Stocks Wobble after Financial Sector Boosts Markets
Crabtree, Margot, THE JOURNAL RECORD
A wary Wall Street scratched toward positive terrain with less than full-blown enthusiasm last week. As the trading session ended Friday, retail sales surprised when the Commerce Department reported a 0.3-percent increase; analysts were expecting sales to fall. That bit of good news was tempered by the Reuters/University of Michigan consumer sentiment index. The numbers fell in March, down to 72.5 from February's 73.6. The Commerce Department also reported that inventories were flat, when economists were expecting an uptick. Earlier in the week, however, financial shares climbed after a Citigroup upgrade gave investors hope for the beleaguered sector.
"The concept of an economic recovery is garnering a little more credibility," said David Joy, chief market strategist at RiverSource Investments. "We've arrived at a place where stocks are fairly valued."
The Journal Record Index also rose, adding 11.95 points, or 1.24 percent, to end at 977.09. The increase was broad, as advancing issues bypassed declining issues by a 27-to-11 count. The International Energy Agency last week boosted worldwide demand forecasts for oil, saying it expects more demand from Asian countries, especially China. "China is currently expected to account for almost a third of global oil demand growth in 2010," the IEA said.
Shares of Sonic jumped after a KeyBanc analyst upped his rating on the stock. Analyst Brad Ludington upgraded Sonic to "buy" from "hold," despite soft results anticipated from the second quarter ended Feb. 28. "We expect a shift in marketing focus, from discounts and limited-time offers to new products and the differentiated 'Sonic experience' with skating carhops, combined with an outsized benefit from any improvement in weather trends, will lead to traffic improvements for the drive-in brand in (the second half of the year) and beyond," wrote Ludington in a note to clients. …