The S&P 500 finished a volatile session in red with the day’s market direction primarily dictated by the U.S. dollar and comments from Fed Chairman Ben Bernanke. Friday’s jobs report led some to believe that the Fed would need to raise interest rates sooner than later.
In a speech today, Bernanke said, “we are still looking at the extended period,” with regard to low interest rates. At first, stocks rallied on the phrase extended period, which in other words means the liquidity party isn’t over. However, the market seemed to pause and reflect on the “formidable headwinds,” Bernanke referred to such as a weak labor market and tight credit.
Financials were by far the weakest sector today, off 1.61%. Citigroup and Wells Fargo disagreement with the government over TARP repayment is getting much press. Also receiving attention is the fact that the total cost of TARP could be cut by $200 billion.
Telecom was the best performing sector, notching a 1.77% gain. Telecom stocks have gained 4.67% in the past five sessions. Utilities have gained 3.77% during the same time period.
Quick Hits
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Peter J. Lazaroff, Investment Analyst
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