By Kate Gibson
The U.S. stock market's climb on Thursday had investors steering
clear of three-month lows tested earlier in the week, with the
bear-market bottom called by some in November holding for now. But
not all believe that bottom will hold.
The Dow Jones Industrial Average (DJI), which on Tuesday fell
nearly 300 points to close at 7552.6, just 0.31 points from
matching a 51/2-year low hit on Nov. 20, 2008.
The blue-chip index on Thursday wavered between positive and
negative territory, and lately churned mixed, echoing the prior
day's listless action, which had the Dow crossing zero 51 times.
The Dow was lately off 16.96 points at 7,538.67, with 17 of its 30
components trading in the black.
Financials fronted the declines, with Hartford Financial
Services (HIG) among the hard hit, its stock off 19%.
The S&P 500 Index (SPX) fell fractionally to 788.49, and the
Nasdaq Composite Index (RIXF) declined 5.83 points to stand at
1,462.14.
Nick Kalivas, an analyst with MF Global Research, said
bearish-leaning sentiment would likely propel another broad-market
run at November lows.
In looking at S&P 500 futures, "best guess for today's
range: 785 to 743," Kalivas wrote of S&P 500 futures in a note
ahead of Thursday's open.
While the Dow and S&P broke their mid-January lows earlier
in the week, the Nasdaq offered an encouraging sign by holding
above its comparable level, according to Marc Pado, U.S. market
strategist at Cantor Fitzgerald.
"Investor resolve is clearly getting tested, although I would
say that this is a balancing act between the fact that the economy
is continuing to deteriorate, although no one anticipated a
turnaround anytime soon, and the argument over the effectiveness of
the stimuli being injected from every direction," he said.
"As February continues to wilt away, I am maintaining my
thus-far-correct position that equities are not priced for a
continuation of the severe economic contractions we've seen in the
fourth quarter and first quarter," said Dan Greenhaus, an analyst
with the equity strategy group at Miller Tabak & Co. "We are,
of course, going to overshoot on the downside, but my position at
the end of last year remains the same as it does now, in the 700
range."