Most Stocks Gained as Investors Took a Breather and AIG Sold Another Unit. Dow Leaders: CSCO, MCD, VZ, T, DD

Published on Monday, 08 March 2010 18:25 Written by Manuel Guerra

New York, March 8^th (TradersHuddle.com) – Most stocks climbed with major benchmark indices ending mixed, with the NASDAQ edging an 18-month high. Tepid trading as investors took a breather from last week’s rally, as they mulled over another AIG unit sale, Dollar strength, and lower commodity pricing.

The Dow Jones Industrial Average lost 13.68 points, or 0.13%. The S&P 500 index slid less than 1 point or 0.02%, while the NASDAQ added 5.86 points or 0.25%. Market breadth was positive. On the NYSE, winners topped decliners by a rate of 7 to 5. On the NASDAQ, advancers outpaced losers by a rate of 7 to 6.

The market drifted for much of the trading session, with only the NASDAQ posting some gains. Investors started the trading session with eased concerns on Greece’s deficit crisis, and with American International Group (NYSE:AIG) announcing the sale of its foreign life insurance unit to MetLife (NYSE:MET) for around $15 billion in cash and stock.

The AIG sale helped reassured investors, as they see it as a good sign that the troubled insurer is able to raise capital by selling its assets to try to pay back the bailout funds to the U.S. government.

Telecom shares climbed 1.25% as a group posting the biggest advance among the 24 S&P 500 industry groups, as shares of Sprint Nextel (NYSE:S), the third wireless U.S. carrier, rallied 3.7% after the company said it expects revenue growth in the next several quarters.

Health insurers and drug makers declined as President Obama criticized insurance providers for high premiums and denying coverage to the sick in a speech in Philadelphia. It was the first of several speeches the president will deliver to try to drum up support for health-care reform.

13 of 30 Dow Jones Industrial Average components posted gains, with Cisco (NASDAQ:CSCO), the networking giant, posting the biggest gain in the blue chip index, as shares added 3.65% to $26.13. Cisco shares jumped after JPMorgan started coverage of the stock with an "overweight" rating and a $28 price target. The analyst cited the potential demand for networking equipment from growth in mobile data and server virtualization.

McDonald’s (NYSE:MCD), the largest restaurant chain in the world, posted the second best gain in the Dow Jones Industrial Average, as shares climbed 2.28% to $65.12 after global sales topped estimates. The company announced that its global sales increased 4.8% in February.

Verizon Communications (NYSE:VZ), the owner of the biggest U.S. wireless network, and AT&T (NYSE:T), the 2^nd largest wireless carrier in the U.S., posted the third and fourth best gains respectively in the blue chip index. Shares of the telecom giants benefited for the strength in the sector after Sprint announced revenue growth, easing concerns of price cuts hurting the top line. Verizon gained 1.37% to $29.63, and AT&T added 1.16% to $25.28.

The fifth best Dow component was Dupont (NYSE:DD), the life sciences company, as shares climbed 1.14% to $35.37. The stock rallied 3.7% last week amid good economic data that lifted the stock on prospects of higher demand for its products.