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Markets Lower as Worries Over Syria Ease

August 30, 2013 by

American stocks fell in a thinly traded session on Friday as investors avoided making large bets before a long weekend with the situation about Syria still uncertain.

Afternoon trading was volatile, with indexes swinging between break-even levels and solid losses as Secretary of State John Kerry said in televised remarks that Syria’s government used poison gas against civilians and made the case for a limited military response.

“People are uneasy not knowing what’s going on,” said John Carey, portfolio manager at Pioneer Investment Management in Boston. “With that uncertainty and going into the Labor Day holiday, we’re seeing people step back.”

The Dow Jones industrial average was down 30.64 points, or 0.21 percent, at 14,810.31. The Standard Poor’s 500-stock index fell 5.20 points, or 0.32 percent, at 1,632.97. The Nasdaq composite index was down 30.44 points, or 0.84 percent, at 3,589.87.

Trading was light ahead of the market holiday on Monday for Labor Day. About 3.99 billion shares changed hands on the New York Stock Exchange, the Nasdaq and NYSE MKT, below the daily average so far this year of about 6.31 billion shares.

“I tend to view the weakness as a buying opportunity, barring some global crisis,” said Mr. Carey, who helps oversee about $200 billion in assets. “Syria isn’t the crisis in and of itself, but if we do take military action, there could be repercussions.”

It has been a tough month over all for stocks. The S. P. 500 fell 3.1 percent in August and lost 1.8 percent for the week in a third decline in the last four weeks.

The Nasdaq fell 1.9 percent for the week while the Dow slid 1.3 percent in its fourth consecutive weekly loss. For the month, the Dow fell 4.4 percent and the Nasdaq lost 1 percent. Only one of the 30 Dow components, Microsoft, ended higher in August.

Almost 70 percent of stocks traded on the New York Stock Exchange closed lower on Friday, while 73 percent of Nasdaq-listed shares ended in negative territory.

Video game companies were among the Nasdaq’s biggest decliners on Friday. Electronic Arts fell 3.37 percent, to $26.64, while Activision Blizzard fell 2.57 percent, to $16.32.

The chip maker OmniVision Technologies tumbled 16.08 percent on earnings weakness. It forecast current-quarter adjusted profit largely below expectations as rising competition and a slowdown of smartphone sales in the United States led to an inventory pileup.

Salesforce.com, the best performer in the S. P. 500, jumped 12.55 percent, to $49.13, after the company raised its fiscal 2014 sales outlook and reported better-than-expected revenue and earnings. The Apache Corporation, the oil and gas producer, climbed 8.95 percent, to $85.68. The company said it was selling a 33 percent stake in its Egypt oil and gas business for $3.1 billion to the state-owned Chinese oil giant Sinopec Group.

The price of the benchmark 10-year Treasury note fell 8/32, to 97 16/32, and its yield rose to 2.79 percent, from 2.76 percent late Thursday.

Article source: http://www.nytimes.com/2013/08/31/business/daily-stock-market-activity.html?partner=rss&emc=rss

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Concerns Over China Push Stocks Lower

July 26, 2013 by Leave a Comment

Stocks on Wall Street closed slightly higher Friday following a slew of mixed earnings reports, and despite fears that an overhaul of China’s industry could slow down the world’s second-largest economy.

By the end of trading the Standard Poor’s 500-share index and the Dow Jones industrial average were up less than 1 percent, and the Nasdaq composite was 0.2 percent higher.

Amazon.com reported a loss for the second quarter, but shares rose 2.9 percent.

Beijing has ordered companies to close factories in 19 industries where overproduction has led to price-cutting wars, affirming its determination to push ahead with a painful makeover of the economy. That move followed weak manufacturing data on Wednesday. China’s Shanghai Composite dropped 0.5 percent to 2,010.85.

In Europe, Britain’s FTSE 100 index ended the day down 0.5 percent to 6,554.79 points, while Germany’s DAX fell 0.7 percent to 8,244.91.

France’s CAC 40 bucked the trend, rising 0.3 percent to 3,968.84. It was bolstered by a 3.6 percent rise in the shares of LVMH, the luxury goods maker, after it reported higher earnings. Meanwhile, shares in French media company Vivendi were up 0.6 percent after it agreed to sell most of its majority stake in video games maker Activision.

Over all, trading has been quiet in recent days as a lot of people wait for next week’s meeting of the Federal Open Market Committee in the for guidance on when the central bank will start reducing its monetary stimulus.

Since late last year, the Fed has been buying $85 billion in Treasury and mortgage bonds a month — a move that has kept long-term rates near record lows and supported economic recovery.

In Asia, Japan’s Nikkei 225 index fared worst on Friday, closing 3 percent lower at 14,129.98, due to a big rise in the yen, which risks making the country’s exports less competitive on international markets.

Japan on Friday said consumer prices rose in June for the first time in more than a year, an early sign that the government’s stimulus policies are working. While that is a promising sign in the long-term, the signs of inflation suggest interest rates could eventually increase — higher rates tend to strengthen a national currency. The dollar was down 0.9 percent against the yen, at 98.34 yen.

Elsewhere in the region, Hong Kong’s Hang Seng gained 0.3 percent and Australia’s SP/ASX 200 rose 0.1 percent.

In energy trading, benchmark crude was down 79 cents at $104.70 a barrel in electronic trading on the New York Mercantile Exchange.

Article source: http://www.nytimes.com/2013/07/27/business/daily-stock-market-activity.html?partner=rss&emc=rss

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Another Day of Slight Movement on Wall Street as Investors Weigh Data

July 25, 2013 by Leave a Comment

Gains in energy and chemical companies helped nudge the stock market higher on Thursday.

The modest move extends a pattern this week: even with plenty of earnings news from big companies, the broader market has shuffled between minor gains and minor losses.

Cabot Oil and Gas and Range Resources reported revenue and earnings that trumped estimates, sending their stocks up 7 percent. Cabot rose $4.85 to $76.56. Range Resources rose $5.34 to $81.39.

Facebook soared 30 percent after reporting earnings late on Wednesday that easily beat analysts’ forecasts, thanks to higher revenue from advertisements on mobile devices. Facebook’s stock gained $7.85 to $34.36.

Nearly halfway through the second-quarter earnings season, the overall trend looks good, but not great, said Tyler Vernon, chief investment officer of Biltmore Capital in Princeton, N.J. “There have been some big disappointments, like Caterpillar yesterday, but we’re seeing better and better numbers coming out.”

The Standard Poor’s 500-stock index gained 4.31 points, or 0.3 percent, to close at 1,690.25.

The Dow Jones industrial average rose 13.37 points, or 0.1 percent, to 15,555.61. The Dow was held back by Home Depot and Caterpillar, which warned on Wednesday that its sales could sag.

The Nasdaq composite index gained 25.59 points, or 0.7 percent, to 3,605.19.

Analysts forecast that companies in the S. P. 500 index would report earnings growth of 4.3 percent over the same period last year, according to SP Capital IQ. At the beginning of July, the forecast was for growth of 2.8 percent. More than six out of every 10 companies have cleared analysts’ earnings targets so far.

Improving profits should help push the S. P. 500 index above 1,700 in the coming weeks, Mr. Vernon said.

D. R. Horton Inc., the country’s largest builder, and PulteGroup said orders for new houses jumped in the second quarter, but their results still fell short of what analysts had expected. PulteGroup also posted a 14 percent decline in profits.

D. R. Horton dropped $1.82, or 9 percent, to $19.38. PulteGroup lost $1.90, or 10 percent, to $16.55, the biggest drop of any stock in the S. P. 500.

“I think what you’re seeing a bit of today is people questioning what higher mortgage rates mean for housing,” said Joe Kinahan, chief strategist at TD Ameritrade in Chicago.

In the market for United States government bonds, benchmark 10-year Treasury note rose 2/32, to 92 28/32. Its yield was unchanged from late Wednesday at 2.58 percent. Late last week, it was trading at 2.48 percent.

The 10-year yield acts as a benchmark rate for most mortgage loans. A sharp increase in the rate drives up mortgage costs and could slow down sales in the housing market.

It is still very low by historical standards, thanks in large part to the Federal Reserve’s bond-buying program. The 10-year Treasury yield hit a recent low of 1.63 percent on May 3. By contrast, it was trading around 4 percent in the summer of 2008, shortly before the worst days of the financial crisis.

The Russell 2000 index of small-company stocks set another record high, gaining 10.35 points, or 1 percent, to 1,054.18. The Russell has done better than other major indexes this year, gaining 24 percent versus 19 percent for the S. P. 500 and the Dow.

Article source: http://www.nytimes.com/2013/07/26/business/daily-stock-market-activity.html?partner=rss&emc=rss

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Wall Street Indexes Close Mixed

July 23, 2013 by Leave a Comment

The Standard Poor’s 500-stock index hit an intraday record high on Tuesday before slipping in a tight-range session, while the Dow Jones industrials got a lift from upbeat earnings.

By the end of trading, the S. P. was 0.2 percent lower, the Dow Jones industrial average gained 0.1 percent and the Nasdaq composite was down 0.6 percent.

The S. P.’s decline was only its second down day in the last 14 for the benchmark index. The SP 500 has gained about 19 percent for the year.

“Valuations are decent, there’s positive monetary pressure, earnings are just O.K.” said John Manley, chief equity strategist at Wells Fargo Funds Management in New York. “It’s hard to get people excited but the market keeps grinding higher.”

“It will be slow over the summer, but the market will have an upward bias,” he said.

Shares of United Technologies, the world’s largest maker of elevators and air conditioners, led the Dow’s advance after the company raised the low end of its 2013 earnings forecast. The stock was up 3 percent.

The Dow also reached an intraday record high shortly after the opening bell, within a few minutes of the SP 500’s jump to its record intraday high.

Asian markets rose after local media outlets in China reported that the government was looking to increase investment in railroad projects to reduce gluts in steel, cement and other materials as it aimed to ensure annual economic growth did not sink below 7 percent.

The reports lifted stocks across Asia outside Japan by 1.3 percent, to their highest levels since early June. They also gave an early increase to mining stocks in London, although a lack of detail made some in the markets cautious.

A flurry of merger and acquisition activity and a sharp rally in telecommunications shares added to gains across Europe in morning trade, but by the end of the session, the FTSEurofirst 300 index was 0.2 percent lower.

Among declining shares in the United States, the online-entertainment company Netflix fell 4.5 percent, a day after it reported that its show “Arrested Development” had lured new subscribers in the second quarter — but not enough to impress investors.

United Parcel Service posted a smaller quarterly profit as customers chose slower, cheaper shipping services, especially on international routes. Its shares were 0.1 percent lower.

Benchmark crude oil in the United States gained 17 cents, to $107.11 a barrel. Investors are awaiting United States crude inventory data for further clues about the outlook for demand.

Article source: http://www.nytimes.com/2013/07/24/business/daily-stock-market-activity.html?partner=rss&emc=rss

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Wall Street Flat at the Open

July 16, 2013 by Leave a Comment

Financial markets were lackluster Tuesday as investors paused for breath ahead of testimony from the Federal Reserve chairman, Ben S. Bernanke.

In afternoon trading the Standard Poor’s 500-stock index fell 0.4 percent, the Dow Jones industrial average fell 0.3 percent and the Nasdaq was 0.3 percent lower.

Mr. Bernanke’s comments on Wednesday to lawmakers in Congress could set the tone in markets for the rest of the summer. In particular, investors will be looking for any further guidance on when the Fed will start to reduce its monetary stimulus.

The Fed is currently spending $85 billion a month buying financial assets in the hope of keeping long-term borrowing rates low and stimulating the American economy. The new money created in recent years has been one of the key drivers of markets.

Economic figures in the United States are being largely viewed through the prism of Fed policy. Tuesday’s batch of numbers did little to affect expectations. The 0.3 percent monthly rise in industrial production during June was in line with expectations while the uptick in the annual inflation rate to 1.8 percent from 1.4 percent was largely discounted because it was because of a sharp rise in gasoline prices.

“It’s certainly possible that they could begin tapering their bond purchases later this year, but the absence of higher inflation and the stubbornly high jobless rate suggests that it may not need to do so in the near-term, particularly if those growth expectations fail to materialize,” said Jim Baird, chief investment officer for Plante Moran Financial Advisors.

In Europe, the FTSE 100 index of leading British shares fell 0.5 percent to close at 6,556.35 while Germany’s DAX dropped 0.4 percent at 8,201.05. The CAC 40 in France ended 0.7 percent lower at 3,851.03.

Tuesday’s run of corporate news had little impact despite solid earnings from Goldman Sachs and Johnson Johnson. Coca-Cola’s, though, were disappointing as it reported falling profits and weak volume growth, particularly in North America.

Once Mr. Bernanke’s appearance before lawmakers is over, markets, particularly Wall Street, may return their focus to the earnings reports.

“Corporate earnings season is going to play a much bigger part in driving market sentiment in the coming weeks, than it has over the last couple of years,” said Craig Erlam, market analyst at Alpari. “With investors no longer able to rely on the Fed to drive equity markets higher, they have to make do with focusing more on the fundamentals, and nothing gives us a better overview of these than company earnings reports and their expectations for the coming quarters.”

Earlier in Asia, South Korea’s Kospi fell 0.5 percent to 1,866.36 while Hong Kong’s Hang Seng was flat at 21,312.38. China’s Shanghai Composite Index rose 0.3 percent to 2,065.72.

In currency markets, the euro was up 0.6 percent at $1.3143 while the dollar fell 0.5 percent to 99.35 yen.

Oil prices were steady, with the benchmark contract in New York down 23 cents at $106.09 a barrel.

Article source: http://www.nytimes.com/2013/07/17/business/daily-stock-market-activity.html?partner=rss&emc=rss

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Wall Street in Record Territory

July 11, 2013 by Leave a Comment

Stocks jumped on Thursday, putting the Standard Poor’s 500-stock index within range of its highest close on record, after the Federal Reserve chairman, Ben S. Bernanke, once again said monetary policy will remain “accommodative” for some time.

In afternoon trading the S. P gained 1.1 percent to 1,670 points, the Dow Jones industrial average rose 0.9 percent, and the Nasdaq composite was 1.3 percent higher.

More than 85 percent of shares on the New York Stock Exchange were higher on Thursday, led by gains in materials and technology shares.

Mr. Bernanke sparked a rally in equity futures Wednesday night after he said that the United States unemployment rate of 7.6 percent overstated the health of the job market and noted inflation was still below the Fed’s target of 2 percent.

“His speech last night was much more dovish than most people anticipated,” said Joe Saluzzi, co-manager of trading at Themis Trading in Chatham, N.J. “The negative side of that is that they keep sending conflicting signals, and it does spasm the market up and down.”

Wall Street has recently rebounded from a sell-off begun in late May after Mr. Bernanke first raised the prospect of an earlier-than-expected reduction in the Fed’s bond buying program. By the June 24 close, the S. P. 500 had fallen 5.8 percent from its May 21 record closing high of 1,669.16 points.

Coming off the Fed chairman’s latest comments, the benchmark index is poised to retest that record.

The remarks spurred a rally in shares and bonds globally on Thursday. The dollar tumbled and commodities like gold and copper were bolstered. United States-listed shares of Barrick Gold climbed 7.6 percent while Freeport McMoRan Copper Gold gained 4.4 percent.

Advanced Micro Devices jumped 10.8 percent after Bank of America Merrill Lynch upgraded it to buy from underperform.

Celgene, up 6.7 percent, was among the top performers after the company said a late-stage trial of its cancer drug Revlimid met the main goal of improving survival in newly diagnosed blood cancer patients.

Microsoft rose 2.1 percent after the company announced a reorganization that it said will allow the software maker to deliver multiple devices and services as a single company.

European shares hit five-week highs, led by growth-sensitive stocks. The FTSEurofirst 300 index was 0.6 percent higher at the close. Earlier, Asian shares hit a near-four-week high, with the Shanghai composite index closing 3.2 percent higher.

The dollar, which had touched three-year highs before the Fed remarks on Wednesday, tumbled 1.2 percent against a basket of major currencies, while the euro roared to a three-week high of $1.3209 before falling to $1.3051.

Article source: http://www.nytimes.com/2013/07/12/business/daily-stock-market-activity.html?partner=rss&emc=rss

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Middling Jobs Gain Signals a Long Path to Healthy Payrolls

June 7, 2013 by Leave a Comment

Economists were relieved that the numbers weren’t worse, given a string of other disappointing data in recent weeks, but noted that recent job trends are nowhere close to bringing the country back to full employment. At the current pace of job and population growth, it would take nearly five years to get the economy back to the low unemployment rate it enjoyed when the recession officially began in December 2007.

“I feel hopeless, and that just makes it hard,” said Sherry Lockhart, 53, of Enumclaw, Wash. She was laid off by the state’s liquor control board a year ago, when voters privatized liquor sales, and her jobless benefits are about to be slashed as a result of federal spending cuts. “I just feel I’ve done my best over the years, and I feel like I haven’t failed the system. The system has failed me, and millions more.”

Still, the cause behind the uptick in the unemployment rate, at least, was mildly encouraging: more people joined the labor force, perhaps indicating that Americans who have been sitting on the sidelines feel that they finally have a chance at finding a job.

“It’s a decent report, but it’s not by any means robust,” said Conrad DeQuadros, senior economist at RDQ Economics, a research firm. “It’s certainly not strong enough to get the Fed to make any significant changes at its meeting in June,” he said, referring to speculation that the Federal Reserve might consider tapering its stimulus measures if the jobs numbers came in strong.

The major stock market indexes — the Dow Jones industrial average and the broader Standard Poor’s 500 — were up in midday trading by about 1 percent.

Consumers have also been relatively upbeat recently. A New York Times/CBS News poll conducted May 31 to June 4 found that 39 percent of respondents believe the condition of the economy is very or fairly good, the highest share saying this both since President Obama took office and even since the recession began.

Despite signs of optimism from consumers and investors, other indicators of the health of the economy and the job market have been mixed. Average weekly hours and average hourly earnings, for example, have shown little improvement in recent months, according to the Labor Department. Wages are up just 2 percent from a year earlier, which bodes poorly for consumer spending.

“The wage gains are very disconcerting, and particularly strange when you see these surveys of employers who say they have positions they can’t fill,” said Ian Shepherdson, chief economist at Pantheon Macroeconomics. “That means they should be bidding up wages.”

Wage growth may be held back by the composition of new jobs being created, he said, as there are a lot of jobs being added in low-paying sectors like retail. Restaurants and bars, for example, have added 337,000 jobs over the last year, and that category now makes up about 7.6 percent of all payroll jobs, its largest share on record.

The other big industry to add jobs in May was professional and business services, particularly temporary help services. Temp services employment has been growing for six straight months now, and as of May, about 2 percent of all American jobs were in the sector.

The federal government, on the other hand, lost 14,000 jobs in May, presumably a result of the across-the-board federal spending cuts, known as the sequester, implemented by Congress in March.

“With the recovery gaining traction, now is not the time for Washington to impose self-inflicted wounds on the economy,” said Alan B. Krueger, President Obama’s chairman of the Council of Economic Advisers, in a statement. “The administration continues to urge Congress to replace the sequester with balanced deficit reduction, while working to put in place measures to create middle-class jobs, such as by rebuilding our roads and bridges and promoting American manufacturing.”

Over the last three months, the federal government has shed 45,000 jobs, not including the furloughs that many federal employees are being placed on. The Pentagon, for example, has said that it would furlough 680,000 civilian workers starting in early July, with most workers losing about one paid day a week.

Though difficult to measure, the sequester has probably been dragging on the private sector, both because government contractors are laying off workers and because laid off or furloughed public workers have had less money to spend at their local businesses.

“There’s surely some sequester effects in there, but that’s something that will be disentangled in years to come,” said Mr. Shepherdson.

Article source: http://www.nytimes.com/2013/06/08/business/economy/us-added-175000-jobs-in-may-jobless-rate-rises-to-7-6.html?partner=rss&emc=rss

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Depressed High-Dividend Shares Leads Market Loss

May 29, 2013 by Leave a Comment

Wall Street’s recent passion for high-dividend stocks seems to be fading.

The stock market closed lower on Wednesday, led by the same industry groups that had the biggest gains early in the year: rich dividend payers like power utilities and makers of consumer staples.

Rising bond yields have been an important factor behind that shift.

The yield on the 10-year Treasury note is near the highest it has been in 13 months after a sharp increase on Tuesday. That is giving investors who want steady income an alternative to dividend-rich stocks. Investors piled into those stocks at the beginning of the year, when bond yields were close to historic lows.

More broadly, after this year’s powerful bull run — the Dow Jones industrial average is up 16.8 percent, the Standard Poor’s 500-stock index rose 15.6 percent — investors may be running out of reasons to keep plowing money into the stock market.

“There’s a vacuum of catalysts to continue to push,” said Sam Stovall, chief United States equity strategist for SP Capital IQ. Now, Mr. Stovall said, investors are wondering: “Well, should I take some profits and sit on the sidelines and then get back in?”

Mr. Stovall noted that S. P. 500 has had a temporary pullback of at least 5 percent every year since the end of the World War II, which has not happened yet in 2013.

The Dow closed down 106.59 points at 15,302.80, a loss of 0.7 percent. That decline matched its advance the day before, when it closed at a high, the ninth time it has done so this month. The Dow was down as much as 179 points in late morning trading, then rose moderately in the afternoon.

The S. P. 500 index was down 11.70 points to 1,648.36, also 0.7 percent. The Nasdaq composite lost 21.37 points to 3,467.52, or 0.6 percent.

“At some point, interest rates will go up, and that’s obviously having some impact on stocks,” said Erik Davidson, deputy chief investment officer for Wells Fargo Private Bank. “And you’re seeing it in the sectors that you would expect. The hardest sectors hit recently have been the more dividend-driven stock sectors.”

In commodities trading, the price of crude oil fell $1.88, or 2 percent, to $93.13. Gold rose $12.20, or 0.9 percent, to $1,391.30 an ounce. The dollar fell against the euro and the Japanese yen.

The price of the benchmark 10-year Treasury rose 14/32, to 96 23/32, and the yield fell to 2.12 percent from 2.17 on Tuesday.

Article source: http://www.nytimes.com/2013/05/30/business/daily-stock-market-activity.html?partner=rss&emc=rss

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With Little to Cheer, 3 Major Indexes End Week Lower

May 24, 2013 by Leave a Comment

All three of the major stock indexes on Friday posted their first down week since mid-April, held back by lingering concern that the Federal Reserve might scale back the economic stimulus measures that have also propelled the markets’ rally.

Still, the indexes closed well off their lows in sparse trading Friday ahead of the three-day Memorial Day weekend. The Dow Jones industrial average ended slightly higher, buoyed by a 4 percent gain in Procter Gamble shares; the Standard Poor’s 500-stock index and the Nasdaq composite index both finished a shade lower.

On Friday, the Dow gained 8.60 points, or 0.06 percent, to 15,303.10. The S. P. 500 edged down only 0.91 of a point, or 0.06 percent, to close at 1,649.60. The Nasdaq dipped 0.27 of a point, or 0.01 percent, to 3,459.14. For the week, the S. P. and the Nasdaq were down 1.1 percent, and the Dow was off 0.3 percent.

A 3.3 percent jump in April orders for long-lasting manufactured goods, like refrigerators and toasters, showed that the economy might be stronger than some had thought.

“A day like today is clear evidence that there is still money on the sideline to get into equities,” said Tim Ghriskey, chief investment officer of Solaris Asset Management in Bedford Hills, N.Y. Investors, he said, are “looking for almost any excuse to get in.” Over all, the market’s declines have been short and shallow since November.

“Investors are taking advantage of down days to put more cash to work,” Mr. Ghriskey said, “especially when the decline is not based on something fundamental.”

Trading has been choppy since Wednesday as investors here and abroad grappled with the Fed’s evolving stance on stimulus. The markets have been focused on the possibility that the $85 billion a month in bond purchases made by the Fed will be scaled back later this year, after recent Congressional testimony by the Fed chairman, Ben S. Bernanke, and minutes from the Federal Open Market Committee’s latest meeting.

The minutes showed some disagreement among the policy-setting committee’s members “in terms of the approach moving forward, specifically the time frame” of the unwinding of the Fed’s stimulus efforts, said Peter Kenny, chief market strategist at Knight Capital in Jersey City, N.J.

The measures have been instrumental in a rally that has driven stocks to record highs, not counting inflation. Even as there is some fear that the Fed will exit too soon, many analysts say the eventual reduction of the bond-buying will come with an expansion of the economy and corporate earnings, which would continue to support equities.

Joe Bell, a senior equity analyst at Schaeffer’s Investment Research in Cincinnati, said many people had credited the Fed for the recent rally without considering improvement in the job market or the housing sector. “The economy in general has been on a lot better footing than perhaps people have given it credit for,” he said.

The benchmark 10-year Treasury note barely moved on Friday, adding 1/32 to trade at 97 21/32, as its yield slipped to 2.01 percent, from 2.02 percent late Thursday evening.

Procter Gamble shares rose 4 percent, to close at $81.88, after the company, the world’s largest maker of household products, brought back A.G. Lafley as its chief executive on Thursday in the midst of a major revamping.

Tesla Motors rose to a 52-week high on Friday as bets against the stock decreased, suggesting another bout of short-covering in the electric carmaker’s shares. Tesla stock jumped 4.7 percent, to $97.08, after rising as high as $97.95.

Abercrombie Fitch was among the S. P. 500’s biggest losers after the retailer cut its profit forecast and said quarterly comparable sales fell 15 percent. Its stock lost 8 percent, to close at $50.02.

Shares of Sears Holdings plummeted 13.6 percent, to $50.25, after the retailer reported a bigger-than-expected quarterly loss on Thursday.

Article source: http://www.nytimes.com/2013/05/25/business/daily-stock-market-activity.html?partner=rss&emc=rss

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Wall Street Lower on Fed Worries

May 24, 2013 by Leave a Comment

United States stocks fell for a third day on Friday, putting indexes on track for their first negative week since mid-April, on lingering concern the Federal Reserve may scale back its support to the economy.

In afternoon trading, the Standard Poor’s 500 Index dropped 0.4 percent, the Dow Jones industrial average fell 0.2 percent, and the Nasdaq Composite Index was 0.3 percent lower.

The three major indexes were on track to post their first negative week in five.

Global markets looked vulnerable to further falls on Friday, with better economic news from Europe doing little to encourage investors who are worried that central bank stimulus may curtailed.

MSCI’s world equity index, which shed 1.4 percent for its second biggest daily loss of the year on Thursday, was virtually unchanged, with losses in Europe canceling out a rise of nearly 1 percent in Japan’s turbulent Nikkei.

Trading has been choppy in the second half of the week as market participants assess the Federal Reserve’s evolving stance toward markets. The Fed’s stimulus measures have been instrumental in a rally that has driven stocks to record highs this year.

“We’ve had some volatility this week that we really haven’t experienced in a month or so, so it’s got a little bit of uncertainty here,” said Joe Bell, a senior equity analyst at Schaeffer’s Investment Research in Cincinnati.

Friday may also be a natural time for investors to take profits heading into the long weekend, with markets closed on Monday for the Memorial Day holiday, Mr. Bell said.

Even as there is some fear that the Fed will exit too soon, many analysts say the eventual tapering of the central bank’s stimulus will come with an expansion of the economy and corporate earnings, which will continue to support equities.

“A lot of people have only been giving the Fed credit for this rally and not been talking about some of the improvement in the labor market or housing data,” Mr. Bell said. “The economy in general has been on a lot better footing than perhaps people have given it credit for.”

Procter Gamble shares rose 4 percent after the company, the world’s largest household products maker, brought back A.G. Lafley as chief executive Thursday, replacing Bob McDonald, in the midst of a major restructuring.

Abercrombie Fitch was the S.P. 500’s biggest loser in the morning after the teen clothing retailer cut its profit forecast and said quarterly comparable sales fell 15 percent, which it blamed in part on inventory shortages. Its stock lost 10.2 percent.

Shares of Sears Holdings tumbled 14 percent after the company reported a bigger-than-expected quarterly loss on Thursday. Sears said cooler spring weather hurt its results.

Over all, the Wall Street’s pullbacks have been short and shallow since November as traders have taken any weakness as an opportunity to increase long positions.

Since Wednesday, the markets have been focused on the possibility that the Fed’s $85 billion per month in bond purchases will be scaled back later this year, in the wake of recent congressional testimony by the Fed chairman, Ben S. Bernanke, and the minutes from the Federal Open Market Committee’s latest meeting.

The minutes showed a degree of fracture among the committee’s members “in terms of the approach moving forward, specifically the time frame” of the unwinding of the Fed’s stimulus efforts, said Peter Kenny, chief market strategist at Knight Capital in Jersey City.

The Wall Street losses came despite a Commerce Department report that said durable goods orders rose 3.3 percent last month, exceeding expectations for an increase of 1.5 percent. Previous readings for orders were revised to show a smaller decline in March than previously estimated.

Thursday’s sell-off was concentrated in Japan’s stock market which suffered its biggest one-day percentage drop in two years, but also rattled European and American markets and sent the yen to near two-week highs against the dollar.

Japanese shares have gained nearly 70 percent in the last six months on the back of Japanese Prime Minister Shinzo Abe’s prescription of aggressive monetary and fiscal stimulus.

“The fact the market has had such a huge run over a relatively short period has left it incredibly vulnerable,” said Shane Oliver, strategist at AMP Capital.

Europe’s broad FTSE Eurofirst 300 index fell again, declining 0.2 percent after posting its biggest one-day fall in nearly 12 months on Thursday.

Although a key business survey showed sentiment in Germany was better than expected, this reduced expectations the European Central Bank would cut rates.

The Ifo survey found optimism over the economic outlook in Europe’s largest economy may be improving. A view reinforced by earlier data on German consumers.

The euro rose to hit a day’s high of $1.2959 after the German survey data, while German Bund futures cut some of the gains they had seen from the sell-off in equity markets.

Article source: http://www.nytimes.com/2013/05/25/business/daily-stock-market-activity.html?partner=rss&emc=rss

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