Market Update 080219 http://biz.yahoo.com/mu/update.html 4:30 pm : The major indices opened sharply higher on Tuesday without a specific catalyst, but eventually ended the day with modest losses due to weakness in financials and tech as inflation concerns weighed on sentiment. Although the declines are slight, when compared to this session's highs they are more significant. The Dow, Nasdaq and S&P fell 1.3%, 2.0% and 1.0%, respectively, from their session highs to their closing levels.
Financials (-0.8%) once again weighed on the broader market, with investment services posting the largest decline. The Wall Street Journal reported Lehman Brothers (LEH 53.57, -1.20) may face its rockiest quarter since the mortgage crisis began, noting it may face $1.3 billion in additional write-downs. Also adding to the selling pressure was news that Credit Suisse (CS 48.22, -2.66) had overvalued assets by about $2.85 billion, with the company blaming a small number of traders for the write-down.
Tech (-1.0%) was also a laggard. Internet stocks saw the most selling pressure. Google (GOOG 508.95, -20.69) was the main laggard with a 4% decline. Silicon Alley Insider noted Google may face near term pressure on revenues due to "accidental" advertising clicks that were stated in the company's 10-K. Yahoo! (YHOO 29.01, -0.65) declined after Bill Gates said Microsoft (MSFT 28.17, -0.14) won't raise its bid for the company, according to Reuters. Also weighing on Yahoo's stock are reports that Microsoft is preparing for a proxy fight.
Shares of AT&T (T 35.89, -1.99) and Verizon (VZ 35.34, -2.49) got clipped after Verizon announced it is offering a $99.99 per month unlimited wireless plan. AT&T quickly responded with a matching plan of its own. Traders fear a pricing war will crimp profits for both of the Dow components. As a result, telecom (-5.1%) finished the day as the main laggard.
A strong $4.51 gain in crude oil provided a lift to the energy sector. Crude was up on news of an explosion yesterday at a Texas refinery that shut down its operations, unrest in Nigeria and speculation that OPEC may cut output. Crude hit an all-time intraday high of $100.10 per barrel, and settled at an all-time closing high of $100.01.
Likewise, the materials sector (1.9%) was a standout due to a strong advance in commodities price. Agriculture companies Monsanto (MON 117.87, +2.52) and Mosaic (MOS 109.41, +6.41) provided leadership. Gold producer and Briefing.com Active Portfolio holding Newmont Mining (NEM 50.48, +2.59) posted a hefty gain as gold advanced $23.90 to $930.00 per ounce.
The soaring commodities fueled inflation concerns, spurring a sell-off in Treasuries. The 30-year bond shed 47 ticks, sending its yield up to 4.67%. The market will get an inflation reading tomorrow, with January's CPI reading set for release at 8:30 ET.
In earnings news, Wal-Mart (WMT 49.66, +0.22) reported earnings of $1.04 per share, topping expectations by two cents. The company issued conservative guidance for its first quarter and fiscal 2009, which limited the stock's advance.
Also making headlines was news that Fidel Castro will step down as president and commander in chief of Cuba. Due to the country's minuscule economy, this news had a limited effect on the stock market. DJ30 -10.99 NASDAQ -15.60 NQ100 -0.9% R2K +0.1% SP400 +0.1% SP500 -1.21 NASDAQ Dec/Adv/Vol 1528/1392/1.99 bln NYSE Dec/Adv/Vol 1379/1763/1.43 bln
3:30 pm : The Dow and S&P 500 join the Nasdaq in the red as the financial sector falls back toward its session low. Some stocks that are posting steep declines include Lehman Brothers (LEH 53.60, -1.17), Merrill Lynch (MER 49.91, -1.73), Bear Stearns (BSC 79.56, -3.23), Freddie Mac (FRE 27.56, -0.84).
Although losses are modest, when compared to this session highs the decline is substantial. For instance, the Dow is down 188 points, or 1.5%, from its highs seen shortly after the opening bell. The Nasdaq is down 2.2% from its highs.DJ30 -31.26 NASDAQ -18.59 SP500 -3.61 NASDAQ Dec/Adv/Vol 1610/1299/1.61 bln NYSE Dec/Adv/Vol 1471/1657/1.12 bln
3:00 pm : Stocks give up most of their gains with the Nasdaq falling into negative territory. Tech is playing a large role in the weakness as it falls into the red. Google (GOOG 508.35, -21.29), the main laggard, is now down 4%. Telecom is also weighing on the broader market with a 4.2% decline, although its weighting is small when compared to tech.
Crude oil hit an all-time intraday high of $100.10, and then settled at an all-time closing high of $100.01.DJ30 +19.13 NASDAQ -9.31 SP500 +0.78 NASDAQ Dec/Adv/Vol 1330/1797/1.43 bln NYSE Dec/Adv/Vol 1330/1797/999 mln
2:30 pm : The major indices continue to trade modestly below their best levels. Crude oil has touched $100 per barrel, and is currently fluctuating near that mark.
Of the 30 Dow components, 24 are trending higher. Oil companies Exxon Mobil (XOM 87.72, +2.35) and Chevron (CVX 85.43, +1.83) are leading the advance due to the surge in oil prices. The main laggards are telecom companies Verizon (VZ 36.16, -1.66) and AT&T (T 36.34, -1.54). The Associated Press reported that Verizon Wireless offered a flat unlimited calling plan for $99.99, which AT&T quickly matched. The companies' stocks are lower as traders feel the pricing war will lead to lower profits for both companies.DJ30 +98.83 NASDAQ +9.95 SP500 +9.89 NASDAQ Dec/Adv/Vol 1168/1717/1.27 bln NYSE Dec/Adv/Vol 970/2144/893 mln
2:00 pm : Stocks continue to trade in the green but have dipped a bit as crude oil surpasses the $99 mark.
Crude oil climbs higher, now up nearly $4 to $99.45 per barrel. Crude prices are trading at their highest levels since early January, when crude reached a non-inflation adjusted all-time high, slightly surpassing the $100 mark.
Advancers outpace decliners by more than 2-to-1 on the NYSE and by 1.5-to-1 on the Nasdaq. New 52-week highs outpace new lows by 1.5-to-1 on the NYSE, while new 52-week lows outpace new highs by 5.5-to-1 on the Nasdaq.DJ30 +93.95 NASDAQ +10.75 SP500 +10.98 NASDAQ Dec/Adv/Vol 1198/1658/1.16 bln NYSE Dec/Adv/Vol 1048/2053/818 mln
1:25 pm : The major indices get a boost as the Dow crosses back into triple digit territory. The recent gains in stocks is weighing on the 10-year note, which is now down 34/32 ticks.
The National Association of Home Builders Housing Market Index increased for the second time in a row. The reading came in at 20, slightly higher than the consensus estimate of 19. A reading of 50 is considered average, so this number is still weak. The report helped homebuilders (+2.4%) climb to their best level of the session.DJ30 +115.19 NASDAQ +17.28 SP500 +12.01 NASDAQ Dec/Adv/Vol 1117/1734/1.04 bln NYSE Dec/Adv/Vol 949/2139/740 mln
1:00 pm : The stock market ran into resistance as it gives up some of its gains. Financials continue to act as the limiting factor to the broader market, although they remain off their worst levels.
MedcoHealth Solutions (MHS 51.60, +2.62) is a standout this session. The pharmacy benefit management services company reported earnings of $0.43 per share, topping the consensus estimate by two cents. The company also issued full year 2008 earnings guidance of $2.27 to $2.31 per share, compared to the estimate of $2.20. As a whole, health care stocks are modestly outperforming the broader market.DJ30 +82.39 NASDAQ +12.72 SP500 +8.23 NASDAQ Dec/Adv/Vol 1240/1597/946 mln NYSE Dec/Adv/Vol 1147/1911/667 mln
12:30 pm : The major indices continue to regain lost ground as the Dow approaches triple digits. The major indices have remained in the green throughout the session, but have seen some choppy action.
Financials (-0.4%) are well off their session lows thanks to strength in insurance companies. Tech (+0.8%) has also seen a boost, lifted by office equipment companies.DJ30 +97.85 NASDAQ +16.21 SP500 +10.24 NASDAQ Dec/Adv/Vol 1175/1633/861 mln NYSE Dec/Adv/Vol 1074/1992/610 mln
12:00 pm : The major indices opened sharply higher without a specific catalyst, and then drifted steadily lower as the financial sector fell into the red. At midday, the indices are posting decent gains, but remain well off their opening highs.
Financials are the under selling pressure, with investment services posting the largest decline. The Wall Street Journal reported that Lehman Brothers (LEH 53.62, -1.15) may face a substantial write-down.
Tech is also underperforming on a relative basis. Internet stocks are seeing the most selling pressure. Google (GOOG 517.53, -12.11) is a laggard as it slides 2%.
The energy sector is providing a boost to the broader market. A strong $2.50 gain in crude oil prices are providing a lift to the sector. Crude is up on news of an explosion yesterday at a Texas refinery that shut down its operations. Also, there is speculation that OPEC may cut output.
Likewise, the materials sector is a standout as commodity prices advance. Some notable names include agriculture companies Monsanto (MON 119.44, +4.09) and Mosaic (MOS 108.40, +5.03). Gold producer and Briefing.com Active Portfolio holding Newmont (NEM 50.62, +2.73) is also posting a hefty gain as gold adds $24.80 to $930.90 per ounce.
In earnings news, Wal-Mart (WMT 50.00, +0.56) reported earnings of $1.04 per share, topping expectations by two cents. The company issued conservative guidance for its first quarter and fiscal 2009, which is limiting the stock's advance.
Also making headlines is news that Fidel Castro will step down as president and commander in chief of Cuba. Due to the country's minuscule economy, this news had limited effect on the stock market.
There are no economic reports this session, although tomorrow the market will digest the January CPI reading and housing starts at 8:30 ET.DJ30 +78.48 NASDAQ +11.12 R2K +0.6% SP400 +0.8% SP500 +7.94 NASDAQ Dec/Adv/Vol 1225/1567/760 mln NYSE Dec/Adv/Vol 1097/1938/545 mln
11:30 am : In the past half hour, the major indices fall to their worst levels of the session, although they remain positive territory. Financials (-1.1%) continue to struggle, with investment services shedding 1.6%.
Tech (+0.2%) is also now underperforming on a relative basis. Internet stocks are playing a large role in the sectors weakness, with Google (GOOG 518.03, -11.61) the main laggard. The Nasdaq is a laggard as a result.DJ30 +67.11 NASDAQ +6.60 SP500 +5.84 NASDAQ Dec/Adv/Vol 1279/1462/650 mln NYSE Dec/Adv/Vol 1220/1797/469 mln
11:00 am : The major indices attempt to recover after steadily sliding off their opening highs. The Dow is modestly outperforming the other major indices but remains roughly 62 points off its session high, when it was up 157 points.
The two newcomers to the Dow, Bank of America (BAC 43.03, +0.33) and Chevron (CVX 85.24, +1.64), are both trading higher. The companies replaced Altria (MO 73.06, +0.53) and Honeywell (HON 56.77, +0.73).DJ30 +94.27 NASDAQ +13.11 SP500 +9.57 NASDAQ Dec/Adv/Vol 1126/1603/539 mln NYSE Dec/Adv/Vol 1088/1900/387 mln
10:35 am : The major indices continue to post healthy gains, modestly below their best levels seen shortly after the opening bell.
The financial sector (-0.1%) is a laggard, which is limiting the broader market’s gains. AIG (AIG 47.55, +1.44), however, is a standout this session after seeing steep declines last week on write-down concerns. Barron’s reported the company appears to be a value at current levels. At Friday's closing price, the stock was down 21% year-to-date.DJ30 +106.89 NASDAQ +16.72 SP500 +10.62 NASDAQ Dec/Adv/Vol 954/1681/407 mln NYSE Dec/Adv/Vol 885/2071/285 mln
10:00 am : The stock market continues to post substantial gains due to broad-based buying interest. Oil & gas is a standout in the early-going, posting a gain of 2.8% as crude trades above $98 per barrel.
The strength in equities have weighed on Treasuries in the early-going. The 10-year note is down 24 ticks, sending its yield up to 3.9%.DJ30 +110.47 NASDAQ +18.01 SP500 +10.81 NASDAQ Dec/Adv/Vol 730/1815/232 mln NYSE Dec/Adv/Vol 746/2127/173 mln
09:40 am : The stock market opens on a high note despite seemingly bearish news. European banks Credit Suisse (CS) and Barclays (BCS) warned about increased write-downs and the Wall Street Journal reported that Lehman Brothers (LEH) may face a substantial write-off. Oil has also climbed higher as it trades around $98.00 per barrel after a Texas refinery was shutdown due to an explosion yesterday and speculation that OPEC may cut output.
In earnings news, Wal-Mart (WMT) topped its expectations but issued a conservative guidance for its first quarter and 2009.
Also making headlines is news that Fidel Castro will step down as president and commander in chief of Cuba. Due to the country's minuscule economy, this news should not be construed as the reason for this session's bullish bias in the early going.DJ30 +136.85 NASDAQ +24.78 SP500 +14.15 NASDAQ Dec/Adv/Vol 540/1863/109 mln NYSE Dec/Adv/Vol 395/2197/85 mln
09:16 am : S&P futures vs fair value: +15.4. Nasdaq futures vs fair value: +25.5.
09:02 am : S&P futures vs fair value: +15.4. Nasdaq futures vs fair value: +24.0. Futures dip off their best levels but continue to indicate a higher start for the stock market. MBIA’s (MBI) new CEO Jay Brown is “optimistic” that a deal involving NY Insurance Superintendent Dinallo may happen in next two weeks according to CNBC. The company has been in dialogue with rating agencies.
08:31 am : S&P futures vs fair value: +18.3. Nasdaq futures vs fair value: +29.0. Stock futures point to a significantly higher start, near their best levels of the session. The Microsoft (MSFT) and Yahoo! (YHOO) deal is again garnering attention this morning. Of note, Bill Gates said Microsoft is not raising its Yahoo bid, according to Reuters. Microsoft’s roughly 2% advance in pre-market trading is helping to support the futures market's gains. The economic calendar is empty this session.
08:00 am : S&P futures vs fair value: +13.8. Nasdaq futures vs fair value: +23.5. Futures point to a higher start despite a pair of European banks warning about increased write-downs and a WSJ report that indicates Lehman Brothers (LEH) may face its rockiest quarter. Wal-Mart (WMT) topped its earnings estimates, but guided its first quarter and fiscal 2009 estimates on the conservative side. Also making headlines is news that Fidel Castro is retiring as president and commander in chief of Cuba.
06:20 am : S&P futures vs fair value: +7.4. Nasdaq futures vs fair value: +17.0.
06:19 am : FTSE...5930.60...-16.00...-0.3%. DAX...6931.25...-36.30...-0.5%.
06:19 am : Nikkei...13757.91...+122.51...+0.9%. Hang Seng...24123.17...+363.92...+1.5%.
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