AI
Monday, January 29, 2007 8:39:38 PM
Market Update 070129
http://biz.yahoo.com/mu/update.html
4:20 pm : Stocks finished in similar fashion to the way they opened, relatively flat, as investors weighed positive developments like plunging oil prices and M&A activity against mixed earnings news and uncertainty heading into a two-day FOMC meeting. On Wednesday, policy makers are likely to keep rates unchanged again but underlying nervousness suggests the policy directive may exhibit a more hawkish stance than previously thought.
With another 25% of the S&P 500 reporting results this week, earnings were a focal point Monday. However, Dow component Verizon (VZ 38.04 +0.21) merely beating estimates by a penny also served as a reminder that there have been very few blowout numbers.
A batch of M&A news was also noteworthy; but the lack of any blockbuster deals left the market redirecting some of its focus to a slew of economic data out later in the week, especially the upcoming Fed policy statement. Laureate Education (LAUR 60.80 +6.39) going private was the biggest deal today. However, its proposed $3.8 bln management-led takeover was overshadowed by Merrill Lynch's (MER 92.44 -2.09) smaller $1.8 bln deal for First Republic (FRC 53.69 +15.39), but a 46% premium that drew criticism from MER shareholders. Ensuing weakness throughout the brokerage group removed some notable leadership from the most influential of all S&P sectors -- Financials.
Posting a similar 0.5% decline was Energy. Albeit holding up rather well early on, even as oil prices were down about 1.5%, the commodity slipping to as low as $53.75/bbl (-3.0%) in afternoon trade eventually took a toll on the sector. Crude for March delivery plunged 2.6% and closed below $54/bbl after a Saudi Official said current oil prices are adequate for consumers and producers. Oil's sell-off removed notable Energy leadership that exacerbated the afternoon downturn.
Among the five sectors attracting buyers, Industrials turned in the best performance as several transportation components reaped the benefits of lower energy prices. Dow component Caterpillar (CAT 61.77 +0.68), which got a boost after competitor Cummins (CMI 127.47 +2.40) issued upside 2007 earnings guidance, provided additional sector support.
Technology was also in focus, but the sector's gain was modest at best as strength came primarily from three components. Intel (INTC 20.89 +0.36) surged 1.8% after revealing a new technology to make smaller and faster chips. Fellow Dow component IBM (IBM 98.60 +1.15) advanced 1.2% following a similar technological breakthrough while Hewlett-Packard (HPQ 42.48 +0.79) was the Dow's best performer (+1.9%) after Prudential raised estimates and their price target on HPQ to $36 from $33. BTK +0.2% DJ30 +3.76 DJTA +1.1% DJUA -0.1% DOT +0.3% NASDAQ +5.60 NQ100 +0.1% R2K +0.6% SOX -0.6% SP400 +0.4% SP500 -1.56 XOI -0.5% NASDAQ Dec/Adv/Vol 1255/1779/1.94 bln NYSE Dec/Adv/Vol 1476/1816/1.50 bln
10:00 am : The indices have improved somewhat since the last update but only enough to abandon their neutral stance. Of the eight sectors now trading higher, Consumer Staples is pacing the way as Food Retail (+1.6%) gets a lift from an analyst upgrade on Kroger (KR 24.98 +0.47); but its modest 0.4% advance and defensive nature also play into the limited participation on the part of buyers.
The absence of leadership from the more influential Financials sector, as investors question the 46% premium Merrill Lynch (MER 93.18 -1.35) is paying for First Republic (FRC 53.61 +15.31), is also preventing a more convincing upturn since the opening bell. DJ30 +36.26 NASDAQ +1.35 SP500 +2.71 NASDAQ Dec/Adv/Vol 1236/1315/178 mln NYSE Dec/Adv/Vol 1226/1491/84 mln
09:40 am : Stocks open with little fanfare as investors struggle to find much in the way of market-moving news to set a more decisive tone. With another 25% of the S&P 500 reporting results this week, earnings are again a focal point. However, Dow component Verizon (VZ 37.52 -0.31) merely beating estimates by a penny also serves as a reminder that there have been very few blowout numbers.
Today's M&A news is also worth noting; but the lack of any blockbuster deals also leaves the market redirecting some of its focus to a slew of economic data out this week, especially Wednesday's FOMC meeting and what the accompanying policy directive will imply about further rate hikes. DJ30 +5.54 NASDAQ -1.71 SP500 -0.12 NASDAQ Vol 86 mln NYSE Vol 48 mln
09:15 am : S&P futures vs fair value: -0.8. Nasdaq futures vs fair value: -4.0.
09:00 am : S&P futures vs fair value: -1.0. Nasdaq futures vs fair value: -4.0. A modestly negative bias persists in pre-market action as both the S&P 500 and Nasdaq 100 futures still trade below fair value. The absence of economic data this morning is noteworthy, especially with reports of late diminishing hopes of a Fed rate cut anytime soon.
However, the market remains more concerned with the news that will come later this week, with some nervousness as to whether the wording in Wednesday's Fed policy statement will lean more towards a risk of raising rates later in the year. Friday's closely-watched employment report will also likely act as an overhang for the next few days.
http://biz.yahoo.com/mu/update.html
4:20 pm : Stocks finished in similar fashion to the way they opened, relatively flat, as investors weighed positive developments like plunging oil prices and M&A activity against mixed earnings news and uncertainty heading into a two-day FOMC meeting. On Wednesday, policy makers are likely to keep rates unchanged again but underlying nervousness suggests the policy directive may exhibit a more hawkish stance than previously thought.
With another 25% of the S&P 500 reporting results this week, earnings were a focal point Monday. However, Dow component Verizon (VZ 38.04 +0.21) merely beating estimates by a penny also served as a reminder that there have been very few blowout numbers.
A batch of M&A news was also noteworthy; but the lack of any blockbuster deals left the market redirecting some of its focus to a slew of economic data out later in the week, especially the upcoming Fed policy statement. Laureate Education (LAUR 60.80 +6.39) going private was the biggest deal today. However, its proposed $3.8 bln management-led takeover was overshadowed by Merrill Lynch's (MER 92.44 -2.09) smaller $1.8 bln deal for First Republic (FRC 53.69 +15.39), but a 46% premium that drew criticism from MER shareholders. Ensuing weakness throughout the brokerage group removed some notable leadership from the most influential of all S&P sectors -- Financials.
Posting a similar 0.5% decline was Energy. Albeit holding up rather well early on, even as oil prices were down about 1.5%, the commodity slipping to as low as $53.75/bbl (-3.0%) in afternoon trade eventually took a toll on the sector. Crude for March delivery plunged 2.6% and closed below $54/bbl after a Saudi Official said current oil prices are adequate for consumers and producers. Oil's sell-off removed notable Energy leadership that exacerbated the afternoon downturn.
Among the five sectors attracting buyers, Industrials turned in the best performance as several transportation components reaped the benefits of lower energy prices. Dow component Caterpillar (CAT 61.77 +0.68), which got a boost after competitor Cummins (CMI 127.47 +2.40) issued upside 2007 earnings guidance, provided additional sector support.
Technology was also in focus, but the sector's gain was modest at best as strength came primarily from three components. Intel (INTC 20.89 +0.36) surged 1.8% after revealing a new technology to make smaller and faster chips. Fellow Dow component IBM (IBM 98.60 +1.15) advanced 1.2% following a similar technological breakthrough while Hewlett-Packard (HPQ 42.48 +0.79) was the Dow's best performer (+1.9%) after Prudential raised estimates and their price target on HPQ to $36 from $33. BTK +0.2% DJ30 +3.76 DJTA +1.1% DJUA -0.1% DOT +0.3% NASDAQ +5.60 NQ100 +0.1% R2K +0.6% SOX -0.6% SP400 +0.4% SP500 -1.56 XOI -0.5% NASDAQ Dec/Adv/Vol 1255/1779/1.94 bln NYSE Dec/Adv/Vol 1476/1816/1.50 bln
10:00 am : The indices have improved somewhat since the last update but only enough to abandon their neutral stance. Of the eight sectors now trading higher, Consumer Staples is pacing the way as Food Retail (+1.6%) gets a lift from an analyst upgrade on Kroger (KR 24.98 +0.47); but its modest 0.4% advance and defensive nature also play into the limited participation on the part of buyers.
The absence of leadership from the more influential Financials sector, as investors question the 46% premium Merrill Lynch (MER 93.18 -1.35) is paying for First Republic (FRC 53.61 +15.31), is also preventing a more convincing upturn since the opening bell. DJ30 +36.26 NASDAQ +1.35 SP500 +2.71 NASDAQ Dec/Adv/Vol 1236/1315/178 mln NYSE Dec/Adv/Vol 1226/1491/84 mln
09:40 am : Stocks open with little fanfare as investors struggle to find much in the way of market-moving news to set a more decisive tone. With another 25% of the S&P 500 reporting results this week, earnings are again a focal point. However, Dow component Verizon (VZ 37.52 -0.31) merely beating estimates by a penny also serves as a reminder that there have been very few blowout numbers.
Today's M&A news is also worth noting; but the lack of any blockbuster deals also leaves the market redirecting some of its focus to a slew of economic data out this week, especially Wednesday's FOMC meeting and what the accompanying policy directive will imply about further rate hikes. DJ30 +5.54 NASDAQ -1.71 SP500 -0.12 NASDAQ Vol 86 mln NYSE Vol 48 mln
09:15 am : S&P futures vs fair value: -0.8. Nasdaq futures vs fair value: -4.0.
09:00 am : S&P futures vs fair value: -1.0. Nasdaq futures vs fair value: -4.0. A modestly negative bias persists in pre-market action as both the S&P 500 and Nasdaq 100 futures still trade below fair value. The absence of economic data this morning is noteworthy, especially with reports of late diminishing hopes of a Fed rate cut anytime soon.
However, the market remains more concerned with the news that will come later this week, with some nervousness as to whether the wording in Wednesday's Fed policy statement will lean more towards a risk of raising rates later in the year. Friday's closely-watched employment report will also likely act as an overhang for the next few days.
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