Dow Gets 100-Point Pop but Ends Week Down 4%
CNBC.com News Editor
The Dow popped over 100 points in the final minutes of trading Friday after a yo-yo session — and a rocky week. Financials gained. Dell was among a handful of decliners.
Some had expected a big selloff again today, after stocks logged their biggest drop of the year on Thursday and as futures showed the market falling to "Flash Crash" levels today.
It was anyone's game as the day unfolded: The Dow Jones Industrial Average dropped more than 100 at the open, popped up over 100 midday, gave it all back then clawed it all back in the dramatic final minutes of trading. The Dow gained over 125 points, or 1.3 percent, ending just shy of 10,200.
The S&P 500 and Nasdaq also gained more than 1 percent. The CBOE volatility indexwas around 42 at the close after popping above 47 earlier.
Twenty-eight of the 30 Dow components ended higher, led by Bank of America and JPMorgan .
Several market pros said bank stocks got a boost as the financial reform passed by the Senate wasn't as tough as expected. That bill must now be merged with the House bill and sent President Obama to sign by July 4.
And Goldman Sachs jumped amid rumors of a possible settlement with U.S. regulators.
The Dow's only decliners were AT&T and Microsoft .
Still, today's gains weren't enough to compensate for losses earlier in the week and the Dow finished down about 400 points, or 4 percent for the week.
All 10 key S&P sectors finished the week lower, led by industrials, energy and tech. Telecoms and consumer staples were the week's best performers.
JPMorgan had the only positive impact on the Dow this week, up nearly 0.5 percent.
All three major indexes slipped into correction territory (down 10 percent from their April highs) on Thursday but after today, only the S&P and Nasdaq are in correction territory.
Some market pros told investors not to be fooled by a temporary rally.
“We rally into summer—but double this decline for what we see into the rest of the year,” Paul Schatz, president at Heritage Capital told CNBC. Schatz said the markets are in deflationary times and warned investors that there are several catalyststhat “spell long-term term problems.”
The market had been jittery over the the European debt crisis and financial reform after the Senate passed the new financial reform bill.
May options on some stocks and some stock indexes expired at the closing bell today, which added another force of volatility to an already jittery market.
Commodity prices continued to slide, with oil settling at $70.04 a barreland gold settling at $1,175.70 an ounce.
Treasurys also ended higher, benfiting from the market jitters. The yield on the 10-year finished at 3.21 percent after earlier falling to a 2010 low of 3.124 percent.
Meanwhile, Germany approved a $1 trillion emergency aid packagefor financially troubled euro-zone nations as an EU task force looks to toughen regulations.
European stocks fell another 2 percentamid worries about the euro-zone debt crisis, with Britain's FTSE 100-share index falling below 5,000 for the first time since November.
BP shares slipped as the company struggles to contain the oil spillin the Gulf of Mexico.
Chips turned in a strong showing, with the Philadelphia Stock Exchange semiconductor index up more than 2 percent.
Some other big-cap techs advanced, including Yahoo , Hewlett Packard and Apple .
However, Dell shares dropped nearly 7 percent after the tech giant beat earnings and sales expectations but its gross margins disappointed and the computer maker warned that the market may remain tight. Meanwhile, analysts are mixed: Brokerage Thomas Weisel raised their price target to $16 from $15 on the stock, while Citigroup lowered their targets.
Salesforce.com recovered from earlier losses after the Web software maker delivered a forecast at the low end of expectations.
Gap rose after the clothing chain announced it slightly better-than-expected quarterly resultson Thursday, and sees expansion for 2010.
Shares of Ann Taylor jumped after the women's clothing chain beat expectationsamid stronger-than-expected demand and sales of more full-priced items.
Meanwhile, PepsiCo said it plans to invest $2.5 billion in China over the next three years to expand its presence where its drinks lag behind rival Coca-Cola . The plan follows an addition to the $1 billion investment to the soft drink giant initially announced in 2008.
MasterCard shares climbed after
Volume was nearly double the daily average, with about 2.3 billion shares changing hands on the New York Stock Exchange. Advancers outpaced decliners more than 3 to 1.
Coming Up Next Week:
MONDAY: CFTC-SEC "Flash Crash" meeting; UK cuts budget deficit; existing-home sales; earnings from Campbell Soup
TUESDAY: Monthly Case-Shiller home price index; Richmond Fed survey; Consumer confidence index; Fed's Bullard speaks; 2-year note auction; earnings from AutoZone
WEDNESDAY: Yahoo Investor Conference; FINRA annual conference; weekly mortgage apps; durable goods; new home sales; weekly crude inventories; 5-year note auction; Fed's Lacker speaks
THURSDAY: J&J recall hearings; 2nd look at Q1 GDP; corporate profits; weekly jobless claims; 7-year note auction; Fed's Lacker speaks; earnings from Costco and Tiffany
FRIDAY: Toyota hearings; Apple expands iPad sales to 9 more countries; personal income, spending; Chicago PMI; consumer sentiment
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