Equities Register Modest Gains at Midday
28-Mar-13 13:00 ET
[BRIEFING.COM] At midday, the major averages are little changed, and the S&P 500 is higher by 0.1%.
Stocks began the final session of the holiday-shortened week on a positive note. However, the slim opening gains were erased briefly when the March Chicago PMI fell short of expectations.
For March, the Purchasing Managers' Index fell to 52.4 from the 56.8 reported in the February report. Meanwhile, the Briefing.com consensus had expected a smaller decline, to 56.5.
Although the disappointing report caused a stumble in the S&P 500, bargain hunters were quick to buy the weakness and push the benchmark average above its record close of 1565.15 set in October 2007.
Today's modest gains have been paced by defensive sectors. Health care and utilities have shown strength from the start, and they remain atop the leaderboard. The SPDR Utilities Select Sector ETF (XLU 38.88, +0.25) is higher by 0.7%, and is the top performing sector ETF.
In addition to health care and utilities, materials and industrials have outperformed the broader market after the growth-oriented sectors lagged in recent sessions. Today, the industrial sector is receiving considerable support from transportation-related stocks.
The Dow Jones Transportation Average is higher by 0.8% with railroads outperforming notably. All four railroads that comprise the transportation complex sport gains near 1.0% with Kansas City Southern (KSU 110.93, +3.19) leading the way.
On the downside, the financial sector trades with slim losses. Bank stocks have remained under pressure since the first Cypriot bailout proposal was unveiled two weeks ago. The SPDR Financial Select Sector ETF (XLF 18.13, -0.03) is off by 0.2% in today's action, and down 1.5% since last Monday.
Reviewing today's economic data, the latest weekly initial jobless claims count totaled 357,000. This was higher than the 338,000 that had been expected by the Briefing.com consensus. Today's tally was also above the revised prior week count of 341,000. As for continuing claims, they fell to 3.050 million from 3.077 million.
Lastly, the third estimate of third quarter GDP showed growth of 0.4%, which was better than the 0.3% that had been expected by the Briefing.com consensus. Meanwhile, the third quarter GDP Deflator was revised up to 1.0%.