The markets were slightly up most of the day, but traders seemed to be unsurprised by big news from Dubai and Citi. Many of the "most actives" only moved up or down a percentage point or two. It was not a day in which the market showed any conviction which was surprising given the number of potential catalysts early in the day.
The numbers:
Dow 10,501.43 +29.93 (0.29%)
S&P 500 1,114.10 +7.69 (0.70%)
Nasdaq 2,212.10 +21.79 (0.99%)
Most of today's market movement was driven by macroeconomic data and M&A news. Dubai appears to have dodged default on its sovereign debt because of aid from its neighbor Abu Dhabi which is putting up $10 billion to help Dubai fulfill its near-term obligations. At the same time S&P cut Mexico's bond rating and the premier of Greece said that his nation faces "sinking in debt." The problems with sovereign national obligations and the risks involved in investing in the paper of independent countries will certainly be a topic of concern well into next year.
Exxon Mobil Corporation (XOM) put up $41 billion to buy natural gas company XTO Energy Inc. (XTO). The deal caused speculation that there would be more consolidation in the fossil fuels energy industry pushing shares in companies like Southwestern Energy Company (SWN) much higher.
The other three pieces of news that were in the financial headlines today included the flogging that President Obama gave major banks about their lack of lending to consumers and small businesses. Some bankers made modest gestures by saying they would increase lending, but almost none of them were willing to quantify their promises. Citigroup, Inc. (C) said it would pay back its TARP funds. Investors feared dilution from a government sale of stock and pushed Citi down by 8% to $3.66. The media and several economists said that they believe the Fed will keep interest rates low when it announces its latest intentions this week.
Douglas A. McIntyre is an editor at 24/7 Wall St.
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