Investor sentiment still bullish despite crises

Dow Jones: 12,018.63 (-17.90) S&P 500: 1,293.77 (-4.61) Nasdaq: 2,683.87 (-8.22)WALL STREET snapped a three-day winning streak yesterday, even as investors adjusted to the insecurity created by events in Japan, the Middle East and North Africa.

The CBOE Volatility Index (VIX) fell 1.9 percent to 20.21, leaving it not far from its level before the crisis in Japan sparked a huge spike in the VIX, suggesting investors have become acclimated to Japan’s biggest earthquake and the toppling of governments across the Arab world.

The VIX has tumbled 31.6 per cent in the last four days.

“There is a palpable difference in the kind of intensity that someone like myself feels being on the trading floor,” said Gordon Charlop, managing director at Rosenblatt Securities in New York.

Volume was the lowest of the year, with 6.52 billion shares traded on the New York Stock Exchange, the American Stock Exchange and Nasdaq, pointing to a lack of conviction.

April US crude futures rose $1.67 to settle at $104 a barrel while Brent added 74 cents to settle at $115.70.

“Those that are still bullish are trying to buy on dips and took advantage of the prices from the middle of last week. But as far as upward momentum, I don’t think it’s there anymore,” said Terry Morris, senior equity manager at National Penn Investors Trust Company in Pennsylvania.

“So it’s a wait-and-see attitude and and not a lot of commitment from either side at this point.”

According to a recent report from EPFR Global, fund flows “took a marked turn towards the defensive in mid-March,” following the crisis in Japan.

ECB president Jean-Claude Trichet and other policymakers have reiterated they are ready to act to guard against inflation, despite the impact of Japan’s disasters.

Walgreen was the S&P 500’s biggest percentage loser, falling 6.6 per cent to $39.21 after it reported its quarterly results.

One of the S&P’s top percentage gainers was Netflix, which rose 4 per cent to $221.39 after Credit Suisse upgraded the stock to “outperform”. After the closing bell, Adobe Systems climbed 1.4 per cent to $33.33 and Jabil Circuit jumped 10.5 per cent to $20.91. Both companies reported quarterly results after the regular stock trading session ended. – (Reuters)