By Kristina Peterson
The materials sector led U.S. stocks higher Wednesday as
better-than-expected reports on private-sector jobs and the
services sector in the U.S. provided a boost, while new
budget-stabilizing plans from Greece weighed on the U.S.
dollar.
The Dow Jones Industrial Average (DJI) was up 22 points, or
0.2%, at 10,427, making its year-to-date performance nearly
unchanged. The index on Tuesday crossed into positive territory for
the year for the first time since January, but wasn't able to hold
it into the close.
Headlining Wednesday's economic news, payroll giant Automatic
Data Processing reported a fewer-than-expected private-sector job
losses.
Also boosting sentiment, the Institute for Supply Management
said U.S. non-manufacturing sector expanded at a
faster-than-expected pace in February, although employment within
the broad sector was still contracting.
"It does look like we're at a modest growth," said Ben
Halliburton, chief investment officer at Tradition Capital
Management, though he was disappointed with the employment portion
of ISM's report. "It's hard to have a self-sustaining recovery when
employment's very difficult."
The Nasdaq Composite (RIXF) rose 0.2%. The Standard & Poor's
500-stock (SPX) index advanced 0.3%, led by its materials
sector.
The health-care sector was the S&P 500's only category in
the red, declining ahead of remarks President Barack Obama was set
to make laying out his strategy for bringing the long-running
debate over health care to a conclusion.
"Anything that increases the odds that a deal could be struck,
which is what Obama's proposals do, is going to hurt the
health-care stocks," said Jim McDonald, chief investment strategist
at Northern Trust Global Investments. "They're facing a headwind
now with the re-focus on getting a bill passed through."
Supporting commodities stocks, the dollar fell against the euro
after the Greek government announced a new austerity plan Wednesday
totaling 4.8 billion ($6.53 billion) to ensure it can meet its
deficit-cutting pledge this year, including steep cuts in civil
service salaries and entitlements. Greece will also raise its sales
tax by two percentage points.
Crude-oil prices climbed above $80 a barrel and gold futures
rose . Treasurys declined, with the 10-year note off 6/32 to yield
3.631%.
Movers
Industrial giant Caterpillar Inc. (CAT) rose 1.7%, helping the
Dow climb, as the economically sensitive company was boosted by the
latest round of improving data points. General Electric Co. (GE)
rose 1.5%, boosted by the signs of economic growth, along with
materials components Alcoa Inc. (AA) and DuPont (DD). Alcoa rose
1.7% and DuPont climbed 1.1%.
The Dow was also bolstered by its financial components as Fitch
Ratings said U.S. credit card delinquencies declined in the January
collection period, though charge-offs spiked.
Drug maker Pfizer (PFE) was the Dow's worst component. The stock
shed 1.6% after Medivation said its experimental Alzheimer's
disease treatment Dimebon, which was in development with Pfizer,
failed to show effectiveness in a large late-stage study. The news
sent shares of Medivation (MDVN) -- which has no products on the
market and isn't a Dow component -- plunging 67% on heavy
volume.
Novell (NOVL) shares surged 27% to $6.01, topping an offer price
announced late Tuesday from hedge fund Elliott Associates and
sparking speculation another software company or hedge fund could
step in with a higher bid.