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DJIA Industrial Average

Sept 2

Open: 10,270.08

High: 10,320.37

Low:   10,253.96

Close: 10,320.10

Change: 50.63 (0.49%)

RSI: 78

MACD (Delta): 8.85

Strategy: The US markets remained moderately strong Thursday, as the investors cheered the fall in the initial jobless claims for the past week, and an improved sentiment helped boosted better August retail sales. This was the third successive day of rise in US markets even though market awaited monthly employment report for August due on Friday.

Commentary

Stocks advanced further in US Thursday, as the investors braced the fall in the initial jobless claims in past week, and improved retail sales for the month of August, boosted by tax free incentives in the season. There was an increase in pending home sales.

The Dow Jones industrial average gained 50 points, or 0.5%. The S&P 500 gained 9 points, or nearly 0.9%, and the Nasdaq composite rose even higher by over 1% or 23 points.

Google mopped up a gain of 2.85, or 0.6%, to 463.18, and AOL advanced 15 cents, or 0.7%. The companies agreed to extend their search partnership for five years and expanded their pact into mobile search and online video. The deal helps Google protect its dominant share of the web search business from smaller competitors. AOL has also got a favorable deal from Google.

In a major M&A activity, Burger King agreed to be acquired by New York-based private-investment firm 3G Capital Management Inc. for $24 a share, for $4 billion. The stock gained 4.7% in trading.

Hewlett-Packard was also strong, up 1.2% in the session. The company won the battle to buy 3Par after raising its offer for the maker of data-storage product 3Par, prompting rival Dell to withdraw from bidding war.

Goodyear Tire & Rubber climbed 6.3% in the session. The tire maker plans to raise prices on its consumer tires by 6% in an effort to offset rising raw-material costs from October 1.

Limited Brands added 6.1%, and J.C. Penney advanced 3.2% in the session to $21.41 following the strong show by retail stores in August.

24 out 30 Dow constituents advanced moderately in the session, and another 6 stocks closed lower.

Alcoa, Home Depot and Boeing remained particularly strong amongst the Dow components, advancing by 1.75% to 2.95%.

Consumer Discretionary 1.8%, Industrials 1.3% and Materials 1.1% were amongst the main advancing sectors in the session.

Utilities was the only sector to finish 0.2% lower Thursday.

In economic news, the Labor Department reported initial jobless claims fell by 6,000 to 472,000 for the week ended Aug. 28, better than the 475,000 forecast by economists.

Pending home sales posted a 5.2% rise to 79.4 in July from June, according to The National Association of Realtors.

Commerce Department reported factory orders picked up 0.1%, for the first time in three months.

The dollar slipped against the euro and the Japanese yen, but edged higher versus the British pound.

Oil futures for October delivery rose $1.03 to $74.94 a barrel. Gold for

December delivery added $5.30 to $1,253.40 an ounce.
The Day Ahead

Friday

ISM non manufacturing index Aug

Monthly employment report for Aug