by Sam Collins | December 27, 2013 2:05 am
Thursday’s price action on the major exchanges may have appeared to be dull, but many stocks made new highs and the Dow industrials gained for the sixth session in a row.
Bond prices fell and the yield on the 10-year Treasury rose to 3%. This is a strong indication that public sentiment is moving toward optimism and that the Federal Reserve is cutting back on its bond-buying program.
The number of people filing for unemployment benefits declined by a larger number than economists expected.
At Thursday’s close, the Dow Jones Industrial Average gained 122 points to 16,480, the S&P 500 rose 9 points to 1,842, and the Nasdaq gained 12 points to 4,167. The NYSE total volume was close to 2 billion shares, and the Nasdaq traded 1.2 billion shares. Advancers outnumbered decliners by 1.1-to-1 on both major exchanges.
The Dow has extended its gains as institutions gobble up the best blue chips prior to the end of the year. This year, the industrial have jumped almost 26%.
Even though the Dow Jones Utility Average is far from new highs, it is not in a bear market but is consolidating on a broad bottom. It, like the other Dow indices, traces its bottom to March 2009. It may not be the most exciting index, but it has provided a solid rate of return when combined with its higher-than-average dividends.
Conclusion: The markets are plodding toward the close of 2013. With only three sessions to go in the year, investors should focus on the big-cap blue chips since that is where the smart money appears to be headed.
To see a list of the companies reporting earnings today, click here.
For a list of this week’s economic reports due out, click here.
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