AI
Thursday, August 07, 2008 8:01:29 PM
Market Update 080807
http://biz.yahoo.com/mu/update.html
4:35 pm : New unemployment benefit claims climbed to a six year high, AIG posted its third consecutive quarterly loss, crude oil prices rose and retailers reported disappointing July same-store sales. In turn, the stock market posted a steep loss on Thursday, with all ten sectors ending the day in negative territory.
The financial sector (-5.0%) was the driving force behind the session's weakness, as AIG (AIG 23.84, -5.25) tumbled 18% -- its largest one-day percent decline. AIG lost $5.4 billion in the second quarter, as the insurance giant continues to get battered by the credit market turmoil. On an adjusted basis, AIG lost $0.51 per share, which fell well short of the expected profit of $0.63 per share.
Citigroup (C 18.47, -1.23) took financials to session lows after the company agreed to settle allegations from the New York Attorney General that Citi misled investors by marketing auction rate securities (ARS) as safe, cash-like investments, when they were actually facing increasing liquidity risks. Under the deal, Citi will buy back more than $7 billion in illiquid ARS from all Citi retail customers, charities, and small- to mid-sized businesses. Citi will also reimburse all retail investors that sold ARS at a discount after the market failed, and will pay $100 million in fines.
Citi said the capital impact of bringing the assets onto its balance sheet is expected to have a minimal impact, although investors did not take solace in the news. Presumably, Citi's action foreshadows settlements from other firms that have also been alleged of wrongdoing in their marketing of ARS.
Separately, the S&P 500 Retailing Index fell 2.1%, after 21 of 31 retailers reported July same-store sales that fell short of the Briefing.com consensus -- including two of the most influential names.
Wal-Mart (WMT 56.96, -3.80) reported a 3.0% increase in July same-store sales, although shares still fell as the retailing giant was expected to post 3.3% growth. Wal-Mart also gave a conservative outlook, as it typically does.
Shares of Target (TGT 45.76, -2.25) fell after the company reported a 1.3% decline in July same-store sales, compared to the expected drop of 0.2%.
The tech sector (-0.1%) outperformed on a relative basis. There was notable strength in semiconductor stocks (+2.3%). Intel (INTC 23.67, +0.87) rose 3.8% after Citigroup said field checks in Japan suggest strength in Intel's Atom chip.
In economic news, the number of new jobless claims rose to the highest level in six years, which compounded concerns about the current state of the U.S. labor market. For the week ended Aug. 2, initial jobless claims rose 1.6% to 455,000, compared to the expected reading of 420,000 claims.
The National Association of Realtors said June pending home sales rose 5.3% month-over-month, topping the expected decline of 1.0%. Although this report has been volatile in the past, it is nonetheless a hopeful sign for the depressed housing market. The report briefly gave the stock market some modest support, but the data was soon ignored as the financial sector extended its losses.
Treasuries rallied, lifted by the jobless claims data and a stronger-than-expected showing during the latest Treasury auction. The 10-year note rose more than a full point, sending its yield down to 3.92% from 4.05%.
In commodity trading, crude prices rose 1.2% to $119.96 per barrel, snapping a three day plunge of 5%. The end result is not as bad as it seems, as prices retreated from a gain of 2.7%.
The Dow tumbled 1.9%, the Nasdaq slipped 1.0% and the S&P 500 fell 1.8%. However, the major indices are still on pace to end the week with a gain, thanks to strong advances in previous sessions. Week-to-date, the Dow, Nasdaq and S&P 500 are up 0.9%, 1.9%, and 0.5%, respectively.DJ30 -224.56 NASDAQ -22.64 NQ100 -0.8% R2K -1.7% SP400 -1.5% SP500 -23.12 NASDAQ Adv/Vol/Dec 951/2.27 bln/1846 NYSE Adv/Vol/Dec 742/1.28 bln/2388
3:30 pm : The major indices are just above their session lows in what has generally been a pessimistic day of trade; the S&P 500 sported a loss of 0.2% at its best level of the session and is now down 1.4%.
Financials remain a drag on the session's overall performance. Though it is the second largest economic sector, its 5.2% decline is too much for the technology sector's 0.2% advance. Tech is the largest economic sector.
Eight of the ten sectors are trading with a loss.DJ30 -167.89 NASDAQ -13.56 SP500 -17.93 NASDAQ Adv/Vol/Dec 1028/1.78 bln/1748 NYSE Adv/Vol/Dec 840/929 mln/2277
3:00 pm : A fresh wave of selling pressure sends the stock market near its sesion lows. The financial sector is the main drag, trading with a loss of 4.3%.
By percent change, the worst performing financials are AIG (AIG 24.15, -4.94), down 17%, Fannie Mae (FNM 10.07, -1.53), down 13%, and Lehman Brothers (LEH18.39, -1.90), down 9.4%. Financials have fallen 1.4% this week; this session's decline is being offset by a strong 5% advance on Tuesday.DJ30 -150.30 NASDAQ -10.35 SP500 -14.95 NASDAQ Adv/Vol/Dec 1075/821 mln/1675 NYSE Adv/Vol/Dec 940/821 mln/2163
2:45 pm : Oil prices recover from negative territory to a 1.2% gain, causing stocks to go on the defensive. The Nasdaq joins the S&P 500 and Dow in negative territory.DJ30 -125.63 NASDAQ -5.63 SP500 -11.91 NASDAQ Adv/Vol/Dec 1113/1.48 bln/1627 NYSE Adv/Vol/Dec 961/780 mln/2114
2:00 pm : The major indices continue to trade in mixed fashion with the Nasdaq outperforming its counterparts.
The technology sector (+0.8%) has been a driving force behind the relative strength today, yet that has also been the case throughout the week. At current prices, the S&P technology sector is up 4.6% for the week. The Nasdaq Composite is up 3.0% for the week versus gains for the Dow and S&P of 2.1% and 1.6%, respectively.
Separately, the homebuilding group (+0.6%) is also outperforming the broader market today. A better-than-expected pending home sales report and a big move in the Treasury market where the yield on the mortgage benchmark 10-year note has dropped 10 basis points to 3.95% have been supportive factors in the advance.DJ30 -106.50 NASDAQ +0.11 SP500 -9.87 NASDAQ Adv/Vol/Dec 1238/1.23 bln/1534 NYSE Adv/Vol/Dec 1004/654 mln/1970
1:30 pm : The recovery effort fades as continued weakness in financials (-3.2%), consumer staples (-1.3%) and telecom (-1.6%) offset advances made by utilities (+1.0%) and tech (+1.0%). The Nasdaq holds a slight gain, while the S&P and Dow trade with losses.
The Treasury market is rallying, with the 10-year note up 30 ticks, sending its yield down to 3.94%. The buying interest is fueled by a well received Treasury auction.DJ30 -90.62 NASDAQ +5.73 SP500 -8.40 NASDAQ Adv/Vol/Dec 1179/1.17 bln/1535 NYSE Adv/Vol/Dec 1026/634 mln/2016
1:00 pm : The major indices climb to their best levels of the session as crude prices (-0.3% at $118.22) fall to their lowest levels of the session. The Nasdaq Composite is posting a slight gain, while the Dow and S&P 500 pare a good portion of their losses.
Tech stocks (+1.0%) are leading the charge higher. Intel (INTC 24.02, +1.22) is up 5.4%. Citigroup noted that field checks in Japan suggest that strength in Intel's Atom chip makes Intel's third quarter revenue growth guidance of 8.8% more achievable. Citi noted that Intel is still prone to macro factors. Semiconductors stocks as whole are up 4.2% this session.DJ30 -70.20 NASDAQ +7.23 SP500 -7.18 NASDAQ Adv/Vol/Dec 1208/1.04 bln/1469 NYSE Adv/Vol/Dec 1063/573 mln/1976
12:30 pm : The major indices continue to fluctuate in negative territory. Market breadth is bearish, with decliners outpacing advancers by 9-to-4 on the NYSE and by 8-to-5 on the Nasdaq.
The tech (+0.6%) and utilities (+0.6%) sector climb to session highs, while financials (-3.3%) remain under pressure.DJ30 -119.03 NASDAQ -3.09 SP500 -11.39 NASDAQ Adv/Vol/Dec 1016/909 mln/1647 NYSE Adv/Vol/Dec 925/505 mln/2086
12:05 pm : The stock market is posting a substantial loss at midday, with an increase in oil prices, disappointing employment data, disappointing same-store sales and a massive loss at AIG acting as the main selling catalysts. The market did recover from its opening lows, however, as a better-than-expected housing report helped limit some selling interest.
In economic news, the number of new jobless claims rose to the highest level in six years, which increased concerns about the labor market. For the week ended Aug. 2, initial jobless claims rose 1.6% to 455,000, compared to the expected reading of 420,000 claims.
The National Association of Realtors said June pending home sales rose 5.3% month-over-month, topping the expected decline of 1.0%. Although this report has been volatile in the past, it is nonetheless a hopeful sign for the depressed housing market.
In earnings news, AIG (AIG 24.03, -5.06) reported a massive loss of $5.4 billion, marking its third consecutive quarter of negative earnings as the insurance giant continues to get impacted by the credit market turmoil. On an adjusted basis, AIG lost $0.51 per share, which fell well short of the expected profit of $0.63 per share. The result includes a pretax charge of roughly $5.6 billion for a net unrealized market valuation loss related to AIG Financial Products super senior credit default swap portfolio. Shares of AIG are down 17%, marking a larger decline than its 16% drop on Black Monday.
The financial sector (-3.3%) is the main laggard. Citigroup (C 18.97, -0.73) is also acting as a drag after the company agreed to buy back billions in illiquid auction rate securities in an agreement with the New York Attorney General. The attorney general alleged that Citi misled investors by marketing auction rate securities as safe, cash-like investments, when they were actually facing increasing liquidity risks.
The tech sector (+0.3%) is a pocket of strength, with leadership in semiconductor stocks (+2.7%). As a result, the Nasdaq Composite is outperforming on a relative basis.
The S&P 500 Retailing Index is posting a loss of 1.5%, as investors show disappointment with July same-store sales reports.
Wal-Mart (WMT 58.18, -2.58) reported a 3.0% increase in July same-store sales, although shares are still coming under pressure as the retailing giant was expected to post 3.3% growth. Wal-Mart also gave a conservative outlook, as it typically does.
Target (TGT 46.19, -1.82) is under selling pressure after reporting a 1.2% drop in July same-store sales, compared to the expected drop of 0.2%.
Meanwhile, crude prices are up 1.1% to $119.87 per barrel, but have eased off session highs when they were up 2.7%. DJ30 -140.53 NASDAQ -7.47 SP500 -12.76 NASDAQ Adv/Vol/Dec 1013/831 mln/1625 NYSE Adv/Vol/Dec 905/459 mln/2080
11:30 am : The financial sector (-2.8%) falls to session lows, sending the broader market on the decline.
Citigroup (C 18.91, -0.79) and the NY Attorney General have reached a multi-billion dollar agreement over allegations that Citi misled investors. The NY Attorney General said that Citigroup marketed auction rate securities as safe and cash-like investments, when in fact they had increasing liquidity risk.
Citi agreed to buy back all illiquid auction rate securities from Citi retail customers, charities and small to mid-sized businesses. The securities are worth more than $7 billion. Citi must also reimburse all retail investors who sold their auction rate securities at a discount.DJ30 -119.44 NASDAQ -7.97 SP500 -11.31 NASDAQ Adv/Vol/Dec 959/714 mln/1644 NYSE Adv/Vol/Dec 865/401 mln/2081
11:00 am : The energy sector (+0.5%) bounces into positive territory in conjunction with a rise in crude prices (+1.8% at $120.68). At the same time, the broader market dips a bit, but is still trading well above session lows.
Within the energy sector, 79% of stocks are trading higher, led by the oil and gas exploration (+1.5%) and oil and gas drilling groups (+1.2%).DJ30 -102.75 NASDAQ -6.55 SP500 -9.31 NASDAQ Adv/Vol/Dec 935/564 mln/1568 NYSE Adv/Vol/Dec 845/323 mln/2039
10:30 am : The major indices make a broad-based recovery effort, thanks to the better-than-expected pending home sales reading. Oil prices (+0.9% at $119.61) retreat from their session high when they were up 2.7%, which is also helping the stock market to pare its losses.
The tech sector recovers to positive territory, although its gain is only a slight 0.1%. Semiconductor stocks (+1.6%) are providing leadership, with Intel (INTC 23.32, +0.52) up 2.3%.DJ30 -89.72 NASDAQ -6.98 SP500 -8.50 NASDAQ Adv/Vol/Dec 916/411 mln/1535 NYSE Adv/Vol/Dec 789/239 mln/2031
10:05 am : The decline is halted as selling pressure eases after a better-than-expected home sales report hits the wires, although the major indices still trade with substantial losses.
June pending home sales rose 5.3%, which is better than the expected decline of 1.0%.
All ten of the sectors are in negative territory, led by a 1.8% drop in financials as AIG (AIG 24.59, -4.50) plunges 16%. The energy (-0.1%) and tech (-0.1%) sectors are outperforming on a relative basis
The tech-heavy Nasdaq is outperforming, as it did yesterday, with a loss of 0.5% compared to the S&P 500's decline of 0.8%.DJ30 -122.94 NASDAQ -11.48 SP500 -9.96 NASDAQ Adv/Vol/Dec 748/217 mln/1579 NYSE Adv/Vol/Dec 636/141 mln/2084
09:40 am : There is not much positive news this morning -- two Dow components reported disappointing results, oil prices are rising and the number of new unemployment claims unexpectedly increased. As a result, the stock market gets off to a sharply lower start.
AIG (AIG 24.97, -4.12) reported a massive loss of $5.4 billion, marking its third consecutive quarter of negative earnings. On an adjusted basis, AIG lost $0.51 per share, which fell well short of the expected profit of $0.63 per share. The result includes a pretax charge of roughly $5.6 billion for a net unrealized market valuation loss related to AIG Financial Products super senior credit default swap portfolio.
Wal-Mart (WMT 58.18, -2.58) reported a 3.0% increase in July same-store sales, although shares are still coming under pressure as the retailing giant was expected to post 3.3% growth.
In economic news, an increase in the number of weekly initial jobless claims raised concerns about the labor market. For the week ended Aug. 2, new jobless claims rose 1.6% to 455,000, compared to the expected reading of 420,000 claims.
Meanwhile, oil prices are up 1.8% to $120.75 per barrel, after declining around 5% during the previous three sessions.DJ30 -150.79 NASDAQ -20.55 SP500 -14.15
09:15 am : S&P futures vs fair value: -11.3. Nasdaq futures vs fair value: -15.1.
09:00 am : S&P futures vs fair value: -11.7. Nasdaq futures vs fair value: -15.0. Futures continue to indicate a lower start as the latest jobless claims reading raises concerns about the labor market. The NY Post reports that Lehman Brothers (LEH) CEO Dick Fuld is in "scramble mode" to try and raise capital to ensure the company does not get split up. LEH is down 3% in premarket trading. Treasuries are seeing some buying interest, with the 10-year note up 19 ticks, sending its yield down to 3.99%.
08:30 am : S&P futures vs fair value: -11.0. Nasdaq futures vs fair value: -14.0. Stock market futures extend their losses on a worse-than-expected unemployment claims reading. Initial jobless claims for the week ended Aug. 2 rose 1.6% to 455,000. Economists expected 420,000 claims. Target (TGT) reports a 1.2% drop in July same-store sales, which is worse than the expected drop of 0.2%.
08:16 am : S&P futures vs fair value: -11.3. Nasdaq futures vs fair value: -15.2.
08:00 am : S&P futures vs fair value: -7.5. Nasdaq futures vs fair value: -10.2. Futures suggest a lower open after disappointing results from two Dow components. AIG (AIG) reported a second quarter loss of $0.51 per share, ex-items, which is $1.14 worse than the consensus estimate, sending shares of AIG tumbling 11% in premarket trading. Shares of Wal-Mart (WMT) are down 3.4% in premarket trading after the company reported July same-store sales rose 3%, which fell short of the Briefing.com consensus that called for 3.3% growth. Meanwhile, crude prices are up 1.7% to $120.60 per barrel, which follows a drop of more than 5% over the three previous sessions. As expected, the European Central Bank left its benchmark rate unchanged at 4.25%, and the Bank of England left its rate at 5.00%.
06:10 am : S&P futures vs fair value: -3.3. Nasdaq futures vs fair value: -3.0.
06:09 am : FTSE...5511.70...+25.60...+0.5%. DAX...6595.70...+34.31...+0.5%.
06:09 am : Nikkei...13124.99...-129.90...-1.0%. Hang Seng...22104.20...+154.45...+0.7%.
My posting is for my own entertainment, do your own DD before pushing your buy/call button
http://biz.yahoo.com/mu/update.html
4:35 pm : New unemployment benefit claims climbed to a six year high, AIG posted its third consecutive quarterly loss, crude oil prices rose and retailers reported disappointing July same-store sales. In turn, the stock market posted a steep loss on Thursday, with all ten sectors ending the day in negative territory.
The financial sector (-5.0%) was the driving force behind the session's weakness, as AIG (AIG 23.84, -5.25) tumbled 18% -- its largest one-day percent decline. AIG lost $5.4 billion in the second quarter, as the insurance giant continues to get battered by the credit market turmoil. On an adjusted basis, AIG lost $0.51 per share, which fell well short of the expected profit of $0.63 per share.
Citigroup (C 18.47, -1.23) took financials to session lows after the company agreed to settle allegations from the New York Attorney General that Citi misled investors by marketing auction rate securities (ARS) as safe, cash-like investments, when they were actually facing increasing liquidity risks. Under the deal, Citi will buy back more than $7 billion in illiquid ARS from all Citi retail customers, charities, and small- to mid-sized businesses. Citi will also reimburse all retail investors that sold ARS at a discount after the market failed, and will pay $100 million in fines.
Citi said the capital impact of bringing the assets onto its balance sheet is expected to have a minimal impact, although investors did not take solace in the news. Presumably, Citi's action foreshadows settlements from other firms that have also been alleged of wrongdoing in their marketing of ARS.
Separately, the S&P 500 Retailing Index fell 2.1%, after 21 of 31 retailers reported July same-store sales that fell short of the Briefing.com consensus -- including two of the most influential names.
Wal-Mart (WMT 56.96, -3.80) reported a 3.0% increase in July same-store sales, although shares still fell as the retailing giant was expected to post 3.3% growth. Wal-Mart also gave a conservative outlook, as it typically does.
Shares of Target (TGT 45.76, -2.25) fell after the company reported a 1.3% decline in July same-store sales, compared to the expected drop of 0.2%.
The tech sector (-0.1%) outperformed on a relative basis. There was notable strength in semiconductor stocks (+2.3%). Intel (INTC 23.67, +0.87) rose 3.8% after Citigroup said field checks in Japan suggest strength in Intel's Atom chip.
In economic news, the number of new jobless claims rose to the highest level in six years, which compounded concerns about the current state of the U.S. labor market. For the week ended Aug. 2, initial jobless claims rose 1.6% to 455,000, compared to the expected reading of 420,000 claims.
The National Association of Realtors said June pending home sales rose 5.3% month-over-month, topping the expected decline of 1.0%. Although this report has been volatile in the past, it is nonetheless a hopeful sign for the depressed housing market. The report briefly gave the stock market some modest support, but the data was soon ignored as the financial sector extended its losses.
Treasuries rallied, lifted by the jobless claims data and a stronger-than-expected showing during the latest Treasury auction. The 10-year note rose more than a full point, sending its yield down to 3.92% from 4.05%.
In commodity trading, crude prices rose 1.2% to $119.96 per barrel, snapping a three day plunge of 5%. The end result is not as bad as it seems, as prices retreated from a gain of 2.7%.
The Dow tumbled 1.9%, the Nasdaq slipped 1.0% and the S&P 500 fell 1.8%. However, the major indices are still on pace to end the week with a gain, thanks to strong advances in previous sessions. Week-to-date, the Dow, Nasdaq and S&P 500 are up 0.9%, 1.9%, and 0.5%, respectively.DJ30 -224.56 NASDAQ -22.64 NQ100 -0.8% R2K -1.7% SP400 -1.5% SP500 -23.12 NASDAQ Adv/Vol/Dec 951/2.27 bln/1846 NYSE Adv/Vol/Dec 742/1.28 bln/2388
3:30 pm : The major indices are just above their session lows in what has generally been a pessimistic day of trade; the S&P 500 sported a loss of 0.2% at its best level of the session and is now down 1.4%.
Financials remain a drag on the session's overall performance. Though it is the second largest economic sector, its 5.2% decline is too much for the technology sector's 0.2% advance. Tech is the largest economic sector.
Eight of the ten sectors are trading with a loss.DJ30 -167.89 NASDAQ -13.56 SP500 -17.93 NASDAQ Adv/Vol/Dec 1028/1.78 bln/1748 NYSE Adv/Vol/Dec 840/929 mln/2277
3:00 pm : A fresh wave of selling pressure sends the stock market near its sesion lows. The financial sector is the main drag, trading with a loss of 4.3%.
By percent change, the worst performing financials are AIG (AIG 24.15, -4.94), down 17%, Fannie Mae (FNM 10.07, -1.53), down 13%, and Lehman Brothers (LEH18.39, -1.90), down 9.4%. Financials have fallen 1.4% this week; this session's decline is being offset by a strong 5% advance on Tuesday.DJ30 -150.30 NASDAQ -10.35 SP500 -14.95 NASDAQ Adv/Vol/Dec 1075/821 mln/1675 NYSE Adv/Vol/Dec 940/821 mln/2163
2:45 pm : Oil prices recover from negative territory to a 1.2% gain, causing stocks to go on the defensive. The Nasdaq joins the S&P 500 and Dow in negative territory.DJ30 -125.63 NASDAQ -5.63 SP500 -11.91 NASDAQ Adv/Vol/Dec 1113/1.48 bln/1627 NYSE Adv/Vol/Dec 961/780 mln/2114
2:00 pm : The major indices continue to trade in mixed fashion with the Nasdaq outperforming its counterparts.
The technology sector (+0.8%) has been a driving force behind the relative strength today, yet that has also been the case throughout the week. At current prices, the S&P technology sector is up 4.6% for the week. The Nasdaq Composite is up 3.0% for the week versus gains for the Dow and S&P of 2.1% and 1.6%, respectively.
Separately, the homebuilding group (+0.6%) is also outperforming the broader market today. A better-than-expected pending home sales report and a big move in the Treasury market where the yield on the mortgage benchmark 10-year note has dropped 10 basis points to 3.95% have been supportive factors in the advance.DJ30 -106.50 NASDAQ +0.11 SP500 -9.87 NASDAQ Adv/Vol/Dec 1238/1.23 bln/1534 NYSE Adv/Vol/Dec 1004/654 mln/1970
1:30 pm : The recovery effort fades as continued weakness in financials (-3.2%), consumer staples (-1.3%) and telecom (-1.6%) offset advances made by utilities (+1.0%) and tech (+1.0%). The Nasdaq holds a slight gain, while the S&P and Dow trade with losses.
The Treasury market is rallying, with the 10-year note up 30 ticks, sending its yield down to 3.94%. The buying interest is fueled by a well received Treasury auction.DJ30 -90.62 NASDAQ +5.73 SP500 -8.40 NASDAQ Adv/Vol/Dec 1179/1.17 bln/1535 NYSE Adv/Vol/Dec 1026/634 mln/2016
1:00 pm : The major indices climb to their best levels of the session as crude prices (-0.3% at $118.22) fall to their lowest levels of the session. The Nasdaq Composite is posting a slight gain, while the Dow and S&P 500 pare a good portion of their losses.
Tech stocks (+1.0%) are leading the charge higher. Intel (INTC 24.02, +1.22) is up 5.4%. Citigroup noted that field checks in Japan suggest that strength in Intel's Atom chip makes Intel's third quarter revenue growth guidance of 8.8% more achievable. Citi noted that Intel is still prone to macro factors. Semiconductors stocks as whole are up 4.2% this session.DJ30 -70.20 NASDAQ +7.23 SP500 -7.18 NASDAQ Adv/Vol/Dec 1208/1.04 bln/1469 NYSE Adv/Vol/Dec 1063/573 mln/1976
12:30 pm : The major indices continue to fluctuate in negative territory. Market breadth is bearish, with decliners outpacing advancers by 9-to-4 on the NYSE and by 8-to-5 on the Nasdaq.
The tech (+0.6%) and utilities (+0.6%) sector climb to session highs, while financials (-3.3%) remain under pressure.DJ30 -119.03 NASDAQ -3.09 SP500 -11.39 NASDAQ Adv/Vol/Dec 1016/909 mln/1647 NYSE Adv/Vol/Dec 925/505 mln/2086
12:05 pm : The stock market is posting a substantial loss at midday, with an increase in oil prices, disappointing employment data, disappointing same-store sales and a massive loss at AIG acting as the main selling catalysts. The market did recover from its opening lows, however, as a better-than-expected housing report helped limit some selling interest.
In economic news, the number of new jobless claims rose to the highest level in six years, which increased concerns about the labor market. For the week ended Aug. 2, initial jobless claims rose 1.6% to 455,000, compared to the expected reading of 420,000 claims.
The National Association of Realtors said June pending home sales rose 5.3% month-over-month, topping the expected decline of 1.0%. Although this report has been volatile in the past, it is nonetheless a hopeful sign for the depressed housing market.
In earnings news, AIG (AIG 24.03, -5.06) reported a massive loss of $5.4 billion, marking its third consecutive quarter of negative earnings as the insurance giant continues to get impacted by the credit market turmoil. On an adjusted basis, AIG lost $0.51 per share, which fell well short of the expected profit of $0.63 per share. The result includes a pretax charge of roughly $5.6 billion for a net unrealized market valuation loss related to AIG Financial Products super senior credit default swap portfolio. Shares of AIG are down 17%, marking a larger decline than its 16% drop on Black Monday.
The financial sector (-3.3%) is the main laggard. Citigroup (C 18.97, -0.73) is also acting as a drag after the company agreed to buy back billions in illiquid auction rate securities in an agreement with the New York Attorney General. The attorney general alleged that Citi misled investors by marketing auction rate securities as safe, cash-like investments, when they were actually facing increasing liquidity risks.
The tech sector (+0.3%) is a pocket of strength, with leadership in semiconductor stocks (+2.7%). As a result, the Nasdaq Composite is outperforming on a relative basis.
The S&P 500 Retailing Index is posting a loss of 1.5%, as investors show disappointment with July same-store sales reports.
Wal-Mart (WMT 58.18, -2.58) reported a 3.0% increase in July same-store sales, although shares are still coming under pressure as the retailing giant was expected to post 3.3% growth. Wal-Mart also gave a conservative outlook, as it typically does.
Target (TGT 46.19, -1.82) is under selling pressure after reporting a 1.2% drop in July same-store sales, compared to the expected drop of 0.2%.
Meanwhile, crude prices are up 1.1% to $119.87 per barrel, but have eased off session highs when they were up 2.7%. DJ30 -140.53 NASDAQ -7.47 SP500 -12.76 NASDAQ Adv/Vol/Dec 1013/831 mln/1625 NYSE Adv/Vol/Dec 905/459 mln/2080
11:30 am : The financial sector (-2.8%) falls to session lows, sending the broader market on the decline.
Citigroup (C 18.91, -0.79) and the NY Attorney General have reached a multi-billion dollar agreement over allegations that Citi misled investors. The NY Attorney General said that Citigroup marketed auction rate securities as safe and cash-like investments, when in fact they had increasing liquidity risk.
Citi agreed to buy back all illiquid auction rate securities from Citi retail customers, charities and small to mid-sized businesses. The securities are worth more than $7 billion. Citi must also reimburse all retail investors who sold their auction rate securities at a discount.DJ30 -119.44 NASDAQ -7.97 SP500 -11.31 NASDAQ Adv/Vol/Dec 959/714 mln/1644 NYSE Adv/Vol/Dec 865/401 mln/2081
11:00 am : The energy sector (+0.5%) bounces into positive territory in conjunction with a rise in crude prices (+1.8% at $120.68). At the same time, the broader market dips a bit, but is still trading well above session lows.
Within the energy sector, 79% of stocks are trading higher, led by the oil and gas exploration (+1.5%) and oil and gas drilling groups (+1.2%).DJ30 -102.75 NASDAQ -6.55 SP500 -9.31 NASDAQ Adv/Vol/Dec 935/564 mln/1568 NYSE Adv/Vol/Dec 845/323 mln/2039
10:30 am : The major indices make a broad-based recovery effort, thanks to the better-than-expected pending home sales reading. Oil prices (+0.9% at $119.61) retreat from their session high when they were up 2.7%, which is also helping the stock market to pare its losses.
The tech sector recovers to positive territory, although its gain is only a slight 0.1%. Semiconductor stocks (+1.6%) are providing leadership, with Intel (INTC 23.32, +0.52) up 2.3%.DJ30 -89.72 NASDAQ -6.98 SP500 -8.50 NASDAQ Adv/Vol/Dec 916/411 mln/1535 NYSE Adv/Vol/Dec 789/239 mln/2031
10:05 am : The decline is halted as selling pressure eases after a better-than-expected home sales report hits the wires, although the major indices still trade with substantial losses.
June pending home sales rose 5.3%, which is better than the expected decline of 1.0%.
All ten of the sectors are in negative territory, led by a 1.8% drop in financials as AIG (AIG 24.59, -4.50) plunges 16%. The energy (-0.1%) and tech (-0.1%) sectors are outperforming on a relative basis
The tech-heavy Nasdaq is outperforming, as it did yesterday, with a loss of 0.5% compared to the S&P 500's decline of 0.8%.DJ30 -122.94 NASDAQ -11.48 SP500 -9.96 NASDAQ Adv/Vol/Dec 748/217 mln/1579 NYSE Adv/Vol/Dec 636/141 mln/2084
09:40 am : There is not much positive news this morning -- two Dow components reported disappointing results, oil prices are rising and the number of new unemployment claims unexpectedly increased. As a result, the stock market gets off to a sharply lower start.
AIG (AIG 24.97, -4.12) reported a massive loss of $5.4 billion, marking its third consecutive quarter of negative earnings. On an adjusted basis, AIG lost $0.51 per share, which fell well short of the expected profit of $0.63 per share. The result includes a pretax charge of roughly $5.6 billion for a net unrealized market valuation loss related to AIG Financial Products super senior credit default swap portfolio.
Wal-Mart (WMT 58.18, -2.58) reported a 3.0% increase in July same-store sales, although shares are still coming under pressure as the retailing giant was expected to post 3.3% growth.
In economic news, an increase in the number of weekly initial jobless claims raised concerns about the labor market. For the week ended Aug. 2, new jobless claims rose 1.6% to 455,000, compared to the expected reading of 420,000 claims.
Meanwhile, oil prices are up 1.8% to $120.75 per barrel, after declining around 5% during the previous three sessions.DJ30 -150.79 NASDAQ -20.55 SP500 -14.15
09:15 am : S&P futures vs fair value: -11.3. Nasdaq futures vs fair value: -15.1.
09:00 am : S&P futures vs fair value: -11.7. Nasdaq futures vs fair value: -15.0. Futures continue to indicate a lower start as the latest jobless claims reading raises concerns about the labor market. The NY Post reports that Lehman Brothers (LEH) CEO Dick Fuld is in "scramble mode" to try and raise capital to ensure the company does not get split up. LEH is down 3% in premarket trading. Treasuries are seeing some buying interest, with the 10-year note up 19 ticks, sending its yield down to 3.99%.
08:30 am : S&P futures vs fair value: -11.0. Nasdaq futures vs fair value: -14.0. Stock market futures extend their losses on a worse-than-expected unemployment claims reading. Initial jobless claims for the week ended Aug. 2 rose 1.6% to 455,000. Economists expected 420,000 claims. Target (TGT) reports a 1.2% drop in July same-store sales, which is worse than the expected drop of 0.2%.
08:16 am : S&P futures vs fair value: -11.3. Nasdaq futures vs fair value: -15.2.
08:00 am : S&P futures vs fair value: -7.5. Nasdaq futures vs fair value: -10.2. Futures suggest a lower open after disappointing results from two Dow components. AIG (AIG) reported a second quarter loss of $0.51 per share, ex-items, which is $1.14 worse than the consensus estimate, sending shares of AIG tumbling 11% in premarket trading. Shares of Wal-Mart (WMT) are down 3.4% in premarket trading after the company reported July same-store sales rose 3%, which fell short of the Briefing.com consensus that called for 3.3% growth. Meanwhile, crude prices are up 1.7% to $120.60 per barrel, which follows a drop of more than 5% over the three previous sessions. As expected, the European Central Bank left its benchmark rate unchanged at 4.25%, and the Bank of England left its rate at 5.00%.
06:10 am : S&P futures vs fair value: -3.3. Nasdaq futures vs fair value: -3.0.
06:09 am : FTSE...5511.70...+25.60...+0.5%. DAX...6595.70...+34.31...+0.5%.
06:09 am : Nikkei...13124.99...-129.90...-1.0%. Hang Seng...22104.20...+154.45...+0.7%.
My posting is for my own entertainment, do your own DD before pushing your buy/call button
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