Sam Collins

Big Profits Ahead

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Stocks took a breather yesterday after rising more than 2% in the past five sessions and breaking to new highs in each of the past three. But after opening higher and then running up 60 points on the Dow Jones Industrial Average (DJI), profit-taking took over and prices fell until around 1 p.m. The remainder of the day was spent making up for the earlier selling.

The profit-takers emerged following a better-than-expected report from the Philadelphia Fed index for September, which showed a two-year high. And there were other positive economic numbers, too: Housing starts hit an annualized rate of 598,000 (expected), building permits came in at 579,000 (close to expectations), and initial jobless claims were better.

So, with stocks up in eight of the past 10 trading sessions, it seems that buyers were just primed to take profits before the weekend. Not a single major sector was able to post a gain, and each of the three major indices fell 0.3%.

FedEx (FDX) fell 2.2% after reporting that Q1 earnings fell 53%. And Oracle (ORCL) fell 2.8% after reporting lower sales for the quarter ending in August.

At the close, the Dow fell 8 points to 9,784, the S&P 500 (SPX) was down 3 points to 1,065, and the Nasdaq (NASD) fell 6 points to 2,127. 

The NYSE traded 1.5 billion shares with decliners ahead by 17-to-13. The Nasdaq had more winners than losers by a small margin, and volume was at 755 million shares.

October crude oil fell 4 cents to $72.47 a barrel, and the Energy Select Sector SPDR (XLE) lost 27 cents, closing at $55.62. 

December gold fell $6.70 to $1,013.50 an ounce. The PHLX Gold/Silver Index (XAU) closed at $171.09, off $3.08.