Market Watch 09/18/2009

Today is Friday, Weather is sunny in here.

 

The market got a boost from a new economic forecast at Barclay’s Capital, which raised its projection for growth in the nation’s gross domestic product for first three months of next year to 5 percent from 3 percent. GDP has been shrinking , although many economists think it will return to growth for the July-September quarter.

 

Analysis said the strength of the rally has surprised many investors because some of the stocks posting the biggest advances are lower-quality companies with weak balance sheets that investors only months ago feared might go out of business.

 

Financial companies and home builders have been among the biggest gainers in the recent run. Many of these companies still face major hurdles with bad and weak housing market.

 

Many analysts expect the market’s run will slow – but perhaps not stop – as investors shift their holdings from industries where the gains have been strong, like technology, to areas that have lagged.

 

The Dow rose 36.28, or 0.4 percent, to 9,820.20.  The broader Standard & Poor's 500 index rose 2.81, or 0.3 percent, to 1,068.30, while the Nasdaq composite index advanced 6.11, or 0.3 percent, to 2,132.86.

The dollar rose against other major currencies, while gold slipped.

Crude oil fell 43 cents to settle at $72.04 per barrel on the New York Mercantile Exchange.

Next week, figures on home sales and consumer sentiment could shape trading, as could a report due Monday on leading indicators. The economic snapshot is designed to predict economic activity in three to six months. Fed policymakers are almost sure to leave a key banking lending rate at a record low near zero at the conclusion of a two-day meeting Wednesday. President Obama will host the Group of 20 economic summit in Pittsburgh starting Thursday.