- Published on Tuesday, 28 December 2004 19:42
- Written by Clyde Noel
Since this is the last stock report for 2004, it appears Santa is providing a nice rally for all of us before the end of the year. Frankly, it feels like the market meandered most of the year, but if you look at the major indexes, it was actually a decent year for stocks.
As of Dec. 22, the Dow Jones industrials are up 3.45 percent since Jan. 1, and the Nasdaq composite is up 7.69 percent. The Town Crier index of 50 stocks is up 7.75 percent. Compared to previous years, most investors are happy.
While technology stocks have not done as well as other sectors, homebuilders, mining, energy stocks and commodities have done well because of unusual factors like low interest rates and the demand from China for
Stock issues in 2004 had to be selected cautiously because there was no leadership except for energy, where we had surging crude oil prices and higher global demand. Energy stocks like Exxon Mobile and Chevron increased more than 20 percent and utilities more than 15
General Electric did well, benefiting from an expanding global economy and the weak dollar. In the meantime, the health-care industry was the biggest loser because of the
problems with Vioxx and Celebrex.
Semiconductors had a bad year. The index for semiconductors was down more than 15
percent and leader Intel Corp. was down 26.23 for the year.
Apple Computer was up more than 200 percent, which made the Town Crier index look good. Other companies that showed good increases are Adobe, Coherent, eBay, Heritage Bank, Network Appliance, McAfee
Inc, Symantec and Verisign.
In another vein, the stock-option programs that created legions of millionaires in Silicon Valley took a serious blow when the nation's accounting rule makers decided companies would have to start deducting the value of options from their profit beginning next year.
Shareholders calling for more detailed disclosures on corporate financial statements welcomed the rule.
Stock options are perks given to employees that allow them to buy shares of their company's stock in the future at a set price.