Dow snapped 6-Day Losing Streak
Published on Thursday, 10 May 2012 19:12 Written by Christopher Lynn
New York, May 10th (TradersHuddle.com) – Stocks closed mixed for the session as the upside move faded in the last minutes of trading. However, the Dow was able to snap its 6-session losing streak, while the S&P gained and the NASDAQ ended little change, but in negative territory, as techs dragged following Cisco’s disappointing outlook.
The Dow Jones Industrial Average climbed 19.98 points, or 0.16%. The S&P 500 index gained 3.41 points, or 0.25%, while the NASDAQ lost 1.07 points, or 0.04%.
Overnight, futures had been under some pressure after China’s trade data missed expectations and as European jitters continued with the possibility of new elections in Greece.
However, futures caught a bid and the market started in positive territory, providing investors with a modest bounce after six consecutive sessions of weakness. Weekly jobless claims data was generally inline with consensus, which coupled with positive price action in Europe and a slight rebound in the euro helped boost equities’ prospects for the session.
Most of the S&P 500 sectors closed in with gains, however the weakness in the technology and materials sector weighed on the overall performance of the benchmark indices. Utilities, healthcare, and consumer staples posted the biggest gains in the session.
Tech was under pressure after Cisco (NASDAQ: CSCO), the networking giant, plunged to the bottom of both the S&P 500 and the Dow Jones Industrial Average. Shares tumbled more than 10% to $16.74, trading at their worst levels this year. Cisco provided weaker than expected guidance as its CEO was being cautious amid numerous uncertainties around the world, but particularly Europe. The Networking equipment maker posted earnings results that topped expectations but still brokerage houses cut their price targets on the stock.
The downbeat forecast also impacted stocks like Salesforce.com (NYSE: CRM) and Juniper Networks (NASDAQ: JNPR). Salesforce tumbled 9% to $135.44 on concern over the corporate spending and the European impact and Cisco’s rival Juniper lost nearly 5%.
Another weak component in the sector was Windstream (NYSE: WIN), which tumbled 10.4% to $10.09 after its results were below expectations and the telephone company provided disappointing quarterly guidance.
Also in the sector, Apple (NASDAQ: AAPL) gained 0.24% to $570.52, testing its 50day exponential moving average at the $572 area. The stock traded as high as $575.88.
Elsewhere in the consumer discretionary space earnings also played a role. Kohl’s (NYSE: KSS) tumbled 4.33% to $48.66 after it posted a sharp decline in earnings as its gross margins was hurt by price cuts amid increase competition.
Priceline (NASDAQ: PCLN) tumbled 5.26% to $37.84 on negative reaction to its quarterly results and guidance. The company posted better than expected earnings with revenues meeting consensus, while the travel reservation site issued inline guidance for the current quarter. The results were not bad, but failed to meet the heightened expectations particularly on the revenue side.
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