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US markets end mostly higher after a late session rally
Tuesday, August 21, 2007
US stocks ended mostly higher Monday amid signs liquidity pressures may be easing and a rally in short-term Treasury bills fostered thinking the Federal Reserve might cut interest rates further. Solidly lower at mid-day, the Dow Jones Industrial Average reversed course to close 42.3 points up at 13,121.3.
A late session rally came amid evidence that available liquidity is getting to borrowers who need it, with the Fed Funds rate now trading well below the Fed's 5.25% target rate at around 5.06%.
As evidenced by the worst performing sector since late July turning in the day's best performance, it was apparent that selective bargain hunting became the mantra going into the close. Materials, which had lost about 14% since peaking on July 19, spiked 2.0% in an hour suggesting that those pricing in further downside for commodities were forced to cover. The sector closed up 1.3%.
The S&P 500 was off 0.39 points at 1,445.55, and the Nasdaq Composite edged 3.56 points higher to close at 2,508.59. Volume at the New York Stock Exchange hit 1.5 billion shares, with advancing stocks outpacing decliners 10 to 7. At the Nasdaq, 1.7 billion shares exchanged hands, with advancing stocks edging ahead of decliners 15 to 14.
Yields on Treasury bills declined sharply as money market funds unloaded asset-backed commercial paper in exchange for the shortest-maturity government debt, with three-month yields down the most since the 1987 market crash.
Indian ADRs end mixed; Patni rises 3%, VSNL down 3%
Major Indian ADRs ended the day on a mixed note. While Patni and Sterlite were the gainers, VSNL was amongst the major losers. In the technology pack, Patni Computers was up 3.32% at 19.28, Infosys Technologies was down 1.1% at 46.61, Satyam Computers was down 2.73% at 23.88 and Wipro was down a marginal 0.22% at 13.79.
In the non-tech pack, Tata Motors was down 1.94% at 16.21, HDFC Bank was down 2.25% at 82.06, VSNL was down 3% at 18.53, Dr Reddy's Lab was up 0.26% at 15.44, ICICI Bank was down 2.4% at 41.89, MTNL was down 1.63% at 6.65 and Sterlite was up 3.15% at 14.06.
