249 points.
The broader market has been calm, too. The S&P rose 19 points Jan. 3, the first trading day of the year, but has risen or fallen by less than four points each of the following four days.
Volume was light Monday, as it has been all but one trading day this year, at 3.28 billion shares. Last year, about 4.3 billion shares changed hands on an average day.
Other markets were fairly quiet. The yield on the 10-year U.S. Treasury note fell to 1.96 percent from 1.97 percent.
Analysts think profit growth slowed for U.S. multinational companies from October through December because of weaker demand overseas. Europe is on the brink of recession, and China’s explosive economy is cooling.
Quarterly profits for S&P 500 companies will probably only grow at half the rate of the previous three quarters, said Sam Stovall, chief equity strategist at S&P’s Capital IQ. The companies generate about half their revenue overseas, he said.
About two stocks rose for every one that fell on the NYSE.
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