Published November 09, 2012
FOX Business: Capitalism Lives Here
The markets shook off early losses and climbed as traders weighed better-than-expected economic data with ongoing fears about the fiscal cliff.
As of 12:15 p.m. ET, the Dow Jones Industrial Average climbed 59.8 points, or 0.47%, to 12872, the S&P 500 rose 11.6 points, or 0.84%, to 1389 and the Nasdaq Composite climbed 28.9 points, or 1%, to 2924.
With the U.S. elections out of the way, Wall Street is looking squarely at Washington, D.C. for answers on how politicians will overcome deep ideological schisms on how to get the nation's fiscal house back in order. Thus far, traders have sold into the uncertainty.
The Dow, S&P 500 and Nasdaq all have all shed more than 3% in the past two days. The Dow and Nasdaq are both at late July levels, while the S&P 500 is at its lowest point since early August. Conversely, the yield on the 10-year U.S. Treasury bond has slumped to its lowest level since October 3 as traders have bought up the safe-haven asset.
President Barack Obama is expected to make his first remarks from the White House since his victory in securing a second term. He is expected to discuss the economy as well as the fiscal cliff -- a painful mixture of spending cuts and tax hikes that go into effect in January. House of Representatives Speaker John Boehner, the highest ranking Republican, is also set to speak on the day. The President and Speaker have had an oftentimes contentious relationship, navigating the crisis over the debt ceiling and other highly-polarized scuffles.
On the economic front, a reading on consumer sentiment from Reuters and the University of Michigan for early November rose to 84.9 from 82.6 in October, topping expectations for a reading of 83. The reading was the highest since July 2007. The measure often has a market impact, especially within the consumer discretionary and consumer staples sectors.
Wholesale inventories jumped 1.1% in September on a month-to-month basis, far bigger than the 0.4% increase expected. Generally, rising inventories are seen as a sign that firms are expecting greater sales and tends to be bullish for economic growth.
A separate report showed U.S. import prices rose 0.5% in October from September while export prices remained unchanged. Economists were expecting import prices to remain unchanged and export prices to rise 0.2%.
In Europe, talks between Greece and the European Union and International Monetary fund over a crucial aid package dragged on. A decision may not be made next week on a $40 billion rescue package, according to a report by Bloomberg News. However, the country is still unlikely to default on a debt payment that is also due next week, the report that cites unnamed sources said.
Commodities markets were to the upside. The benchmark crude oil contract jumped $1, or 1.2%, to $86.13 a barrel. Wholesale New York Harbor gasoline soared 3.1% to $2.686 a gallon.
Gold rose $6.90, or 0.4%, to $1,733 a troy ounce.
The Euro Stoxx 50 rose 0.03% to 2480, the English FTSE 100 dipped 0.11% to 5770 and the German DAX slipped 0.58% to 7164.
In Asia, the Japanese Nikkei 225 skidded lower by 0.9% to 8758 and the Chinese Hang Seng dropped 0.85% to 2241.