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Market Update 070215
http://biz.yahoo.com/mu/update.html

4:20 pm : After three consecutive days of gains, stocks looked lethargic Friday, trading in a narrow range throughout the session before closing relatively unchanged. The bulls still put up a respectable fight, however, since the Dow in the closing minutes limped into the finish with its 30th record close since October.

Among the biggest headlines stalling the market's momentum was Microsoft (MSFT 28.74 -0.72), which plunged after CEO Steve Ballmer spooked shareholders by saying analysts' sales estimates for Vista are "overly aggressive." Since the tech bellwether is one of only two stocks listed on all three major averages, Microsoft's 2.4% decline was a thorn in the market's side all day.

Also overshadowing another day of M&A was an exaggerated decline in housing starts. AMR Corp. (AMR 38.97 +0.92), a suggested holding in our Active Portfolio, is reportedly being eyed as a takeover target by a group that includes Goldman Sachs (GS 216.92 +0.10) and British Airways (BAB 112.65 +0.02). It was also reported that General Motors (GM 36.34 -0.10) is in talks to buy the entire Chrysler Group (DCX 73.33 +3.08).

Just two days ago, Fed Chairman Bernanke said he sees economic growth strengthening somewhat as the drag from housing diminishes. However, a larger than expected 14.1% decline in January housing starts to 10-year lows, whether an aberration or not due to the volatile nature of the report, failed to provide further proof that the struggling housing sector has not bottomed out.

The latest read on inflation at the wholesale level also hit the wires at 8:30 ET. Total PPI and core PPI matched economists' forecasts; but since the data won't alter inflation expectations, the report failed to provide investors with overwhelming evidence that pricing pressures are abating. The focus now turns to next week's more closely-watched CPI report.

From a sector standpoint, Honeywell (HON 47.83 +0.26) becoming the third Dow component this week to announce a sizable share buyback kept the Industrials sector in focus. However, further consolidation in railroads and weakness in the aerospace group earmarked the influential sector as the day's worst performer.

Oil prices surging 2.4% without any follow-through in energy stocks further underscored the market's cautious tone after such an impressive week for equities overall. DJ30 +2.56 NASDAQ -0.79 SP500 -1.27 NASDAQ Dec/Adv/Vol 1307/1688/1.92 bln NYSE Dec/Adv/Vol 1641/1637/1.33 bln

3:30 pm : The indices continue to trade sideways just below the flat line going into the close. Eight out of 10 sectors are still in negative territory, with declines of 0.4% from influential areas like Technology, Health Care and Industrials still acting as obstacles for buyers to overcome.

However, even if sellers stick around long enough to snap a three-day winning streak, the bulls can still claim victory for the week since the Dow, S&P 500 and Nasdaq are still on pace to close up 1.4%, 1.2% and 1.4%, respectively. DJ30 -2.66 NASDAQ -0.74 SP500 -1.64 NASDAQ Dec/Adv/Vol 1433/1538/1.58 bln NYSE Dec/Adv/Vol 1798/1443/1.07 bln