By Leslie Wines, MarketWatch
Dec 7, 2005
U.S. stocks opened at lower levels Wednesday, as investors pondered market
levels after a nearly five-week rally ahead of weekly crude supplies data.
Dow components were in focus after General Motors named a new chief
financial officer and 3M Co. tapped a new chairman and chief executive.
The Dow Jones Industrial Average was down 7.05 points at 10,849.81.
The S&P 500 and the Nasdaq Composite were down 0.63 points at 1,263.07 and
down 0.79 points at 2,259.97.
Wednesday's dull opening price action echoed the weak trade seen late in
the day Tuesday, when stocks closed well off their highs, after earlier
rallying on news of the strongest productivity rise in two years.
Investors Wednesday were gauging the state of the year-end rally.
"The key levels to watch are still last week's intra-day lows. Those
levels are Dow - 10,485; S&P 500 - 1249, and Nasdaq Composite - 2230, said
Marc Pado, U.S. market strategist at Cantor Fitzgerald.
"Busting below this support will kick off more of a corrective phase.
Remember, this is the 'slump' ahead of the 'Santa Claus Rally.' While I
still believe in Santa, I think he may have lost a little weight this
year."
At 3.00 p.m. the market will view the consumer credit report for October.
The MarketWatch forecast, based on a poll of economists, is for a rise of
$3.7 billion, against a decline of $100 million in September.
Crude futures last were trading above the key psychological level of $60 a
barrel level, a factor which could weigh on stocks. The front-month
futures contract last was up 59 cents at $60.53 a barrel.
Traders are looking to the release of weekly supply data later in the
morning, with forecasts for a rise in distillate inventories but estimates
for crude supplies mixed.
Gold futures extended their recent rally, which is being fueled by heavy
physical demand and inflation fears. Some market participants now wonder
if the futures contract could hit the $600 an ounce level by year-end.
The front-month contract last was up $3.80 at $517.60 an ounce.
Treasurys were under pressure, reversing some of Monday's gains. The
benchmark 10-year note last was down 6/32 at 99-29/32 with a yield of
4.512%.
The dollar was higher against its major rivals, trading up 0.8% at 120.85
yen, as the euro fell 0.06% to $1.1718.
Stocks to note
3M Co. rose 1% to $78.45. The manufacturing conglomerate named George
Buckley to serve as its chairman, president and chief executive. He
replaces interim CEO George Morrison.
General Motors last was up 1 cent at $22.40. The struggling automaker late
Tuesday tapped Frederick "Fritz" Henderson, currently chairman of GM
Europe, to take over for John Devine as the automaker's chief financial
officer and vice chairman.
Henderson's promotion comes at a time when the world's biggest automaker
is grappling to contain soaring healthcare and pension costs amid flagging
demand for its cars and trucks.
Shares of Cisco Systems were 2.4% higher at $17.96. J.P. Morgan upgraded
the stock to overweight from neutral, following its analysts' meeting.
This MarketWatch news update is provided to you courtesy of Thomson
Financial.
This is Thomson Financial's Market Commentary, which is issued three times
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p.m.). The information herein is believed to be true and accurate. We
take no responsibility for inaccurate information and reserve the right to
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SOURCE Thomson Financial Corporate Group
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