US trading volume low amid uncertainty

STRENGTH in energy lifted US stocks yesterday as investors concentrated on adding to winning positions as the quarter winds down, but uncertainty kept trading volume light.

About 6.2bn shares traded in composite volume on the New York Stock Exchange, NYSE Amex and Nasdaq, the second-weakest of 2011 and below last year’s estimated daily average of 8.47bn.

Conviction has been weak as investors assess the effect of Japan’s earthquake and turmoil in the Middle East on corporate results.

“I don’t think a lot of people know what to do. They hear about how bullish it is to reconstruct Japan but until the disaster is quantified, they are not going to do anything,” said Shawn Hackett, president of Hackett Advisors in Boynton Beach, Florida. “When the market doesn’t know what to do, it tends to go up on low volume and down on higher volume because when people get nervous, they sell.”

Oil services stocks rose for a fifth session as investors continued to add to a sector sitting at its highest since August 2008. The PHLX oil services sector index rose 1.9 per cent. All 10 of the S&P 500’s major sectors rose, with energy 1 per cent. Volume was also weakened ahead of data on the labor front, including the ADP private-sector employment report tomorrow and the US government’s key non-farm payrolls report on Friday.

The Dow Jones industrial average gained 81.13 points, or 0.67 per cent, to 12,279.01. The Standard & Poor’s 500 rose 9.25 points, or 0.71 per cent, to 1,319.44. The Nasdaq Composite added 26.21 points, or 0.96 per cent, to 2,756.89. The S&P 500 index has risen 4.9 per cent in the first three months of the year, which would be its seventh positive quarter in the last eight.