Stocks Managed Gains Led by Banks and Healthcare. Dow Leaders: MRK, IBM, DIS, TRV, and HD

Published on Thursday, 11 March 2010 17:58 Written by Christopher Lynn

New York, March 11^th (TradersHuddle.com) – Stocks climbed in the last hour of trading to erase earlier losses, pushing the S&P 500 above 1,050, the highest level since October 2008. Banks and healthcare rallied, leading the market higher.

The Dow Jones Industrial Average climbed 44.51 points, or 0.42%. The S&P 500 index gained 4.63 points or 0.40%, while the NASDAQ added 9.51 points or 0.40%. Market breadth was positive. On the NYSE, winners topped decliners by a rate of 3 to 2. On the NASDAQ, advancers outpaced losers by a rate of 4 to 3.

The market opened lower, as the weekly jobless claims report disappointed investors. Claims fell to 462,000, shy of expectations and continuing claims rose more than expected. Also pressuring the market before the open was a report out of China, which showed inflation rose to a six-month high, escalating fears that the economy is overheating and demand for commodities and other goods may start to slow.

Stocks struggled for most of the trading session, failing to hold any gains, until the final hour of trading, as banks rallied, as signs that the financial reform may continue to see obstacles and actually get stuck in Capitol Hill’s gridlock. Healthcare also pushed higher as investors speculated that reform will be harder to pass.

25 of 30 Dow components posted gains, with Merck (NYSE:MRK) leading the gains in the blue chip index as shares jumped 1.63% to $36.88. The drug maker moved higher as investors speculated that the healthcare reform will be harder to pass in Capitol Hill and if it does pass it will not be as bad for drugmakers.

International Business Machines (NYSE:IBM), the second largest U.S. lender, posted the second best gain in the Dow Jones Industrial Average, as shares climbed 1.58% to $127.90. The IT consulting giant gained as the technology sector continues to grind higher on prospects of economic growth.

Walt Disney (NYSE:DIS), the largest media company in the world posted the third best gain in the blue chip index. Disney shares added 1.44% to $33.18, as Disney-ABC Domestic Television, a division of Walt Disney, and Showtime Networks have entered into an exclusive output agreement under which up to 35 of DreamWorks Studios' films, to be theatrically released between 2010 and 2015, will air on the network.

Travelers Companies (NYSE:TRV), the insurance company, was the fourth best Dow component, as shares jumped 1.38% to $53.62. Travelers stock rebounded and practically erasing yesterday’s losses.

The fifth best Dow component was Home Depot (NYSE:HD), as the largest U.S. home improvement retailer climbed 1.32% to $32.13. Home Depot was considered the 4^th most valuable retail brand according to Interbrand Design Forum’s rankings.