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Market Wrap: Global Worries Keep Market Flat

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School guards that lost their jobs demonstrate in front of
Pacific Press/Getty ImagesFollowing protests over the weekend, Greece announced an early presidential election.

By Caroline Valetkevitch

The S&P 500 (^GPSC) ended nearly flat on Tuesday as concerns about global weakness and political turmoil were offset by gains in technology and energy shares. The index managed to erase a 1.3 percent decline from earlier in the day, moving more than 26 points to its high of the day from its low.

Energy and technology shares boosted the market and the Nasdaq (^IXIC) ended the day higher. Apple (AAPL) shares climbed 1.5 percent to $114.12, giving the Nasdaq and S&P 500 their biggest boost. Small-cap stocks also bounced, with the Russell 2000 (^RUT) gaining 1.8 percent.

Advancing issues outnumbered declining ones on the New York Stock Exchange by a ratio of 1.53 to 1. Still, the number of NYSE stocks making new 52-week lows was 255, compared with just 117 making new highs.

Turmoil in Greece

"The market in general is digesting a very big move since its Oct. 15 low," said Adam Sarhan, chief executive of Sarhan Capital in New York. "Less than two moths ago we were flat for the year, so investors are hypersensitive to potential downdrafts in the market at this stage in the game."

Greece unnerved investors after the government brought a presidential vote forward in a political gamble that raised uncertainty over the country's transition out of its bailout.

Brent crude rebounded to settle up 1 percent after hitting a fresh five-year low of $65.29. Oil prices have been under pressure as the dollar strengthened and OPEC decided against an output cut, with Brent down more than 40 percent from its June high. The S&P energy index ended up 0.9 percent after losing 3.9 percent on Monday.

The Dow Jones industrial average (^DJI) fell 51.28 points, or 0.29 percent, to 17,801.2, the S&P 500 lost 0.49 points, or 0.02 percent, to 2,059.82 and the Nasdaq Composite added 25.77 points, or 0.54 percent, to 4,766.47.

Thinking About Next Week's Fed Meeting

Adding to the cautious tone was uncertainty over whether the U.S. Federal Reserve will change its pledge to keep rates near zero for a "considerable time" when policymakers meet next week.

U.S. telecom stocks led losses on the S&P 500 and Dow on concerns about an industry price war. Verizon Communications (VZ) warned that promotions in its wireless business would bite into its fourth-quarter profit. The S&P telecom index lost 3.2 percent while Verizon shares fell 4 percent to $46.92.

About 7.3 billion shares changed hands on U.S. exchanges, above the 6.5 billion average this month, according to BATS Global Markets. The S&P 500 is up 10.6 percent from its Oct. 15 close and is up 11.4 percent for the year so far.

U.S.-listed shares of Seadrill (SDRL) gained 5.2 percent to $12.17. John Fredriksen, the biggest owner of the offshore driller, purchased another 1.3 million shares in the firm to raise his stake to 24.15 percent.

What to Watch Wednesday

  • The Energy Information Administration releases its weekly reports on petroleum inventories at 10:30 a.m.
  • The Treasury Department releases its monthly budget at 2 p.m.

These companies are scheduled to release quarterly financial results:

  • Costco (COST)
  • Hovnanian Enterprises (HOV)
  • Lands' End (LE)
  • Men's Wearhouse (MW)
  • Restoration Hardware (RH)
  • Wet Seal (WTSL)
  • Vera Bradley (VRA)

 

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