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Wall Street Shares Slip

February 14, 2013 by Leave a Comment

Stocks dipped on Wall Street at the opening of trading Thursday but then turned flat in the wake of weaker-than-expected growth data from Europe and Japan, though news on mergers and acquisitions may lead some traders to see further value in the market even after its recent gains.

The Standard Poor’s 500-stock index, the Dow Jones industrial average and the Nasdaq composite index were all nearly unchanged in morning trading.

A contraction of 0.6 percent in gross domestic product in the euro zone was the steepest for the bloc since the first quarter of 2009, while Japan’s G.D.P. shrank 0.1 percent in the fourth quarter, crushing expectations of a modest return to growth.

Though weakness in Europe has persisted over recent quarters, its implications for global growth and American corporate profits spurred some profit-taking on Wall Street.

The S.P. 500 had gained 6.6 percent so far this year, though a dearth of fresh incentives kept trading thin over the past few sessions.

A government report showed the number of Americans filing new claims for unemployment benefits fell more than expected in the latest week. That suggests the job market is improving, said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.

“But it won’t be much of a catalyst for the market this morning,” he said, because of the news out of Europe.”

Mr. Cardillo said a weaker euro, down 0.8 percent versus the dollar, was also a downward pressure on markets.

Merger and acquisition activity indicated investors saw some value in the market.

H.J. Heinz shares jumped 20 percent after it said that Warren Buffett’s Berkshire Hathaway and 3G Capital will buy the company for $72.50 a share, or $28 billion including debt.

American Airlines and US Airways Group said they plan to merge in a deal that will form the world’s biggest air carrier, with an equity valuation of about $11 billion. US Airways shares rose 3.5 percent.

Wall Street stocks closed little changed in light trading Wednesday.

Article source: http://www.nytimes.com/2013/02/15/business/daily-stock-market-activity.html?partner=rss&emc=rss

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Stock Indexes End Mixed

February 14, 2013 by Leave a Comment

The stock market lacked direction on Wednesday, as a slump in McDonald’s stock helped pull the Dow Jones industrial average below 14,000. Other major market indexes were marginally higher.

McDonald’s was among the biggest decliners in the Dow, losing $1.10, to $94, as investors worried that Americans were spending less on eating out after a rise in Social Security taxes at the beginning of the year. The government reported early Wednesday that spending by Americans barely grew last month.

Other fast-food companies also fell. Buffalo Wild Wings stock plunged $4.52, to $76.55, after its earnings fell short of analysts’ expectations. Burger King and Wendy’s also fell.

“Consumer spending is coming under pressure,” said Bryan Elliott, an analyst at Raymond James. “It’s the easiest way to save money; stay at home and cook.”

The Dow Jones industrial average fell 35.79 points, or 0.26 percent, to 13,982.91. The Dow is still up 6.71 percent so far this year and is just 182 points below the record close of 14,164 set on Oct. 9, 2007.

The Standard Poor’s 500-stock index edged up 0.90 point, or 0.06 percent, to 1,520.33. The index climbed as high as 1,524.69 during the day, the highest since November 2007. It is up 6.6 percent so far this year.

The Nasdaq composite index rose 10.38 points, or 0.33 percent, to 3,196.88.

Investors sent General Electric and Comcast higher after G.E. agreed Tuesday to sell its stake in NBCUniversal to Comcast for $16.7 billion. G.E. said it would use up to $10 billion of the money to buy back its own stock. Shares of G.E. rose 81 cents, to $23.39. Comcast advanced $1.16, to $40.13.

Trading has been relatively quiet in recent days after a strong opening to the year.

“We’re cautiously optimistic on stocks,” said Colleen Supran, principal at Bingham, Osborn Scarborough. “There is some indication that we could be continuing on this slow growth trajectory.”

Ms. Supran said investors should still be prepared for volatility in the stock market and not assume that the gains from January and so far in February will set the pattern for the rest of the year.

Strengthening the economy and creating jobs were major topics in President Obama’s State of the Union address Tuesday. Although the economy is healthier than it was four years ago, growth remains slow and unemployment high.

Among the stocks on the move, Groupon rose 28 cents, to $5.57, after the brokerage firm Sterne, Agee Leach, raised its rating on the company to buy from neutral, citing the long-term potential for Groupon’s changing business model. The online deals company has lost almost three-quarters of its value since going public in November 2011 at $20 as revenue growth slowed.

On Wednesday, the price of the 10-year Treasury note fell 13/32, to 96 15/32. The yield rose to 2.03 percent, from 1.98 percent Tuesday.

Article source: http://www.nytimes.com/2013/02/14/business/daily-stock-market-activity.html?partner=rss&emc=rss

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Stock Indexes Are Mixed

February 13, 2013 by Leave a Comment

Wall Street opened mixed on Wednesday, staying close to multiyear highs for stock indexes.

The Standard Poor’s 500-stock index rose 0.3 percent in morning trading, the Dow Jones industrial average slipped 0.1 percent and the Nasdaq composite index jumped 0.5 percent. European markets were up moderately in afternoon trading.

Equities have been strong performers of late, buoyed largely by healthy growth in corporate earnings, with the S.P. 500 gaining 6.5 percent so far this year. The Dow is about 1 percent from an all-time intraday high, reached in October 2007.

The recent gains could leave the market vulnerable to a pullback as investors take profit amid a dearth of new trading catalysts. While analysts continue to see an upward bias in markets, recent daily moves have been small and trading volumes have been light.

“This is a market that refuses to go down, and the trend suggests that we’ll not only hit a new high on the Dow, but move well beyond it,” said Adam Sarhan, chief executive of Sarhan Capital in New York.

Industrial and construction shares will be in focus following President Obama’s State of the Union address on Tuesday, during which he called for a $50 billion spending plan to create jobs by rebuilding degraded roads and bridges. He also backed higher taxes for the wealthy.

Deere Co. reported earnings that beat expectations and raised its full-year profit outlook. After initially rallying in premarket trading, the stock turned 1 percent lower.

Comcast agreed late Tuesday to buy General Electric’s remaining 49 percent stake in NBCUniversal for $16.7 billion. Comcast jumped 8.9 percent while G.E., one of the stocks in the Dow average, was up 3.1 percent.

According to the latest Thomson Reuters data, of 353 companies in the S.P. 500 that have reported fourth-quarter results, 70.3 percent have exceeded analysts’ expectations, above a 62 percent average since 1994 and 65 percent over the past four quarters.

Retail sales rose 0.1 percent in January, as expected, as tax increases and higher gasoline prices restrained spending. The data barely moved the markets.

Wall Street stocks closed modestly higher Tuesday.

Article source: http://www.nytimes.com/2013/02/14/business/daily-stock-market-activity.html?partner=rss&emc=rss

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S.&P. Extends Its Rally to a Five-Year High

February 8, 2013 by Leave a Comment

The Standard Poor’s 500-stock index edged up to a five-year high on Friday, extending a rally that started in January.

The S. P. 500 rose 8.54 points, to 1,517.93, closing up 0.3 percent for the week. The index is at its highest point since November 2007 and has advanced for six weeks, the longest streak of gains since August.

The Dow Jones industrial average rose 48.92 points, or 0.35 percent, to 13,992.97.

The Dow had its best January in almost two decades and closed above 14,000 on Feb. 1 for the first time since 2007. The index is up 6.78 percent so far this year; the S. P. 500 is up 6.43 percent.

The Nasdaq composite index climbed 28.74 points, or 0.91 percent, to 3,193.87.

A last-minute budget deal in Washington to avoid tax increases and spending cuts has helped to power the rally, on top of optimism about housing and gradual improvements in the jobs market.

The S. P. 500 finished the week higher despite logging its biggest daily decline in almost three months on Monday after worrying news from Europe. The index fell 1.2 percent that day as bond yields in Spain and Italy rose on concern that the region’s politicians would drag Europe back into crisis. The European Central Bank president, Mario Draghi, made cautious comments about the region’s economy on Thursday, which also weighed on markets.

“Everybody seems to be saying this market needs to correct,” said Robert Pavlik, chief market strategist at Banyan Partners. “Nobody wants to be in it, but nobody wants to be out of it.”

Largely positive corporate earnings reports and a report that showed that the United States trade deficit narrowed sharply in December provided more fuel for the market’s advance on Friday.

The trade deficit fell nearly 21 percent in December from November, to $38.5 billion, the smallest point in nearly three years, as exports rose while oil imports plummeted. The smaller trade gap means the economy most likely performed better in the final three months of last year than first reported last week.

“The trade balance was surprisingly very good,” said Philip J. Orlando, chief market strategist at Federated Investors.

The government estimated that the economy contracted at an annual rate of 0.1 percent in the last three months of 2012. Mr. Orlando said that may now be revised to growth of 0.5 percent.

Shares of LinkedIn, the online professional networking service, jumped $26.39, or 21.27 percent, to $150.48, after the company reported fourth-quarter results late on Thursday that beat analysts’ forecasts.

AOL shares soared $2.31, or 7.35 percent, to $33.72, after the company said its quarterly revenue grew for the first time in eight years, helped by strength in worldwide advertising.

Analysts are expecting earnings for the fourth quarter of 2012 to rise 6.5 percent for S. P. 500 companies, according to data from SP Capital IQ. That is an increase from the 2.4 percent growth rate recorded for the preceding quarter.

Stocks have benefited as investors poured a net $4.1 billion into stock mutual funds since the start of the year, according to data provided by Lipper.

“I’m very encouraged by the fact that, finally, for the first time in many years, individual investors seem to be participating in this,” said David Kelly, chief global strategist at J. P. Morgan Funds.

The Treasury’s benchmark 10-year note rose 2/32, to 97 4/32, and the yield fell to 1.95 percent from 1.96 percent late on Thursday.

Trading volume was light as Wall Street braced for a large winter storm. Up to two feet of snow was forecast along the densely populated Interstate 95 corridor from the New York City area to Boston and beyond.

Article source: http://www.nytimes.com/2013/02/09/business/daily-stock-market-activity.html?partner=rss&emc=rss

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Wall Street Takes a Step Backward

February 7, 2013 by Leave a Comment

Stocks dropped on Thursday after retailers posted mixed monthly sales and the euro fell against the dollar.

The Standard Poor’s 500-stock index ended down 0.2 percent, while the Dow Jones industrial average fell 0.3 percent and the Nasdaq composite index declined 0.1 percent. European markets ended mostly lower.

At a news conference, Mario Draghi, head of the European Central Bank, said the euro exchange rate was important to growth and price stability, remarks that investors took as a sign the bank was concerned with the single currency’s recent advance. The euro fell to $1.3385.

Mr. Draghi denied that the E.C.B. was trying to influence the value of the euro, but he then made statements that markets interpreted as meaning the E.C.B. could take action if the euro rises too much.

Separately, the United States government said that weekly initial jobless claims dipped by 5,000 to 366,000. The four-week moving average fell to its lowest level since March 2008, signaling that the economy is continuing to recover slowly.

Another report showed that fourth-quarter productivity registered its biggest drop in nearly two years, while unit labor costs jumped 4.5 percent, more than economists expected.

“Claims didn’t look too exciting. They are pretty much in line,” said Peter Jankovskis, co-chief investment officer at OakBrook Investments in Lisle, Ill. “The bigger surprise was the jump in unit labor costs that was pretty substantial. Over all, the market took the whole thing in stride.”

Several American retailers reported mixed January sales results, as consumers faced a hit to their take-home pay from higher payroll taxes. Macy’s shares rose 2 percent after the company reported that January same-store sales rose 11.7 percent.

Greenlight Capital, run by the fund manager David Einhorn, said on Thursday that it had sued Apple, saying the company should do more to unlock value for shareholders. Apple shares gained 1.8 percent.

Sprint Nextel edged down 1 percent after the mobile service provider posted higher fourth-quarter revenue, but subscriber numbers that disappointed Wall Street.

Article source: http://www.nytimes.com/2013/02/08/business/daily-stock-market-activity.html?partner=rss&emc=rss

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Wall Street Stocks Hold Steady

February 6, 2013 by Leave a Comment

Stocks ended with little change on Wall Street on Wednesday as investors found few incentives to keep pushing equities higher following a 1 percent rally in the previous session.

The three major stock indexes — the Standard Poor’s 500-stock index, the Dow Jones industrial average and the Nasdaq composite index — all were almost even with Tuesday’s close by the end of the session.

“We are a little bit at stall speed,” said Keith Bliss, senior vice president at Cuttone Co. in New York. “It wouldn’t surprise me a bit to see us consolidate around this level on the S.P. 500 for the next day or two, in the absence of some real compelling news, which is always a risk.”

Signs of political conflict in the euro zone also dented sentiment, amid signals of disagreement between Germany and France over the euro exchange rate. The spokesman for Chancellor Angela Merkel of Germany said on Wednesday that the euro is not overvalued, thus potentially reducing the chances of political intervention to curb an exchange rate that analysts say could start hurting corporate profits.

European stock markets generally pulled back, with the CAC 40 in Paris ending down 1.4 percent and the DAX in Frankfurt losing 1.1 percent. The FTSE 100 in London added 0.2 percent.

A 6 percent advance this year had lifted the S.P. 500 index to its highest level since December 2007, while the Dow briefly climbed above 14,000 points, making it a challenge for investors to continue pushing the equity market upward amid a dearth of fresh trading incentives.

Walt Disney beat estimates for quarterly adjusted earnings and said it expected the next few quarters to be better, with a stronger lineup of movies and rising attendance at its theme parks. Shares advanced 0.4 percent.

Ralph Lauren climbed 5.9 percent after the fashion retailer reported holiday quarter sales and profit that showed renewed momentum.

Time Warner gained 4.1 percent after reporting higher fourth-quarter profit that beat Wall Street estimates, as growth in its cable networks offset declines in its film, TV entertainment and publishing units.

The benchmark S.P. index rose 1 percent Tuesday, its biggest percentage gain since a 2.5 percent advance on Jan. 2, when legislators sidestepped spending cuts and tax increases that could have hurt a fragile domestic economic recovery.

Article source: http://www.nytimes.com/2013/02/07/business/daily-stock-market-activity.html?partner=rss&emc=rss

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Dow Closes Above 14,000 for First Time Since 2007

February 2, 2013 by Leave a Comment

The Dow had been rising steadily for about a month. With auto sales strong and optimism about the jobs market high, the index was only 155 points away from its highest nominal close.

“There’s a newfound enthusiasm for the equity market,” said Jim Russell, regional investment director at U.S. Bank Wealth Management in Minneapolis.

The Dow ended Friday 149.21 points higher, at 14,009.79. The Standard Poor’s 500-stock index rose 15.06 to 1,513.17, and the Nasdaq composite index was up 36.97, to 3,179.10.

Auto sales helped. Toyota, Ford, General Motors and Chrysler all reported double-digit gains for January. The government jobs report that was released Friday was mixed, but traders seemed to focus on the positive.

The Labor Department said 157,000 jobs were added in January, which was in line with expectations. Unemployment inched up to 7.9 percent from 7.8 percent in December, but many economists were encouraged because the government now says that hiring over the last year was higher than originally thought.

The jobs number is based on a survey of employers, and the unemployment rate is based on a separate survey of households, which is why they can diverge.

Market watchers were divided over what the potential for a new high really meant for the Dow. To some, it was a reason for optimism.

“The Dow touching 14,000 — it matters psychologically,” said Peter Cardillo, chief market economist at Rockwell Global Capital in New York. “It attracts smaller investors.”

Those investors had been shying away from stocks. Since April 2011, investors have pulled more cash out of stock mutual funds than they have put in, according to the Investment Company Institute, a trade association. In the last three weeks, though, that trend has reversed, which could make January the first month in nearly two years when stock-focused funds had more money flowing in than flowing out.

To others, 14,000 was nothing but a number, and not even the best number on the board. Professional investors usually pay more heed to the S. P. 500.

Joe Gordon, managing partner at Gordon Asset Management in Durham, N.C., says he does not think the gains will last. The fact that small investors are piling back in, he said, is a sign that the market has attracted too much optimism and is headed for a fall.

After the Dow hit its high in 2007, it fell almost steadily for the next year and a half, losing more than half its value before starting to tick back up.

The Treasury’s benchmark 10-year note fell 9/32, to 96 15/32, and the yield rose to 2.03 percent from 1.98 percent Thursday.

Before Friday, the Dow had closed above 14,000 just nine times. The first time was in July 2007; the rest were in October of that year.

Article source: http://www.nytimes.com/2013/02/02/business/daily-stock-market-activity.html?partner=rss&emc=rss

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Off the Charts: For Markets, a Strong January Is a Good Sign

February 1, 2013 by Leave a Comment

That maxim of the American stock market would seem to bode well for the market this year. The Standard Poor’s 500-stock index’s gain of 5 percent made the month the 12th best January since 1950, and the 19th opening month in that period when the index rose more than 4 percent.

“If history repeats, we would expect a double-digit percentage increase in the upcoming 11 months,” said Richard Peterson, an analyst at SP Capital IQ.

Only once since 1950 has the market fallen in the last 11 months of a year when it rose 4 percent or more in January. That was in 1987, which began with the best January in the history of the index — up 13.2 percent — and ended including the worst single day ever for the index, a 20 percent plunge on Oct. 19.

On average since 1950, January gains of at least 4 percent have been followed by rises of 15.1 percent in the remainder of the year. Gains were lower when January gains were smaller, and on average the market has made no headway in years after prices fell in January.

There is, of course, no guarantee that history will repeat. In fact, during the Great Depression the opposite pattern existed. The market rose sharply during the first month of 1929, 1930, 1931 and 1934, only to plunge the rest of each year. Prices fell in the first month of 1935, which turned out to be an excellent year.

The January gains this year reflected generally strong markets around the world. As can be seen in the accompanying charts, all but two of the 20 largest stock markets in the world rose in January, and six of them — Japan, China, Britain, Switzerland, Sweden and Italy — rose more rapidly than the American market did. The two that showed losses were Brazil and South Korea.

The ranking of markets is based on World Bank calculations of total market capitalization of each market in 2011. More than half the capitalization of those 20 markets is in just the top three, the United States, Japan and China. The top five — Britain and Canada in addition to the other three — have two-thirds of the value.

The United States market is one of 10 that have more than doubled from their credit crisis lows set in 2008 or 2009, the others being Brazil, Germany, India, South Korea, Hong Kong, South Africa, Russia, Sweden and Mexico.

The only three countries in the group that are not at least 50 percent higher than their lows are all in the euro zone, where economies have been stumbling. They are France, Spain and Italy.

Floyd Norris comments on finance and the economy at nytimes.com/economix.

Article source: http://www.nytimes.com/2013/02/02/business/economy/for-markets-a-strong-january-is-a-good-sign.html?partner=rss&emc=rss

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Stocks Finish the Day Mixed After Weak Housing Report

January 28, 2013 by Leave a Comment

Stocks were mixed on Monday, lifted by good economic data on the manufacturing industry but held down by a report that the rate of home sales fell short of expectations.

The government said before trading began that orders for long-lasting goods rose in December by 4.6 percent, helped by a 10 percent gain in orders for new aircraft. The durable goods report was a sign of strength for the manufacturing sector, a crucial driver of economic growth.

A half-hour after trading began, the National Association of Realtors said its index of pending home sales fell in December, suggesting sales of previously occupied homes could slow. The report was weaker than many economists had expected.

The Dow closed down 14.05 points, or 0.1 percent, at 13,881.93. The Standard Poor’s 500-stock index fell 2.78 points, or 0.2 percent, to 1,500.18. The Nasdaq composite index added 4.59 points, or 0.15 percent, to 3,154.30.

The heavy equipment maker Caterpillar said separately that its fourth-quarter net income exceeded analysts’ expectations after adjusting for the cost of a soured deal to buy a Chinese maker of roofing supports for mines. Caterpillar said it took a big charge in the quarter because the Chinese company had misrepresented its finances.

Caterpillar was the biggest gainer in the Dow Jones industrial average, closing up $1.87, or 2 percent, at $97.45.

The Dow and the S. P. 500 are approaching their closing highs, reached on Oct. 9, 2007. The Dow is about 282 points below its high of 14,164.53; the S. P. is 65 points below its record of 1,565.

Economic data may be less likely to support the indexes because traders have become harder to impress as the data strengthened in recent weeks, said Bill Stone, chief investment strategist with the PNC Asset Management Group.

“Before, even if you came in just at expectations, that was like a victory,” he said. Because of the market’s recent upturn, he said, “you get less of a pop for just making the numbers.”

The oil company Hess was the biggest gainer in the S. P. 500, adding 6.1 percent after the company said it planned to sell its terminal network in the United States, close its New Jersey refinery and shift its focus to exploration and production.

Interest rates were steady. The Treasury’s benchmark 10-year note fell 4/32, to 97 flat, and the yield rose to 1.97 percent from 1.95 percent late Friday.

Article source: http://www.nytimes.com/2013/01/29/business/daily-stock-market-activity.html?partner=rss&emc=rss

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Economic Data Lift Stocks

January 17, 2013 by Leave a Comment

Wall Street opened higher on Thursday after cheery economic reports showed first-time claims for unemployment benefits dropped to a five-year low and housing starts surged.

“It’s great news and it should take the markets higher,” Frank Lesh, a futures analyst and broker at FuturePath Trading in Chicago, said of the data.

The Standard Poor’s 500-stock index rose 0.3 percent in early trading, hitting a fresh five-year intraday high. The Dow Jones industrial average added 0.3 percent and the Nasdaq composite index gained 0.4 percent.

The S.P. 500’s gain above September’s intraday peak of 1,474.51 points put it at its highest since late December 2007. The index closed at 1,472.63 on Wednesday.

Shares of Bank of America and Citigroup were lower after the two major banks reported results. Bank of America’s fourth-quarter profit fell from a year ago as it took more charges to clean up mortgage-related problems, while Citigroup posted $2.32 billion of charges for layoffs and lawsuits, though its fourth-quarter profit rose.

EBay’s shares rose 2.5 percent, a day after it reported holiday quarter results that just beat Wall Street expectations. It gave a 2013 forecast that was within analysts’ estimates.

Shares of Boeing extended a recent slump after the United States and other countries grounded the new 787 Dreamliner following a second incident involving battery failure. Boeing was down 0.9 percent.

Solid earnings from Goldman Sachs and JPMorgan Chase on Wednesday helped lift estimates for S.P. 500 corporate earnings slightly to a 2.2 percent gain, Thomson Reuters data showed.

With investors anticipating a lackluster earnings season, the focus will be on the corporate earnings outlook for the months ahead, analysts said.

“That gives you a bigger picture of where the economy might be headed. I think you have to stitch together all the information and get a true picture of how robust the economies of the world are,” said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.

“We’ve all dismissed what’s going to happen in this fourth quarter. Estimates are pretty low, the companies that can’t step over the lower bar are probably going to get punished.”

European markets rose. The CAC 40 index of French stocks added 0.9 percent, the DAX in Frankfurt gained 0.7 percent and the IBEX 35 in Madrid rose 0.6 percent.

Article source: http://www.nytimes.com/2013/01/18/business/daily-stock-market-activity.html?partner=rss&emc=rss

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