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Market Recap: Stocks End Flat Despite Lack of Confidence


Commodities help stocks overcome poor economic data.

U.S. stocks shook off opening weakness to finish the session flat. The Dow Industrials fell -16 points, or -0.13% to 12,532, the S&P 500 added +3 points, or +0.23% to 1,352, and the Nasdaq Composite closed +14 points, or +0.61% to 2,341.

Financial stocks were mixed today after a JPMorgan (JPM) analyst cut Merrill Lynch's (MER) profit forecasts. According to Bloomberg, analyst Kenneth Worthington cut his estimates, saying MER would earn $2.75 per share from a previous projection of $5 per share. 2009 estimates were also cut to $5.09 per share, down from $5.57 per share. Worthington stated in a report, as reasons for the earnings cut, difficult credit markets that are "continuously challenging," with a potential $5 billion in additional writedowns. MER closed the day down -1.10% to $47.85. Other decliners included Wachovia (WB) -0.70% to $30.04 and Lehman Brothers (LEH) -3.07% to $45.21. Gainers on the day included Goldman Sachs (GS) +0.42% to $179.63, and Morgan Stanley (MS) +1.44% to $49.45. Read Toddo's Answers I Really Wanna Know.

In housing, most of the homebuilders closed the session lower after the S&P/Case Shiller home price index fell 10.7% in January from a year earlier, the largest decline on record, and 2.4% month-over-month, marking the 13th consecutive monthly decline. Leading the declines was Beazer Homes (BZH), falling -4% to $10.15. Ryland Group (RYL) lost -3% to $33.39, and Pulte Homes (PHM) dropped -2.8% to $15.05. Bucking the trend were Standard Pacific (SPF) +6.48% to $5.26, Lennar (LEN) +0.48% to $18.87, and Meritage Homes (MTH) +10.42% to $20.87. Read Professor Kevin Depew's Five Things You Need To Know.

In economic data, U.S. consumer confidence fell to a five-year low. Figures for the month of March fell to 64.5 from a revised 76.4 in February. And the Richmond Fed Manufacturing index came in at 6.0 vs. economists' expectations of -5. For more context on the economy, read Mr. Practical's How to Recognize a Bailout.

Elsewhere, shares of Monsanto (MON) surged after the company raised its 2008 forecasts above analyst estimates. The world's largest seed producer said second quarter profits would come in the range of $3.15 to $3.25 per share. Analysts expected $2.87 per share. MON settled +9.86% to $114.54.

Nokia (NOK) shares jumped 4% after CFO Richard Simonson said in a Bloomberg interview that the company was "less relatively affected than others" by a slowdown in the U.S. Shares of the world's largest maker of mobile phones settled +4.26% to $31.59.

In commodities, Crude oil recovered from opening weakness to finish +0.70 to 101.56. Gold had its first strong day in almost two weeks to finish +20.20 to 938.90. Professor Lance Lewis noted the performance in gold stocks early in the session:

"Well, gold shares act great, moving up sharply despite lower equity markets and far outpacing the rally in the GLD.

The GDX is up 4% vs. GLD up just 2%. This should squeeze these guys long the metal and short the shares and allow for the shares to outperform if we can string several days of this together.

The XAU/gold ratio's plunge below 0.2 once again nailed another buying opportunity in the shares."

Notable gainers included Agnico-Eagle Mines (AEM) +6.3% to $70.35. GoldCorp (GG) finished +7.2% to $40.01. Barrick Gold (ABX) closed +3.8% to $43.55, and Yamana Gold (AUY) added +7.7% to $16.91. Read Professor Lewis' Minyan Mailbag: Big Moves in Gold Juniors.

Silver added +0.695 to 17.762 and copper finished +4.40 to 369.90.

The dollar index fell -0.727 to 72.223.

For more Buzz insight, check out Minyanville's Buzz Bits.

Below is a recap of some of the idea flow on today's Buzz & Banter. Please note that stocks may appear in both bullish and bearish categories, due to long and short term trades by our many Minyanville professors.

Some bullish trade or investment ideas: GS, GEF, GOOG, X, SIRF, INFN, SNPS, DRYS, IYT, SOLF, FEED, TSRA, LBY, GILD, WY, RIMM, AAPL, gold shares

Some bearish trade or investment ideas: LEH, GS, SLB, LNN, FNM, FRE

See you on the hump! Have a good night!

No positions in stocks mentioned.

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