Stock Market News for March 24, 2015 – Zacks Investment Research
Markets ended its choppy session in the red yesterday as fluctuations in the value of the U.S. dollar weighed on investor sentiment. Benchmarks witnessed their third lowest trading volume this year on Monday. Meanwhile, weaker dollar boosted oil prices on Monday, which in turn had a negative impact on the transportation stocks. Moreover, decline in biotech stocks dragged down the Nasdaq to negative territory for the first time in last six sessions.
For a look at the issues currently facing the markets, make sure to read today’s Ahead of Wall Street article
The Dow Jones Industrial Average (DJI) declined nearly 0.1% to close at 18,116.04. The Standard & Poor’s 500 (S&P 500) decreased almost 0.2% to 2,104.42. The tech-laden Nasdaq Composite Index closed at 5,010.97; losing more than 0.3%. The fear-gauge CBOE Volatility Index (VIX) gained 3% to settle at 13.41. A total of about 5.42 billion shares were traded on Monday, lower than the month-to-date average of 6.86 billion. However, advancers outpaced declining stocks on the NYSE. For 56% stocks that advanced, 41% declined.
In absence of adequate catalysts in the market, the U.S. dollar continued its trend to be the sole market mover on Monday. Volatility seen in the value of the dollar raised concerns that the fluctuations may hurt earnings of multinationals in upcoming quarters. The concerns led to the sell-off of stocks in the final session. Though the U.S. dollar index declined almost 0.9% on Monday, the dollar has remained significantly stronger against major currencies this year. The euro increased about 1.1% against the dollar to $1.0942. However, so far in 2015, the dollar has jumped around 12% against euro and increased nearly 27% from the year-ago level.
Meanwhile, weaker dollar helped the prices of WTI crude oil and Brent crude oil to gain 1.9% and 1.1% to $47.45 per barrel and $55.92 a barrel, respectively. However, rise in oil prices dragged down transportation stocks on Monday. Dow Jones Transportation Average (DJT) declined almost 2% yesterday and was one of the major decliners among the blue-chip sectors. Key stocks from the sector including Union Pacific Corporation (UNP – Analyst Report), CSX Corp. (CSX – Analyst Report) and Norfolk Southern Corporation (NSC – Analyst Report) declined 4%, 4.2% and 3.5%, respectively.
Moreover, shares of Kansas City Southern (KSU – Analyst Report) declined 8% after providing dismal guidance for revenue growth in 2015. The company now anticipates the revenues to witness low single-digit growth in 2015, compared to its earlier forecast of mid single-digit growth. The company was the worst performer among the S&P 500 stocks on Monday.
Discouraging performance of Kansas City Southern and decline in transportation stocks had a negative impact on the Industrial Select Sector SPDR (XLI). The sector declined 0.8% on Monday and was the biggest decliner among the S&P 500 sectors. Key industrial stocks including The Boeing Company (BA – Analyst Report), Delta Air Lines, Inc. (DAL – Analyst Report), Southwest Airlines Co. (LUV – Analyst Report) and Honeywell International Inc. (HON – Analyst Report) decreased 1.1%, 1.8%, 2% and 1%, respectively. Six out of 10 S&P 500 sectors registered losses yesterday.
Additionally, the iShares Nasdaq Biotechnology (IBB) dropped 2.3% on Monday. Decline in biotech stocks was one of the main reasons behind Nasdaq’s retreat. Key biotech stocks including Biogen Idec Inc. (BIIB – Analyst Report), Celgene Corporation (CELG – Analyst Report), Amgen Inc. (AMGN – Analyst Report) and Vertex Pharmaceuticals Incorporated (VRTX – Analyst Report) lost 2.6%, 4.3%, 2.1% and 4%, respectively.
Separately, the National Association of Realtors reported that existing home sales increased 1.2% in February to a seasonally adjusted annual rate of 4.88 million. However, the seasonally adjusted number was lower than the consensus estimate of 4.91 million. It was also reported that the sales figure rose 4.7% from the year-ago level.
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Stock Market News for March 24, 2015 – Zacks Investment Research
