AI
Wednesday, July 16, 2008 8:00:57 PM
Market Update 080716
http://biz.yahoo.com/mu/update.html
4:25 pm : On Wednesday, the financial sector soared the most in its 19-year history after Wells Fargo (WFC 27.14, +6.63) reported better-than-expected earnings, sparking a rally that was compounded by short-covering. As a result, the stock market posted a large 2.5% gain, as a steep drop in crude prices helped overshadow a disappointingly high inflation reading.
Wells Fargo reported second quarter earnings of $0.53 per share, topping Wall Street's expectation by $0.03. In addition, the San Francisco-based bank raised its dividend by 10%, indicating it is in a solid financial position despite the current environment. The stock spiked 32% on the news.
This, along with better-than-expected earnings from Charles Schwab (SCHW 21.91, +2.69), Northern Trust (NTRS 76.00, +8.81) and Marshall & Ilsley (13.61, +2.02) sent the financial sector soaring to a 12.3% gain -- the largest advance since it was created in 1989.
It was a solid session outside of financials as well, with eight of the ten economic sectors posting an advance, aided by the second straight day of tumbling oil prices, bargain hunting and short-covering.
With regard to crude oil, prices fell 3.1% after a government report showed an unexpected crude and gasoline inventory build, sparking a rally in energy-price sensitive areas.
The consumer discretionary sector jumped 4.4%. General Motors (GM 11.46, +1.62) and Ford (F 5.49, +0.84) posted their largest one-day gain in years as investors scooped up the beaten down names. Meanwhile, retailers spiked 5.5% as oil prices eased.
Airlines surged 18% thanks to the drop in crude prices and better-than-expected earnings from American Airline parent AMR Corp (AMR 5.74, +1.33) and Delta Airlines (DAL 6.03, +1.36).
Other beaten down areas saw a surge in buying interest; the homebuilder group spiked 14% and the building product group rose 11%.
The tech sector performed roughly in-line with the market, unable to outperform despite Intel (INTC 20.91, +0.20) reporting earnings that topped estimates. The semiconductor-giant's margins were on the low side of previous guidance, which kept buying interest in check.
The energy sector was a laggard after the drop in crude prices took a toll on oil producers (-3.0%). The defensive-oriented utility sector slipped 1.9%.
On the economic front, June inflation rose by a higher-than-expected amount due to rising energy and food costs. Core inflation also was higher than expectations due to larger increases in the indexes for shelter, tobacco and smoking products, and the apparel index. Specifically, June CPI rose 1.1% month-over-month, higher than the expected increase of 0.7%. Core CPI, which excludes food and energy, rose 0.3%, which is also higher than the consensus estimate of 0.2%. CPI is now up 5.0% year-over-year (highest since 1991) and core CPI is up 2.4%.
Industrial production rebounded to a 0.5% gain in June from the decline of 0.2% in May. The gain is in part due to a 5.4% increase in the output of motor vehicles and parts as activity resumed at plants that had been idled during the American Axle strike. Separately, capacity utilization increased to 79.9% from 79.6%.
Fed Chairman Bernanke gave his semiannual testimony before the House Financial Services Committee. Much of his testimony was a rehash of his appearance before the Senate yesterday. Of note, the chairman said the GSEs (Fannie Mae (FNM 9.22, +2.15) and Freddie Mac (FRE 6.91, +1.65)) are adequately capitalized and in no danger of failing. He went on to say that action by Congress is justifiable in order to raise confidence in the GSEs.
The FOMC meeting minutes from the June 24-25 meeting were also released this session. The minutes did not provide the market with any new information, and as a result had a limited impact on trade.DJ30 +276.74 NASDAQ +69.14 NQ100 +2.5% R2K +3.7% SP400 +2.4% SP500 +30.45 NASDAQ Adv/Vol/Dec 2218/2.44 bln/670 NYSE Adv/Vol/Dec 2430/1.73 bln/759
3:30 pm : The major indices are trading at or near session highs as we go into the final half-hour of trade. The financial sector is up 10%, accounting for 15.2 points of the S&P 500's advance.
Within the S&P 500, 75% of stocks are trading higher. Most of the stocks that are posting a loss are in the energy (-2.4%) or utilities (-2.4%) sectors.DJ30 +224.23 NASDAQ +63.62 SP500 +23.97 NASDAQ Adv/Vol/Dec 2137/2.00 bln/719 NYSE Adv/Vol/Dec 2314/1.25 bln/853
3:00 pm : The financial sector continues to rally, hitting a gain of 9.3% -- the largest since the creation of the sector in 1989. By percent gain, the largest advancers are Wells Fargo (WFC 26.58, +6.08) up 29%, MGIC (MTG 4.64, +0.94) up 25%, and First Horizon (FHN 7.24, +1.35) up 23%. Despite this session's surge, the sector is down 35% this year, and is down 49% from its 52-week high -- which was reached exactly one-year ago.
The major indices climb to new highs, with the Dow and S&P 500 nearing a gain of 2%.DJ30 +207.92 NASDAQ +59.73 SP500 +21.77 NASDAQ Adv/Vol/Dec 2099/1.82 bln/737 NYSE Adv/Vol/Dec 2262/1.14 bln/901
2:35 pm : Stocks climb to session highs with financials (+8.2%) posting their largest gain since the Bear Stearns bailout. Only two of the sector's 89 components are trading lower -- Genworth Financial (GNW 14.37, -0.56) and Loews Corp (L 43.35, -0.42).
Beaten down automakers Ford (F 5.34, +0.69) and General Motors (GM 11.20, +1.36) are catching a bid. General Motors announced yesterday morning a new restrucutring plan to shore up capital through 2009. GM is up 14% this session, marking the largest one-day percent gain since surging 18% in 2005 on a better-than-expected earnings report and word that Tracinda Corp had increased its stake in the automaker.DJ30 +185.63 NASDAQ +54.41 SP500 +19.23 NASDAQ Adv/Vol/Dec 2055/1.68 bln/752 NYSE Adv/Vol/Dec 2236/1.05 bln/922
2:05 pm : The stock market trades with a solid gain as a strong advance within financial (+7.4%) and consumer discretionary (+3.1%) stocks more than offsets weakness in energy (-2.6%) and utilities (-2.1%) stocks. There was some choppy action as the minutes from the June 25 FOMC meeting were released, but stocks have managed to hold their gains.
The FOMC meetings showed that some Fed officials favored a rate rise very soon, fearing an "upward drift in long-run inflation expectations." Rates were left unchanged at the last Fed meeting, although there was a dissention that called for a rate increase.
Retailers are up 4.5%, with the drop in crude prices sparking buying interest. Activist investor William Ackman added to his $2 billion investment in Target (TGT 45.29, +1.63) after the company's stock declined 38% over the past year, according to Bloomberg.com's sources.DJ30 +155.28 NASDAQ +45.58 SP500 +15.24 NASDAQ Adv/Vol/Dec 1995/1.52 bln/791 NYSE Adv/Vol/Dec 2142/958 mln/997
1:30 pm : All three of the major indices have climbed to a fresh session high. The Nasdaq continues to outpace its counterparts, the S&P 500 and the Dow Jones Industrial Average, up 2.3% at its most recent level.
The energy sector (-2.2%) remains an underperformer for the second straight session, following oil prices lower. Its drop during recent sessions has reversed its year-to-date gain. Now, all ten of the major economic sectors are trading with a year-to-date loss.
Oil and gas explorers have been the energy sector's worst performing industry group this session; it is down 3.1%. Refiners, up 0.8%, are the only industry group in the sector to trade with a gain.DJ30 +179.45 NASDAQ +49.60 SP500 +17.08 NASDAQ Adv/Vol/Dec 2031/1.38 bln/750 NYSE Adv/Vol/Dec 2153/866 mln/991
1:00 pm : The stock market is trading at session highs, despite crude oil paring some of its losses. Oil prices are currently down 2.7% to $134.92, but were down as much as 4.9% in earlier trade.
The Nasdaq is outperforming, in part thanks to strength in Charles Schwab (SCHW 21.09, +1.87) and Research In Motion (RIMM 108.34, +2.49). Advancers outpace decliners by 5-to-2 on the Nasdaq.DJ30 +146.31 NASDAQ +40.90 SP500 +13.57 NASDAQ Adv/Vol/Dec 1957/1.23 bln/788 NYSE Adv/Vol/Dec 2072/781 mln/1040
12:30 pm : Stocks are back on the rise with financials (+6.1%) leading the charge higher. Small-cap names are outperforming, as the Russell 2000 Index advances 1.9%, compared to the S&P 500's advance of roughly 1%.
European markets closed mixed, with the FTSE falling 0.4%, while the DAX and CAC advanced 1.2% and 1.3%, respectively.DJ30 +134.52 NASDAQ +35.42 SP500 +12.65 NASDAQ Adv/Vol/Dec 1926/1.12 bln/795 NYSE Adv/Vol/Dec 2051/716 mln/1064
12:05 pm : The stock market is off its best levels, but is still sporting solid gains midday as a plummet in crude prices and a rebound in financials offset a disappointingly high inflation reading.
The market opened on a modestly higher note after Wells Fargo (WFC 25.31, +4.81) reported second quarter results that were solid when considering the current economic environment. The San Francisco-based bank reported earnings and revenue that topped expectations and also raised its dividend by 10%, sending shares 23% higher.
Other financial names reported earnings that were ahead of expectations, including Charles Schwab (SCHW 20.76, +1.54), Northern Trust (NTRS 73.02, +5.83), and Marshall & Ilsley (MI 12.55, +0.96).
As a result, the financial sector is surging 5.3%, with the diversified banks group climbing 15% -- the most since the group was formed in 1989.
After some early morning choppiness, the stock market rallied to its session high as crude prices plunged in response to a government report that showed an unexpected drop in crude oil and gasoline inventories. Crude prices are down 3.1% to $134.41, marking a two-day decline of more than 7%.
Five of the ten economic sectors are posting a gain, with strength in energy-cost sensitive areas such as consumer discretionary (+2.3%), with retailers soaring 3.0%. Airlines (+11.0%) are rallying, getting an additional boost after AMR Corp (AMR 5.26, +0.85) reported a quarterly loss that was smaller than expected.
Conversely, the energy sector is tumbling 2.3% with oil and gas exploration stocks down 3.0%.
Overall, earnings reports came out ahead of expectations, although the market's reaction has been mixed. Abbott (ABT 56.63, -1.22), Intel (INTC 20.87, +0.16) and Seagate Tech (STX 14.56, -2.74) topped estimates. Rail operator CSX Corp (CSX 61.07, +3.19) reported an in-line result.
On the economic front, June inflation rose by a higher than expected amount due to rising energy and food costs. Core inflation also was higher expectations due to larger increases in the indexes for shelter, tobacco and smoking products and the apparel index. Specifically, June CPI rose 1.1% month-over-month, higher than the expected increase of 0.7%. Core CPI, which excludes food and energy, rose 0.3%, also higher than the consensus estimate of 0.2%. CPI is now up 5.0% year-over-year (highest since 1991) and core CPI is up 2.4%.
Industrial production rebounded to 0.5% gain in June from the decline of 0.2% in May. The gain is in part due to a 5.4% increase in the output of motor vehicles and parts as activity resumed at plants that had idled during the American Axle Strike. Separately, capacity utilization increased to 79.9% from 79.6%.DJ30 +88.01 NASDAQ +28.32 SP500 +7.62 NASDAQ Adv/Vol/Dec 1880/1.02 bln/815 NYSE Adv/Vol/Dec 1986/652 mln/1115
11:30 am : The major indices run into some broad-based resistance at session highs, although the market continues to sport a solid gain. Fed Chairman Bernanke is currently answering questions from Housing Financial Services Committee members.
Of note, the chairman said the GSEs (Fannie Mae (FNM 7.91, +0.84) and Freddie Mac (FRE 5.93, +0.67)) are adequately capitalized and in no danger of failing. He went on to say that action by Congress is justifiable in order to raise confidence.
Treasures are under selling pressure on the long end of the curve. The 10-year note is down 25 ticks, and the 30-year bond is down nearly two points. The weakness in bonds is due to the stock market's recent advance and the higher-than-expected inflation reading.DJ30 +97.37 NASDAQ +28.27 SP500 +8.25 NASDAQ Adv/Vol/Dec 1816/689 mln/771 NYSE Adv/Vol/Dec 1954/465 mln/1102
11:00 am : Crude prices plummet 4.0% to $133.32 per barrel on news of the unexpected increase in crude and gasoline inventories. Crude prices are now down more than 8% over the last two days.
The news has lifted the stock market to session highs, with financials (+5.8%) and retail (+2.7%) stocks seeing the most buying interest. Conversely, the energy sector (-3.2%) quickly dropped to session lows on the spike in crude.
AMR Corp (AMR 5.37, +0.96), parent company of American Airlines, reported a second quarter loss of $284 million after fuel prices increased costs by $838 million compared to the prior year. The results, however, topped Wall Street expectations, helping to lift shares by 22%.
The better-than-expected earnings from AMR and the plummet in crude prices is lifting the Amex Airline Index to a massive 12% gain. Despite the advance, airlines are still posting a steep 55% drop this year.DJ30 +97.54 NASDAQ +28.31 SP500 +9.43 NASDAQ Adv/Vol/Dec 1632/538 mln/878 NYSE Adv/Vol/Dec 1858/362 mln/1159
10:35 am : Just hitting the wires, crude inventories for the week ended July 11 rose 2.95 million barrels, compared to the expected draw of 2.2 million. Crude prices were trading down 0.9% to $137.44 just prior to the release.
After slipping off its session high, the stock market goes back on the rise on the unexpected build in crude stockpiles.
In merger and acquisition news, Cleveland-Cliffs (CLF 103.20, -8.26), North America's largest iron-ore pellet producer agreed to buy Appalachian coal producer Alpha Natural Resources (ANR 110.76, +15.84). The price of $10 billion in stock and cash represents a 35% premium to Tuesday's closing price. The deal will enable Cliffs to diversify its mineral production and achieve greater size and scale needed to compete on a global scale for raw materials.
The materials sector is the worst performing area this session, with a loss of 1.7%.DJ30 +56.34 NASDAQ +13.12 SP500 +7.21 NASDAQ Adv/Vol/Dec 1441/395 mln/980 NYSE Adv/Vol/Dec 1470/264 mln/1465
10:05 am : The stock market briefly slips into the red, and then bounces back to hit session highs. Most of the buying interest is concentrated within financials (+4.5%), as no other sector is up more than 1%.
Wells Fargo's (WFC 25.22, +4.71) better-than-expected earnings are acting as the main buying catalyst, although the sector is also benefiting from earnings beats from the likes of Charles Schwab (SCHW 20.83, +1.61), Northern Trust (NTRS 71.74, +4.55), Marshall & Ilsley (MI 12.39, +0.80).
The diversified banks group is surging 14.0%, its largest advance in its nearly 20 year history.
Fed Chairman Bernanke will shortly testify before the House Financial Services Committee. His prepared speech will likely be very similar to his testimony before the Senate yesterday, although the question and answer session could reveal new information.DJ30 +63.91 NASDAQ +15.01 SP500 +7.45 NASDAQ Adv/Vol/Dec 1460/240 mln/865 NYSE Adv/Vol/Dec 1554/170 mln/1323
09:45 am : The stock market gets off to a slightly higher start as better-than-expected earnings news helps to offset some disappointing inflation data.
On the earnings front, Intel (INTC 20.65, -0.06), Abbott Labs (ABT 57.44, -0.35), Charles Schwab (SCHW 20.10, +0.88) and Marshall & Ilsley (MI 12.03, +0.44) reported earnings that topped expectations. The big mover is Wells Fargo (WFC 23.64, +3.11) -- the stock is up about 15% after the company reported earnings that topped expectations and raised its dividend by 10%.
June CPI rose by a larger than expected amount, which is partially offsetting the better-than-expected earnings. High energy and food prices spurred a 1.1% month-over-month jump in CPI, which was higher than the expected increase of 0.7%. Core CPI rose 0.3%, topping the expected rise of 0.2%. Total CPI is up 5.0% year-over-year, the largest increase since 1991.
Crude prices are trading down 0.8% to $137.63 per barrel after the more than 4% drop yesterday. The government will release its weekly energy inventory statistics at 10:35 ET.DJ30 -13.60 NASDAQ +2.71 SP500 +0.98
09:17 am : S&P futures vs fair value: -1.0. Nasdaq futures vs fair value: +1.0. Futures indicate a flat start to the trading day. Just hitting the wires, industrial production in June rose 0.5%, topping the expected 0.1% increase. Capacity utilization rose to 79.9%, while economists expected utilization to hold steady at 79.4%.
09:00 am : S&P futures vs fair value: -2.5. Nasdaq futures vs fair value: -6.2. Futures indicate a negative start, although they are well off their lowest levels. Charles Schwab (SCHW) reported second quarter earnings from continuing operations of $0.27 per share, which is $0.01 better than expectations. Milwaukee-based bank Marshal & Isley (MI) reported a second quarter loss of $1.52 per share, which is $0.04 better than Wall Street's forecast.
08:30 am : S&P futures vs fair value: -7.0. Nasdaq futures vs fair value: -5.2. Futures give up some of their Wells Fargo (WFC) induced recovery on a hotter-than-expected inflation reading. June CPI rose 1.1% month-over-month, higher than the expected increase of 0.7%. Core CPI, which excludes food and energy, rose 0.3%, also higher than the consensus estimate of 0.2%. CPI is now up 5.0% year-over-year (consensus +4.5%) and core CPI is up 2.4%(consensus +2.3%).
08:15 am : S&P futures vs fair value: +0.8. Nasdaq futures vs fair value: +8.0. Futures rebound, and now suggest a positive start to the trading day after Wells Fargo (WFC) reports better-than-expected earnings and raises its divided by 10%. Shares of Wells Fargo are up nearly 13% in premarket trading.
08:00 am : S&P futures vs fair value: -6.8. Nasdaq futures vs fair value: -10.8. Futures indicate a lower open as negative sentiment carries over from yesterday's late-session decline. Intel (INTC) reported earnings of $0.28 per share, topping estimates by $0.03. In other earnings news, Abbott Laboratories (ABT) topped expectations, while CSX Corp (CSX) reported in-line results. On the economic front, the market will be digesting the latest CPI and industrial production readings. Fed Chairman Bernanke is giving his semiannual testimony before the House Financial Services Committee at 10:00 ET, and the FOMC meeting minutes from the June 25 meeting are set for release at 2:00 ET.
06:20 am : S&P futures vs fair value: -5.4. Nasdaq futures vs fair value: -10.3.
06:19 am : FTSE...5122.10...-49.80...-1.0%. DAX...6045.41...-36.29...-0.6%.
06:19 am : Nikkei...12760.80...+6.24...+0.1%. Hang Seng...21223.50...+48.73...+0.2%.
My posting is for my own entertainment, do your own DD before pushing your buy/call button
http://biz.yahoo.com/mu/update.html
4:25 pm : On Wednesday, the financial sector soared the most in its 19-year history after Wells Fargo (WFC 27.14, +6.63) reported better-than-expected earnings, sparking a rally that was compounded by short-covering. As a result, the stock market posted a large 2.5% gain, as a steep drop in crude prices helped overshadow a disappointingly high inflation reading.
Wells Fargo reported second quarter earnings of $0.53 per share, topping Wall Street's expectation by $0.03. In addition, the San Francisco-based bank raised its dividend by 10%, indicating it is in a solid financial position despite the current environment. The stock spiked 32% on the news.
This, along with better-than-expected earnings from Charles Schwab (SCHW 21.91, +2.69), Northern Trust (NTRS 76.00, +8.81) and Marshall & Ilsley (13.61, +2.02) sent the financial sector soaring to a 12.3% gain -- the largest advance since it was created in 1989.
It was a solid session outside of financials as well, with eight of the ten economic sectors posting an advance, aided by the second straight day of tumbling oil prices, bargain hunting and short-covering.
With regard to crude oil, prices fell 3.1% after a government report showed an unexpected crude and gasoline inventory build, sparking a rally in energy-price sensitive areas.
The consumer discretionary sector jumped 4.4%. General Motors (GM 11.46, +1.62) and Ford (F 5.49, +0.84) posted their largest one-day gain in years as investors scooped up the beaten down names. Meanwhile, retailers spiked 5.5% as oil prices eased.
Airlines surged 18% thanks to the drop in crude prices and better-than-expected earnings from American Airline parent AMR Corp (AMR 5.74, +1.33) and Delta Airlines (DAL 6.03, +1.36).
Other beaten down areas saw a surge in buying interest; the homebuilder group spiked 14% and the building product group rose 11%.
The tech sector performed roughly in-line with the market, unable to outperform despite Intel (INTC 20.91, +0.20) reporting earnings that topped estimates. The semiconductor-giant's margins were on the low side of previous guidance, which kept buying interest in check.
The energy sector was a laggard after the drop in crude prices took a toll on oil producers (-3.0%). The defensive-oriented utility sector slipped 1.9%.
On the economic front, June inflation rose by a higher-than-expected amount due to rising energy and food costs. Core inflation also was higher than expectations due to larger increases in the indexes for shelter, tobacco and smoking products, and the apparel index. Specifically, June CPI rose 1.1% month-over-month, higher than the expected increase of 0.7%. Core CPI, which excludes food and energy, rose 0.3%, which is also higher than the consensus estimate of 0.2%. CPI is now up 5.0% year-over-year (highest since 1991) and core CPI is up 2.4%.
Industrial production rebounded to a 0.5% gain in June from the decline of 0.2% in May. The gain is in part due to a 5.4% increase in the output of motor vehicles and parts as activity resumed at plants that had been idled during the American Axle strike. Separately, capacity utilization increased to 79.9% from 79.6%.
Fed Chairman Bernanke gave his semiannual testimony before the House Financial Services Committee. Much of his testimony was a rehash of his appearance before the Senate yesterday. Of note, the chairman said the GSEs (Fannie Mae (FNM 9.22, +2.15) and Freddie Mac (FRE 6.91, +1.65)) are adequately capitalized and in no danger of failing. He went on to say that action by Congress is justifiable in order to raise confidence in the GSEs.
The FOMC meeting minutes from the June 24-25 meeting were also released this session. The minutes did not provide the market with any new information, and as a result had a limited impact on trade.DJ30 +276.74 NASDAQ +69.14 NQ100 +2.5% R2K +3.7% SP400 +2.4% SP500 +30.45 NASDAQ Adv/Vol/Dec 2218/2.44 bln/670 NYSE Adv/Vol/Dec 2430/1.73 bln/759
3:30 pm : The major indices are trading at or near session highs as we go into the final half-hour of trade. The financial sector is up 10%, accounting for 15.2 points of the S&P 500's advance.
Within the S&P 500, 75% of stocks are trading higher. Most of the stocks that are posting a loss are in the energy (-2.4%) or utilities (-2.4%) sectors.DJ30 +224.23 NASDAQ +63.62 SP500 +23.97 NASDAQ Adv/Vol/Dec 2137/2.00 bln/719 NYSE Adv/Vol/Dec 2314/1.25 bln/853
3:00 pm : The financial sector continues to rally, hitting a gain of 9.3% -- the largest since the creation of the sector in 1989. By percent gain, the largest advancers are Wells Fargo (WFC 26.58, +6.08) up 29%, MGIC (MTG 4.64, +0.94) up 25%, and First Horizon (FHN 7.24, +1.35) up 23%. Despite this session's surge, the sector is down 35% this year, and is down 49% from its 52-week high -- which was reached exactly one-year ago.
The major indices climb to new highs, with the Dow and S&P 500 nearing a gain of 2%.DJ30 +207.92 NASDAQ +59.73 SP500 +21.77 NASDAQ Adv/Vol/Dec 2099/1.82 bln/737 NYSE Adv/Vol/Dec 2262/1.14 bln/901
2:35 pm : Stocks climb to session highs with financials (+8.2%) posting their largest gain since the Bear Stearns bailout. Only two of the sector's 89 components are trading lower -- Genworth Financial (GNW 14.37, -0.56) and Loews Corp (L 43.35, -0.42).
Beaten down automakers Ford (F 5.34, +0.69) and General Motors (GM 11.20, +1.36) are catching a bid. General Motors announced yesterday morning a new restrucutring plan to shore up capital through 2009. GM is up 14% this session, marking the largest one-day percent gain since surging 18% in 2005 on a better-than-expected earnings report and word that Tracinda Corp had increased its stake in the automaker.DJ30 +185.63 NASDAQ +54.41 SP500 +19.23 NASDAQ Adv/Vol/Dec 2055/1.68 bln/752 NYSE Adv/Vol/Dec 2236/1.05 bln/922
2:05 pm : The stock market trades with a solid gain as a strong advance within financial (+7.4%) and consumer discretionary (+3.1%) stocks more than offsets weakness in energy (-2.6%) and utilities (-2.1%) stocks. There was some choppy action as the minutes from the June 25 FOMC meeting were released, but stocks have managed to hold their gains.
The FOMC meetings showed that some Fed officials favored a rate rise very soon, fearing an "upward drift in long-run inflation expectations." Rates were left unchanged at the last Fed meeting, although there was a dissention that called for a rate increase.
Retailers are up 4.5%, with the drop in crude prices sparking buying interest. Activist investor William Ackman added to his $2 billion investment in Target (TGT 45.29, +1.63) after the company's stock declined 38% over the past year, according to Bloomberg.com's sources.DJ30 +155.28 NASDAQ +45.58 SP500 +15.24 NASDAQ Adv/Vol/Dec 1995/1.52 bln/791 NYSE Adv/Vol/Dec 2142/958 mln/997
1:30 pm : All three of the major indices have climbed to a fresh session high. The Nasdaq continues to outpace its counterparts, the S&P 500 and the Dow Jones Industrial Average, up 2.3% at its most recent level.
The energy sector (-2.2%) remains an underperformer for the second straight session, following oil prices lower. Its drop during recent sessions has reversed its year-to-date gain. Now, all ten of the major economic sectors are trading with a year-to-date loss.
Oil and gas explorers have been the energy sector's worst performing industry group this session; it is down 3.1%. Refiners, up 0.8%, are the only industry group in the sector to trade with a gain.DJ30 +179.45 NASDAQ +49.60 SP500 +17.08 NASDAQ Adv/Vol/Dec 2031/1.38 bln/750 NYSE Adv/Vol/Dec 2153/866 mln/991
1:00 pm : The stock market is trading at session highs, despite crude oil paring some of its losses. Oil prices are currently down 2.7% to $134.92, but were down as much as 4.9% in earlier trade.
The Nasdaq is outperforming, in part thanks to strength in Charles Schwab (SCHW 21.09, +1.87) and Research In Motion (RIMM 108.34, +2.49). Advancers outpace decliners by 5-to-2 on the Nasdaq.DJ30 +146.31 NASDAQ +40.90 SP500 +13.57 NASDAQ Adv/Vol/Dec 1957/1.23 bln/788 NYSE Adv/Vol/Dec 2072/781 mln/1040
12:30 pm : Stocks are back on the rise with financials (+6.1%) leading the charge higher. Small-cap names are outperforming, as the Russell 2000 Index advances 1.9%, compared to the S&P 500's advance of roughly 1%.
European markets closed mixed, with the FTSE falling 0.4%, while the DAX and CAC advanced 1.2% and 1.3%, respectively.DJ30 +134.52 NASDAQ +35.42 SP500 +12.65 NASDAQ Adv/Vol/Dec 1926/1.12 bln/795 NYSE Adv/Vol/Dec 2051/716 mln/1064
12:05 pm : The stock market is off its best levels, but is still sporting solid gains midday as a plummet in crude prices and a rebound in financials offset a disappointingly high inflation reading.
The market opened on a modestly higher note after Wells Fargo (WFC 25.31, +4.81) reported second quarter results that were solid when considering the current economic environment. The San Francisco-based bank reported earnings and revenue that topped expectations and also raised its dividend by 10%, sending shares 23% higher.
Other financial names reported earnings that were ahead of expectations, including Charles Schwab (SCHW 20.76, +1.54), Northern Trust (NTRS 73.02, +5.83), and Marshall & Ilsley (MI 12.55, +0.96).
As a result, the financial sector is surging 5.3%, with the diversified banks group climbing 15% -- the most since the group was formed in 1989.
After some early morning choppiness, the stock market rallied to its session high as crude prices plunged in response to a government report that showed an unexpected drop in crude oil and gasoline inventories. Crude prices are down 3.1% to $134.41, marking a two-day decline of more than 7%.
Five of the ten economic sectors are posting a gain, with strength in energy-cost sensitive areas such as consumer discretionary (+2.3%), with retailers soaring 3.0%. Airlines (+11.0%) are rallying, getting an additional boost after AMR Corp (AMR 5.26, +0.85) reported a quarterly loss that was smaller than expected.
Conversely, the energy sector is tumbling 2.3% with oil and gas exploration stocks down 3.0%.
Overall, earnings reports came out ahead of expectations, although the market's reaction has been mixed. Abbott (ABT 56.63, -1.22), Intel (INTC 20.87, +0.16) and Seagate Tech (STX 14.56, -2.74) topped estimates. Rail operator CSX Corp (CSX 61.07, +3.19) reported an in-line result.
On the economic front, June inflation rose by a higher than expected amount due to rising energy and food costs. Core inflation also was higher expectations due to larger increases in the indexes for shelter, tobacco and smoking products and the apparel index. Specifically, June CPI rose 1.1% month-over-month, higher than the expected increase of 0.7%. Core CPI, which excludes food and energy, rose 0.3%, also higher than the consensus estimate of 0.2%. CPI is now up 5.0% year-over-year (highest since 1991) and core CPI is up 2.4%.
Industrial production rebounded to 0.5% gain in June from the decline of 0.2% in May. The gain is in part due to a 5.4% increase in the output of motor vehicles and parts as activity resumed at plants that had idled during the American Axle Strike. Separately, capacity utilization increased to 79.9% from 79.6%.DJ30 +88.01 NASDAQ +28.32 SP500 +7.62 NASDAQ Adv/Vol/Dec 1880/1.02 bln/815 NYSE Adv/Vol/Dec 1986/652 mln/1115
11:30 am : The major indices run into some broad-based resistance at session highs, although the market continues to sport a solid gain. Fed Chairman Bernanke is currently answering questions from Housing Financial Services Committee members.
Of note, the chairman said the GSEs (Fannie Mae (FNM 7.91, +0.84) and Freddie Mac (FRE 5.93, +0.67)) are adequately capitalized and in no danger of failing. He went on to say that action by Congress is justifiable in order to raise confidence.
Treasures are under selling pressure on the long end of the curve. The 10-year note is down 25 ticks, and the 30-year bond is down nearly two points. The weakness in bonds is due to the stock market's recent advance and the higher-than-expected inflation reading.DJ30 +97.37 NASDAQ +28.27 SP500 +8.25 NASDAQ Adv/Vol/Dec 1816/689 mln/771 NYSE Adv/Vol/Dec 1954/465 mln/1102
11:00 am : Crude prices plummet 4.0% to $133.32 per barrel on news of the unexpected increase in crude and gasoline inventories. Crude prices are now down more than 8% over the last two days.
The news has lifted the stock market to session highs, with financials (+5.8%) and retail (+2.7%) stocks seeing the most buying interest. Conversely, the energy sector (-3.2%) quickly dropped to session lows on the spike in crude.
AMR Corp (AMR 5.37, +0.96), parent company of American Airlines, reported a second quarter loss of $284 million after fuel prices increased costs by $838 million compared to the prior year. The results, however, topped Wall Street expectations, helping to lift shares by 22%.
The better-than-expected earnings from AMR and the plummet in crude prices is lifting the Amex Airline Index to a massive 12% gain. Despite the advance, airlines are still posting a steep 55% drop this year.DJ30 +97.54 NASDAQ +28.31 SP500 +9.43 NASDAQ Adv/Vol/Dec 1632/538 mln/878 NYSE Adv/Vol/Dec 1858/362 mln/1159
10:35 am : Just hitting the wires, crude inventories for the week ended July 11 rose 2.95 million barrels, compared to the expected draw of 2.2 million. Crude prices were trading down 0.9% to $137.44 just prior to the release.
After slipping off its session high, the stock market goes back on the rise on the unexpected build in crude stockpiles.
In merger and acquisition news, Cleveland-Cliffs (CLF 103.20, -8.26), North America's largest iron-ore pellet producer agreed to buy Appalachian coal producer Alpha Natural Resources (ANR 110.76, +15.84). The price of $10 billion in stock and cash represents a 35% premium to Tuesday's closing price. The deal will enable Cliffs to diversify its mineral production and achieve greater size and scale needed to compete on a global scale for raw materials.
The materials sector is the worst performing area this session, with a loss of 1.7%.DJ30 +56.34 NASDAQ +13.12 SP500 +7.21 NASDAQ Adv/Vol/Dec 1441/395 mln/980 NYSE Adv/Vol/Dec 1470/264 mln/1465
10:05 am : The stock market briefly slips into the red, and then bounces back to hit session highs. Most of the buying interest is concentrated within financials (+4.5%), as no other sector is up more than 1%.
Wells Fargo's (WFC 25.22, +4.71) better-than-expected earnings are acting as the main buying catalyst, although the sector is also benefiting from earnings beats from the likes of Charles Schwab (SCHW 20.83, +1.61), Northern Trust (NTRS 71.74, +4.55), Marshall & Ilsley (MI 12.39, +0.80).
The diversified banks group is surging 14.0%, its largest advance in its nearly 20 year history.
Fed Chairman Bernanke will shortly testify before the House Financial Services Committee. His prepared speech will likely be very similar to his testimony before the Senate yesterday, although the question and answer session could reveal new information.DJ30 +63.91 NASDAQ +15.01 SP500 +7.45 NASDAQ Adv/Vol/Dec 1460/240 mln/865 NYSE Adv/Vol/Dec 1554/170 mln/1323
09:45 am : The stock market gets off to a slightly higher start as better-than-expected earnings news helps to offset some disappointing inflation data.
On the earnings front, Intel (INTC 20.65, -0.06), Abbott Labs (ABT 57.44, -0.35), Charles Schwab (SCHW 20.10, +0.88) and Marshall & Ilsley (MI 12.03, +0.44) reported earnings that topped expectations. The big mover is Wells Fargo (WFC 23.64, +3.11) -- the stock is up about 15% after the company reported earnings that topped expectations and raised its dividend by 10%.
June CPI rose by a larger than expected amount, which is partially offsetting the better-than-expected earnings. High energy and food prices spurred a 1.1% month-over-month jump in CPI, which was higher than the expected increase of 0.7%. Core CPI rose 0.3%, topping the expected rise of 0.2%. Total CPI is up 5.0% year-over-year, the largest increase since 1991.
Crude prices are trading down 0.8% to $137.63 per barrel after the more than 4% drop yesterday. The government will release its weekly energy inventory statistics at 10:35 ET.DJ30 -13.60 NASDAQ +2.71 SP500 +0.98
09:17 am : S&P futures vs fair value: -1.0. Nasdaq futures vs fair value: +1.0. Futures indicate a flat start to the trading day. Just hitting the wires, industrial production in June rose 0.5%, topping the expected 0.1% increase. Capacity utilization rose to 79.9%, while economists expected utilization to hold steady at 79.4%.
09:00 am : S&P futures vs fair value: -2.5. Nasdaq futures vs fair value: -6.2. Futures indicate a negative start, although they are well off their lowest levels. Charles Schwab (SCHW) reported second quarter earnings from continuing operations of $0.27 per share, which is $0.01 better than expectations. Milwaukee-based bank Marshal & Isley (MI) reported a second quarter loss of $1.52 per share, which is $0.04 better than Wall Street's forecast.
08:30 am : S&P futures vs fair value: -7.0. Nasdaq futures vs fair value: -5.2. Futures give up some of their Wells Fargo (WFC) induced recovery on a hotter-than-expected inflation reading. June CPI rose 1.1% month-over-month, higher than the expected increase of 0.7%. Core CPI, which excludes food and energy, rose 0.3%, also higher than the consensus estimate of 0.2%. CPI is now up 5.0% year-over-year (consensus +4.5%) and core CPI is up 2.4%(consensus +2.3%).
08:15 am : S&P futures vs fair value: +0.8. Nasdaq futures vs fair value: +8.0. Futures rebound, and now suggest a positive start to the trading day after Wells Fargo (WFC) reports better-than-expected earnings and raises its divided by 10%. Shares of Wells Fargo are up nearly 13% in premarket trading.
08:00 am : S&P futures vs fair value: -6.8. Nasdaq futures vs fair value: -10.8. Futures indicate a lower open as negative sentiment carries over from yesterday's late-session decline. Intel (INTC) reported earnings of $0.28 per share, topping estimates by $0.03. In other earnings news, Abbott Laboratories (ABT) topped expectations, while CSX Corp (CSX) reported in-line results. On the economic front, the market will be digesting the latest CPI and industrial production readings. Fed Chairman Bernanke is giving his semiannual testimony before the House Financial Services Committee at 10:00 ET, and the FOMC meeting minutes from the June 25 meeting are set for release at 2:00 ET.
06:20 am : S&P futures vs fair value: -5.4. Nasdaq futures vs fair value: -10.3.
06:19 am : FTSE...5122.10...-49.80...-1.0%. DAX...6045.41...-36.29...-0.6%.
06:19 am : Nikkei...12760.80...+6.24...+0.1%. Hang Seng...21223.50...+48.73...+0.2%.
My posting is for my own entertainment, do your own DD before pushing your buy/call button
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