MARKET SNAPSHOT: Energy Stocks Lead

U.S. Stock Gains

By Donna Kardos Yesalavich

The energy sector led U.S. stocks higher Friday after the International Energy Agency boosted
its estimate for global oil demand, but the gains were limited by concerns that China may soon
announce additional tightening measures.

The Dow Jones Industrial Average (DJI) rose 36 points, or 0.3%, to 10450. Chevron (CVX) was
the measure's best performer, up 1.4%, and crude-oil futures climbed above $75 a barrel, after
the International Energy Agency raised its estimate for global oil demand for 2010. However, the
industry watchdog also warned that there is a continuing "significant downside risk" to its
forecasts if the world economy were to stall.

The Nasdaq Composite (RIXF) edged up 0.4% to 2245. The Standard & Poor's 500 index (SPX)
tacked on 0.5% to 1109, with its energy sector leading to the upside while consumer and
materials stocks were also strong.

The gains came as data from China showed its August imports were up 35.2% year over year, to
$119.27 billion, better than the 25% increase that was expected by economists. That was seen as
a sign that China's government-engineered slowdown in economic growth wasn't as severe as
some had projected.

However, investors were still concerned about how China's efforts to slow its growth would
impact demand for metals and other commodities, as the country's tightening measures are likely
not over. There is speculation that China will soon roll out additional moves to put the brakes on
its growth.

In the U.S, inventories at U.S. wholesalers rose in July by the most in two years, although the
size of the increase outpaced a rise in sales of distributors.

Friday's activity comes a day after the Dow posted its sixth increase in seven sessions, leaving
the market roughly flat for the year. The recent gains, came on better-than-expected economic
data that have dimmed fears of a double-dip recession, have lifted the Dow more than 4%
already for the month of September in a strong turnaround from the worst August since 2001.

However, investors are now holding back from pushing stocks much higher. " We've had a pretty
good run so there's a little hesitation after this rebound and getting to unchanged for the year,"
said Steven Goldman, market strategist at Weeden & Co. Still, he added, "the market's still likely
to be supported by modest pullbacks. Stocks were braced for more of a possibility of a double
dip. More or less we're coming into sow growth, but not a double dip."
The U.S. Dollar Index (DXY), tracking the U.S. currency against a basket of six others, ticked up
0.1%. Treasurys fell, lifting the yield on the 10-year note (UST10Y) to 2.80%. Gold futures
slipped.

Among stocks in focus, U.S. shares of Nokia (NOK) climbed 2.7% after the handset maker said
it was replacing embattled Chief Executive Olli-Pekka Kallasvuo with Microsoft's (MSFT)
Stephen Elop. The move comes as Nokia seeks to reverse steep declines in earnings and market
share that have decimated its share price.

National Semiconductor (NSM) fell 6.7%. The analog-chip maker's fiscal first- quarter profit
nearly tripled on rebounding revenue and record gross margin, but the company forecast second-
quarter revenue below analysts' average estimate.

Deutsche Bank (DB) edged up 1.2%, erasing part of its 3.2% Thursday drop on reports that the
bank may soon issue up to EUR9 billion in new shares soon. People familiar with the matter said
a capital raise would be not only to shore up capital, but also to buy a bigger chunk of Deutsche
Postbank AG.

(END) Dow Jones Newswires

09-10-101048ET

Copyright (c) 2010 Dow Jones & Company, Inc.

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