what moved the market last night ,cnn report

Stocks back on a tear
Dow closes solidly in positive territory above 11,000 as oil gives up another 3 percent; Market says OK to Bernanke.
February 15, 2006: 4:09 PM EST


NEW YORK (CNNMoney.com) - Stocks switched to the passing lane once again Wednesday, adding to Tuesday's big rally as oil prices dropped another 3 percent and new Fed Chairman Ben Bernanke gave investors no reason to head for the exit.

The Dow Jones industrial average (up 24.82 to 11,053.21, Charts) ended about 0.3 percent higher and the broader Standard & Poor's 500 (up 4.07 to 1,279.60, Charts) index gained around 0.4 percent, according to early tallies.



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The Nasdaq composite (up 12.21 to 2,274.38, Charts) rose roughly 0.6 percent.

Oil tumbled $1.92, the dollar gained on the euro and yen and long term Treasuries rose modestly.

Wednesday's market movers
Oil prices fell rapidly in the afternoon after declining slightly early on following a strong weekly oil inventories report.

U.S. light crude oil for March delivery fell $1.87, or over 3 percent, to $57.70 a barrel on the New York Mercantile Exchange. Oil gave up around 3 percent Tuesday as well and, combined with strong retail sales, helped the Dow gain over 1.3 percent and close above the psychologically important 11,000 mark for the first time in over a month.

Stocks dipped into negative territory earlier in the session Wednesday and could have easily given back gains following Tuesday's big rally.

"If we had reversed oil or if Bernanke was not able to stay in the middle of the road the market would have sold off," said Art Hogan, chief market analyst at Jefferies & Co. "But no news is good news."

In his first public testimony since replacing Alan Greenspan two weeks ago, Bernanke performed as expected.

He told Congress that the economy was strong last year despite obstacles including inflation and hurricanes, and that the outlook for 2006 was positive too.

He also talked about the risks of greater inflationary pressures this year, including higher energy prices, and noted that at the last Fed meeting in January -- the last with Greenspan -- the bankers had implied that more rate hikes may be needed. He cited that as "an assessment with which I concur."

At the January meeting, the central bank opted to boost its key short-term rate a quarter-percentage point to 4.5 percent, the 14th consecutive hike since late June 2004.

"I think he was signaling to the market that yes, there is another (quarter-point) rate hike coming in March and possibly in May, but that will be data dependent," said Stuart Hoffman, chief economist at PNC Financial Services Group. "He essentially confirmed what the market has already been pricing in, in terms of rate hikes."

In addition to prepared remarks, Bernanke was answering questions posed by the lawmakers on the House Financial Services Committee.

What's moving?
The market turned mixed after an upbeat morning as gains in financials, home builders and biotech stocks vied with weakness in technology and commodity names.

Some of Tuesday's big gainers slipped, including Dow Alcoa (down $0.61 to $30.76, Research) which fell around 2 percent.

Other Dow losers included American International Group (down $0.11 to $68.28, Research) and McDonald's (down $0.34 to $36.03, Research), which both fell roughly 1 percent.

On the positive side, Merck (Research) gained over 1 percent after the drugmaker said regulators agreed to review its application for a new diabetes drug, putting the company about 6 months ahead of its rivals in bringing the product to market.

General Motors (down $0.09 to $21.83, Research) gained over 1 percent and Verizon (Research) climbed nearly 2 percent.

And financial stocks jumped, sending the Amex Securities Broker/Dealer (Charts) index up about 1 percent.

Hewlett-Packard held steady ahead of its much-anticipated quarterly earnings report, due out after the close of trading.

Market breadth was positive. On the New York Stock Exchange, winners topped losers by about 9 to 7 on volume of 1.4 billion shares. On the Nasdaq, advancers topped decliners 3 to 2 as 1.5 billion shares changed hands.

Investors also took in a bullish morning read on manufacturing. The February NY Empire State index clocked in at 20.3 versus forecasts for a drop to 18.

A separate report showed a surprise drop in industrial production.

Treasury prices inched higher, with the yield on the 10-year note falling to about 4.60 percent. Bond prices and yields move in opposite directions.

In currency trading, the dollar rose against the euro and yen.

COMEX gold for April delivery fell $6.20 to $542.70 an ounce.

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