Dow: +56.46, Nasdaq: +6.12, S&P: +4.12
10-year note -8/32 yielding 4.19%
The market continued the Santa Claus rally today on news that oil inventories increased 1.2 million barrels. In addition, 4th quarter GDP was revised upward from 3.9% to 4%, indicating the economy is going along stronger than expected. Finally, Pfizer rebounded from its 2-day sell-off. While its Celebrex drug has come under fire in recent days, the company announced it would keep the drug on the shelves. The studies showing an increase in heart attack used doses at least twice as high as usually prescribed.
The 10-year Treasury dropped 8/32 on the GDP increase. An increase in GDP implies an increase in inflation and higher interest rates from the Fed. While there is disagreement about the degree of the rate hikes next year, there is almost unanimous agreement regarding tho occurrance of rate hikes. I should also note that trading volume was very thin today, so reading too much into any advance or gain is not the best idea. The last two weeks of the year are typically holidays for Wall Street.
Oil dropped in response to the 2.1 million barrel increase in inventories. However, the market rebounded later in the day to close down roughly .40/bbl.
The dollar was little changed verses either the yen or the Euro today. Trading volume was light.