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« January 2007 |
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| March 2007 »
Stocks rallied and rebound from their biggest one-day point drop in over five years in the previous session, although the major averages all closed lower on the month. Investors found comfort in a partial recovery of the Shanghai stock market, and soothing words from Federal Reserve Chairman Ben Bernanke.
Today, the Dow industrials closed up 52.39 or 0.46% to 12,268.63, the broader S&P 500 closed up 7.78 or 0.53% to 1,406.82, and the Nasdaq closed up 8.27 or 0.34% to 2,416.13. For the month, the Dow finished down 2.8%, the S&P 500 lost 2.2% and the Nasdaq declined 1.9%.
Market breadth was positive. On the New York Stock Exchange, winners topped losers by a margin of 22 to 11 on volume of 2.246 billion shares. On the Nasdaq, advancers beat decliners by a margin of 16 to 13 as 2.638 billion shares changed hands.
Bernanke calmed investors after he informed a House Panel that while there was no single trigger to Tuesday's market slide, financial markets "seem to be working well." He said that the economy may strengthen later this year, that there was no liquidity problem in financial markets, and that troubles from the sub-prime mortgage markets are not impacting the broader economy. He reiterated that the sell-off hasn't altered the Fed's view on U.S. economic growth.
Yesterday’s decline of 3.3% tells investors that stocks historically go through extremely rough periods, and that those perilous interludes usually follow strong markets that push prices to the limit. The underlying sentiment still seems to be bullish, but now that the upward trend has been broken, it's made investors put the thinking cap on.
On the economic front, new home sales fell 16% in January. New homes sold at an annual rate of 937,000, against the expected 1.08 million pace. The percentage decline was biggest for a single month in 13 years, since the record 23.8%t decline seen in January 1994.
Shares of Home Depot (NYSE: HD) dropped 0.6% after saying the housing market won't get better until the second half of 2007 or early 2008. Its forecasts found echo in a report showing that new homes sales plunged 16.6% in January to their lowest sales pace in four years. It was the lowest sales pace in four years and represented the biggest percentage decline in 13 years. Sales were down 20.1% compared with January 2006.
Stock of Apple Inc. (Nasdaq: AAPL) shares rose after the CEO Tim Cook reiterated that the company remains on track to release its iPhone mobile-phone product in June, and that Apple expects to sell 10 million of the devices in 2008.
Integra LifeSciences (NYSE: IART) said fourth-quarter net income slipped to $10.1 million, from $10.6 million, while revenue climbed 72% to $125 million on sales of acquired products, surgical instruments and ultrasonic surgical systems. Analysts expected a revenue of $121 million. For 2007, revenue is seen to be between $508 million and $520 million.
U.S. light crude oil for April delivery rose 33 cents to settle at $61.79 a barrel on the New York Mercantile Exchange.
Stocks plunged to their worst one-day performance since 2001, with the Dow Jones Industrial Average losing 200 points in one minute around 3 p.m. before recovering some ground by the close, after a sell-off in China fueled concerns about growth. Stocks tumbled across the board, after declining global markets and a steep drop in durable goods orders triggered a massive sell-off on Wall Street. Trying to limit the declines, the NYSE said it imposed trading curbs as of 1:03 p.m. ET, around the time the Dow slipped 200 points.
Today, the Dow Jones industrial average closed down 416.02 or 3.29% to 12,216.24, its biggest one-day point loss since the day the stock market reopened after the Sept. 11th attacks. The blue-chip barometer has now fallen for five sessions straight. The broader S&P 500 closed down 50.33 or 3.47% to 1,399.04, and saw its biggest one-day percentage loss in nearly four years. The S&P 500 also slumped for the previous four sessions. The Nasdaq closed down 96.65 or 3.86% to 2,407.87, its biggest one-day percentage loss since Dec. 9, 2002.
Market breadth was negative On the New York Stock Exchange, decliners trounced advancers by almost 29 to 4 on volume of 2.31 billion shares. On the Nasdaq, losers beat winners by more than 14 to 1 on volume of 3.05 billion shares.
Global mayhem started with the Chinese stocks slipping 9% - the worst one-day sell-off in a decade - on concerns that the government would interfere to cool the speculation that drove the Shanghai market up nearly 130% last year. Other Asian markets slumped in tandem, and European shares followed.
The sell-off demonstrates the inter-connectedness of stock markets around the world. The slump in world markets exacerbated concerns that Wall Street is due for a sell-off after a nearly eight-month rally that has sent the Dow industrials to record highs and the Nasdaq and S&P 500 to more than 6-year highs. Market veterans have been looking for a stock sell-off for some months due to the combination of slowing economic and earnings growth expected this year.
Amongst economic news, the existing home sales grew at a faster-than-expected pace in January, and the consumer confidence saw a surprise rise in February versus forecasts for a drop. Orders for durable goods sank a much sharper-than-expected 7.8% in January as non-defense goods orders saw their biggest monthly decline ever. Economists had forecast that orders for durable goods would fall 2.5%.
Stock of Wal-Mart Stores Inc (NYSE: WMT). fell 3.6% after it agreed to acquire 35% of Trust-Mart, a Taiwanese-owned operator of hypermarkets in China. The world's largest retailer has reportedly agreed to pay around $1 billion for the stake. Taking full control of Trust-Mart would more than double Wal-Mart's retail footprint in China, where it currently operates 68 Super-centers, three Sam's Clubs, and two Neighborhood Markets in 36 cities.
Stock of Apple Computers (Nasdaq: AAPL) closed at $88.65, after declining that its Apple TV will be delayed until mid-March. A company spokeswoman said that Apple Inc. will delay until mid-March its Apple TV device for playing computer-based video on television sets. Apple, in early January said it would launch in February the $299 Apple TV, which wirelessly links computers to televisions.
U.S. light crude oil for April delivery rose 41 cents to $61.80 a barrel on the New York Mercantile Exchange. The price of oil rose for the last four sessions.
Stock of Wal-Mart Stores Inc (NYSE: WMT). fell 3.6% after it agreed to acquire 35% of Trust-Mart, a Taiwanese-owned operator of hypermarkets in China. The world's largest retailer has reportedly agreed to pay around $1 billion for the stake. Taking full control of Trust-Mart would more than double Wal-Mart's retail footprint in China, where it currently operates 68 Super-centers, three Sam's Clubs, and two Neighborhood Markets in 36 cities.
Stocks fell as concerns about growth resurfaced with oil prices holding above $61 a barrel, dampening investor enthusiasm and offsetting the latest deal-making news, including the $45 billion takeover of TXU Corp (NYSE: TXU). Blue chips fell for the fourth session in a row, as investors opted to bail out of a variety of sectors.
Today, the Dow Jones industrial average closed down 15.22 or 0.12% to 12,632.26, declining for the fourth session in a row, the S&P 500 closed down 1.82 or 0.13% to 1,449.37, and the Nasdaq closed down 10.58 or 0.42% to 2,504.52.
Market breadth was negative. On the New York Stock Exchange, losers and winners were roughly even on volume of 1.56 billion shares. On the Nasdaq, decliners beat advancers 17 to 12 on volume of 1.90 billion shares.
The rise in oil and gold prices kept inflationary concerns up front. Additionally, the weakness in the broader financial sector added to last week's worries about sub-prime lenders. The market also received a jolt after news that former Federal Reserve chairman Alan Greenspan warned that the U.S. economy might slip into recession this year.
Over the next few days, investors will be sorting through the bevy of economic news that is on tap, including reports due tomorrow on durable goods orders, consumer confidence and existing home sales.
Stock of Texas utility (NYSE: TXU) closed up $7.91 or 13% to $67.93, after agreeing to a $45 billion cash and debt buyout led by two private equity firms and the private equity unit of investment bank Goldman Sachs. This is the largest private equity buyout in history. The group will pay $69.25 a share for the company, a premium of 15.4% over Friday's close. The cash component of the deal is valued at $32.3 billion.
Shares of Station Casinos (NYSE: STN) closed up $3.20 or 4.2% to $86.50, after agreeing to be taken private for $5.4 billion by a firm led by its management. The total transaction is valued at approximately $8.8 billion, including a $3.4 million debt. FCP has agreed to pay $90 per share in cash, which marks a 30% premium over Station's closing stock price on Dec. 1.
Shares of XM Satellite Radio Inc. (Nasdaq: XMSR) fell 1% to close at $14.93, after its fourth-quarter loss narrowed from a year ago as revenue rose 45% and subscription acquisition costs declined. The company agreed last week to a $13.6 billion merger with Sirius Satellite Radio Inc. (Nasdaq: SIRI), a deal expected to face close regulatory scrutiny and potentially have trouble winning approval.
U.S. light crude oil for April delivery rose 25 cents to settle at $61.39 a barrel on the New York Mercantile Exchange.
Shares of Station Casinos (NYSE: STN) closed up $3.20 or 4.2% to $86.50, after agreeing to be taken private for $5.4 billion by a firm led by its management. The total transaction is valued at approximately $8.8 billion, including a $3.4 million debt. FCP has agreed to pay $90 per share in cash, which marks a 30% premium over Station's closing stock price on Dec. 1.
Stock of Texas utility (NYSE: TXU) closed up $7.91 or 13% to $67.93, after agreeing to a $45 billion cash and debt buyout led by two private equity firms and the private equity unit of investment bank Goldman Sachs. This is the largest private equity buyout in history. The group will pay $69.25 a share for the company, a premium of 15.4% over Friday's close. The cash component of the deal is valued at $32.3 billion.
U.S. stocks closed lower, putting in a mixed performance for the week, amid heightened jitters about the sub-prime mortgage market, rising oil prices and a court ruling against Microsoft Corp (Nasdaq: MSFT). Investors are displaying signs of stress and fatigue and they're locking in profits as they become more concerned about the market being at high levels. The Dow Jones industrial average down for the third straight session, as investors focused on higher oil and gold prices.
Today, the Dow closed down 38.54 or 0.30% to 12,647.48, the broader S&P 500 closed down 5.19 or 0.36% to 1,451.19, and the tech-heavy Nasdaq closed down 9.84 or 0.39% to 2,515.10. For the week, the Dow fell 0.9%, the S&P 500 was down 0.3% and the Nasdaq gained 0.7%. But for the month, the Dow, S&P and Nasdaq are all on track to end slightly higher.
Market breadth was negative. On the New York Stock Exchange, losers edged out winners on volume of 1.4 billion shares. On the Nasdaq, decliners topped advancers by a margin of 9 to 7 on volume of 2.1 billion shares.
Higher oil prices lead to a decline in blue chip stocks. The geopolitical unrest in the Middle East added fuel to fire. In the absence of any economic news, and with oil and gold prices continuing to move higher, investors are becoming a little skittish.
Stock of Microsoft (Nasdaq: MSFT) closed down $0.49 or 1.5% to $28.90, after a U.S. federal jury ruled that the software leader infringed on audio patents held by Alcatel-Lucent (NYSE: ALA) and should pay $1.52 billion in damages. Microsoft plans to seek relief on the verdict from the trial court, as the verdict is unsupported by the law or facts. Shares of Alcatel-Lucent closed up $0.21 to $13.28.
Shares of Lowe's (NYSE: LOW) closed up $1.30 to $34.93, after reporting lower fourth-quarter earnings that nonetheless topped estimates and also issuing a first-quarter and full-year forecast that is in line with analysts' estimates. It reported a 11.5% drop in fourth-quarter earnings as the battered U.S. housing market hurt sales. Total sales fell about 4% to $10.4 billion in the quarter, better than analyst estimates, while sales at stores open at least a year declined 5.3%.
Shares of Yum Brand (NYSE: YUM) closed down $0.55 or 1% to $60.51, after a pack of rats were seen scurrying around a closed KFC/Taco Bell restaurant in New York City. The restaurant had been cited in December for a number of health code violations, including evidence of rodents and live cockroaches.
U.S. light crude oil for April delivery rose 19 cents to $61.14 a barrel on the New York Mercantile Exchange, giving back bigger gains. This was after the United States reported an unexpected drop in gasoline stocks and Iran said it would show "no weakness" regarding its nuclear program.
Shares of Lowe's (NYSE: LOW) closed up $1.30 to $34.93, after reporting lower fourth-quarter earnings that nonetheless topped estimates and also issuing a first-quarter and full-year forecast that is in line with analysts' estimates. It reported a 11.5% drop in fourth-quarter earnings as the battered U.S. housing market hurt sales. Total sales fell about 4% to $10.4 billion in the quarter, better than analyst estimates, while sales at stores open at least a year declined 5.3%.
Shares of Yum Brand (NYSE: YUM) closed down $0.55 or 1% to $60.51, after a pack of rats were seen scurrying around a closed KFC/Taco Bell restaurant in New York City. The restaurant had been cited in December for a number of health code violations, including evidence of rodents and live cockroaches.
Stocks closed mixed with the broad market weighed down after the United Nations' nuclear watchdog said Iran had failed to meet a deadline to stop nuclear enrichment, but with tech shares making a late comeback on upbeat news for several stocks. The Dow Jones industrial average slumped for a second session, amid rising oil prices, and a jump in Treasury bond yields.
Today, the Dow Jones industrial average closed down 52.39 or 0.41% to 12,686.02, while the broader S&P 500 closed down 1.25 or 0.09% to 1,456.38. The Nasdaq closed up 6.52 or 0.26% to 2,524.94, at a fresh six-year high for the third session in a row.
Market breadth was mixed. On the New York Stock Exchange, losers beat winners 17 to 14 on volume of 1.47 billion shares. On the Nasdaq, advancers topped decliners 16 to 13 on volume of 2.04 billion shares.
Technology shares rose, thanks to upbeat earnings from chip maker Analog Devices (NYSE: ADI) and the end of Cisco (Nasdaq: CSCO) and Apple's (Nasdaq: AAPL) trademark dispute. A merger in the grocery sector had added to the market's early strength. However, stocks were pressured by rising oil prices amid a surprise dip in weekly energy inventories and a U.N. report that Iran has missed the deadline to suspend nuclear activities. However, news that Iran is not complying with the United Nations was not particularly surprising, and the stock sell-off may just reflect investors getting a little antsy after the recent advance.
Stock of Whole Foods (Nasdaq: WFMI) closed up $6.41 to $52.11, after stating that it will buy Wild Oats (Nasdaq: OATS) for around $565 million in cash. Stock of Wild Oats closed $2.69 to $18.41, in active trading. This will allow Whole Foods to compete with much larger traditional grocers, which are increasingly offering organic foods. Whole Foods will pay $18.50 a share in cash - an 18% premium to the company's closing share price on Wednesday. Whole Foods will also assume $106 million of Wild Oats' debt.
Shares of Cisco (Nasdaq: CSCO) closed up $0.02 to $27.40, and Apple Computers (Nasdaq: AAPL) closed up $0.31 to $89.51, after reaching an agreement so that both can use the iPhone name. This agreement has been reached after Cisco sued the iPod maker for using it for a new multimedia phone. In addition, the two companies will explore opportunities to work together in the areas of security, and consumer and institutional communications.
Stock of Toll Brothers (NYSE: TOL) closed down $0.93 or 3.6% to $31.93, after reporting sharply lower fiscal first-quarter profit, reflecting the ongoing collapse of the housing market. It also lowered its fiscal 2007 forecast. Its quarterly net earnings fell, after a $96.9 million write-down for the lower value of land, as the housing market continued to flounder. It earned $54.3 million, down from $163.9 million in the year earlier quarter.
Stock of Microsoft (Nasdaq: MSFT) closed up $0.04 to $29.39, after a U.S. federal jury ruled that it infringed on audio patents held by Alcatel-Lucent and should pay $1.52 billion in damages. Hares of Alcatel closed up $0.07 to $13.14. Microsoft said it plans to seek relief on the verdict as it is unsupported by the law or facts, and it may appeal.
U.S. light crude oil for April delivery rose 88 cents to settle at $60.95 a barrel on the New York Mercantile Exchange after the weekly oil inventories report showed a large drop in gasoline and oil inventories.
Stock of Toll Brothers (NYSE: TOL) closed down $0.93 or 3.6% to $31.93, after reporting sharply lower fiscal first-quarter profit, reflecting the ongoing collapse of the housing market. It also lowered its fiscal 2007 forecast. Its quarterly net earnings fell, after a $96.9 million write-down for the lower value of land, as the housing market continued to flounder. It earned $54.3 million, down from $163.9 million in the year earlier quarter.
Shares of Cisco (Nasdaq: CSCO) closed up $0.02 to $27.40, and Apple Computers (Nasdaq: AAPL) closed up $0.31 to $89.51, after reaching an agreement so that both can use the iPhone name. This agreement has been reached after Cisco sued the iPod maker for using it for a new multimedia phone. In addition, the two companies will explore opportunities to work together in the areas of security, and consumer and institutional communications.
Stock of Whole Foods (Nasdaq: WFMI) closed up $6.41 to $52.11, after stating that it will buy Wild Oats (Nasdaq: OATS) for around $565 million in cash. Stock of Wild Oats closed $2.69 to $18.41, in active trading. This will allow Whole Foods to compete with much larger traditional grocers, which are increasingly offering organic foods. Whole Foods will pay $18.50 a share in cash - an 18% premium to the company's closing share price on Wednesday. Whole Foods will also assume $106 million of Wild Oats' debt.
Stocks closed mixed on being hit by a disappointing earnings outlook from Hewlett-Packard Co. (NYSE: HPQ) and news that consumer prices rose more than expected in January, which fueled concern about inflation. However, minutes from the Federal Reserve's last meeting on interest rates, showed that the Fed wasn't overly concerned about inflation at the end of January, and somewhat soothed the market's worries.
Today, the Dow closed down 48.23 or 0.4% to 12,738.41, the broader S&P 500 closed down 2.05 to 1,457.63, and the tech-fueled Nasdaq closed up 5.38 to 2,518.42.
Market breadth was negative. On the New York Stock Exchange, losers beat winners 17 to 15 on volume of 1.43 billion shares. On the Nasdaq, decliners topped advancers by a narrow margin on volume of 2.06 billion shares.
Investors digested the release of the minutes from the last Federal Reserve policy meeting which reiterated what they have been saying lately, that the economy is moderating but not too quickly, and that inflation remains a concern, even though it seems to be waning. The afternoon also brought comments from a trio of Fed officials that built on the same message of the economy slowing at a reasonable pace, but inflation remaining a worry.
The morning's Consumer Price Index showed a surprising resilience in a key inflation measure. The CPI rose 0.2% versus expected rise of 0.1%, while the core CPI rose 0.3%, above forecasts for a 0.2% gain. The report was a surprise to investors looking for a further confirmation that pricing pressure is waning.
Shares of Arcelor Mittal (NYSE: MT) closed 1.6% higher, after reporting a 3.5% slip in 2006 net income due to a higher tax rate and also said it will distribute $2.4 billion to shareholders via a dividend and share buybacks. Full-year pro-forma profit fell to $7.97 billion from $8.26 billion. Its EBITDA rose 2.1% to $15.27 billion in 2006, but missed analysts' expectations of $15.32 billion. In the fourth quarter, Arcelor-Mittal earned $2.37 billion, compared with $2.18 billion, in the third quarter. Sales climbed 5% to $23.3 billion. The company generated $4.3 billion in cash during the latest quarter and cut debt by $2.3 billion.
Stock of Hewlett-Packard (NYSE: HPQ) closed down $2.03 or 4.7% to $41.10, despite reporting quarterly sales and earnings that increased from a year earlier and topped estimates. The company also forecast fiscal year 2007 sales and earnings in a range that beats analysts' forecasts. Its net income rose to $1.5 billion, up 26% from $1.2 billion a year ago. Quarterly revenue rose 11% to $25.1 billion during the quarter, from $22.6 billion a year ago. Analysts were anticipating the company to report $24.3 billion in sales during the quarter.
Shares of NovaStar Financial (NYSE: NFI) closed down $7.46 or 42.5% to $10.10, after it reported a fourth-quarter loss and said it would have little or no taxable income next year. It reported a loss of $14.4 million, compared with a year-earlier profit of $28.1 million.
Stock of United Technologies Corp. (NYSE: UTX) slipped 0.8%, as one of its unit Otis was fined a total of $1.3 billion by the European Commission for allegedly rigging prices to install and maintain escalators and elevators. The fine narrowly tops the 855 million euro penalty against eight vitamin makers in 2001 and a recent 750 million euro fine for electrical generation equipment makers.
U.S. light crude oil for April delivery jumped $1.22 to settle at $60.07 a barrel on the New York Mercantile Exchange, a gain of over two percent.
Stock of United Technologies Corp. (NYSE: UTX) slipped 0.8%, as one of its unit Otis was fined a total of $1.3 billion by the European Commission for allegedly rigging prices to install and maintain escalators and elevators. The fine narrowly tops the 855 million euro penalty against eight vitamin makers in 2001 and a recent 750 million euro fine for electrical generation equipment makers.
Stock of Hewlett-Packard (NYSE: HPQ) closed down $2.03 or 4.7% to $41.10, despite reporting quarterly sales and earnings that increased from a year earlier and topped estimates. The company also forecast fiscal year 2007 sales and earnings in a range that beats analysts' forecasts. Its net income rose to $1.5 billion, up 26% from $1.2 billion a year ago. Quarterly revenue rose 11% to $25.1 billion during the quarter, from $22.6 billion a year ago. Analysts were anticipating the company to report $24.3 billion in sales during the quarter.
Shares of Arcelor Mittal (NYSE: MT) closed 1.6% higher, after reporting a 3.5% slip in 2006 net income due to a higher tax rate and also said it will distribute $2.4 billion to shareholders via a dividend and share buybacks. Full-year pro-forma profit fell to $7.97 billion from $8.26 billion. Its EBITDA rose 2.1% to $15.27 billion in 2006, but missed analysts' expectations of $15.32 billion. In the fourth quarter, Arcelor-Mittal earned $2.37 billion, compared with $2.18 billion, in the third quarter. Sales climbed 5% to $23.3 billion. The company generated $4.3 billion in cash during the latest quarter and cut debt by $2.3 billion.
Stocks rose and sent the Dow Jones Industrial Average to a record closing level, as reassuring comments from Federal Reserve Governor Susan Bies, along with upbeat results from Wal-Mart Stores Inc. (NYSE: WMT) and merger news, helped offset disappointing earnings from Home Depot Inc (NYSE: HD).
Today, the Dow Jones industrial average closed up 19.07 or 0.15% to 12,786.64, the broader S&P 500 closed up 4.14 or 0.28% to 1,459.68, and the tech-fueled Nasdaq closed up 16.73 or 0.67% to 2,513.04.
Market breadth was positive. On the New York Stock Exchange, losers beat winners by 5 to 3 on volume of 1.32 billion shares. On the Nasdaq, advancers topped decliners three to two on volume of 2.25 billion shares.
The comments from the Fed's Bies that since the beginning of the year, the market has tended to welcome any economic news showing inflation pressures are receding, which might allow the Federal Reserve to cut interest rates, reassured the markets. While the day started off on a negative note as investors back tracked after last week's run, the tone improved by midday, with the Nasdaq composite taking the lead.
Stock of Wal-Mart (NYSE: WMT) closed up $1.68 to $50.16, after reporting higher quarterly earnings that topped forecasts on sales that missed estimates. Its net income rose to $3.94 billion, up almost 10% from $3.59 billion in the period a year earlier. Revenue jumped nearly 11% during the quarter to $98.09 billion as it aggressively slashed prices during the holiday season. However, sales results fell below analysts' forecasts for revenue of $99.6 billion.
Stock of Home Depot (NYSE: HD) closed down $0.15 to $41.29, after reporting lower quarterly earnings that missed estimates. It posted a 28% drop in fourth quarter profit as the weak U.S. housing market depressed sales at its retail stores. Earnings in the fourth quarter fell to $925 million, from $1.3 billion, a year earlier. Total sales rose 4% to $20.3 billion, below analysts' estimates of $20.8 billion. Retail store sales fell 2% to $17.4 billion, while sales at stores open at least a year fell 6.6%. Sales at Home Depot Supply, rose 64% to $2.9 billion.
Stock of Sirius (Nasdaq: SIRI) jumped nearly 7% and XM Satellite (Nasdaq: XMSR) shares gained 13% on news of their deal. Although there was some doubt about whether regulators would approve the deal. Shares of Sirus closed up $0.22 to $3.92, and those of XM Satellite closed up $1.44 to $15.42. Each will own half of the combined company, which would offer listeners a much wider variety of programming, including sports, news and high-profile entertainers such as shock jock Howard Stern. XM Chairman Gary Parsons would remain chairman of the combined firm, while Sirius' Mel Karmazin would assume the role of CEO. The company would have a market value of roughly $13 billion, including approximately $1.6 billion in net debt. XM shareholders would get 4.6 shares of Sirius stock for each share of XM they own.
Shares of JetBlue (Nasdaq: JBLU) closed down $0.66 or 5% to $12.90, its CEO announced an overhaul that could cost the company $30 million dollars. The tag includes about $10 million for refunding tickets for canceled flights, $16 million for issuing travel vouchers and $4 million for incremental costs such as hiring overtime crews.
U.S. light crude oil for March delivery tumbled $1.49 to $57.90 a barrel on the New York Mercantile Exchange.
Shares of JetBlue (Nasdaq: JBLU) closed down $0.66 or 5% to $12.90, its CEO announced an overhaul that could cost the company $30 million dollars. The tag includes about $10 million for refunding tickets for canceled flights, $16 million for issuing travel vouchers and $4 million for incremental costs such as hiring overtime crews.
Stock of Sirius (Nasdaq: SIRI) jumped nearly 7% and XM Satellite (Nasdaq: XMSR) shares gained 13% on news of their deal. Although there was some doubt about whether regulators would approve the deal. Shares of Sirus closed up $0.22 to $3.92, and those of XM Satellite closed up $1.44 to $15.42. Each will own half of the combined company, which would offer listeners a much wider variety of programming, including sports, news and high-profile entertainers such as shock jock Howard Stern. XM Chairman Gary Parsons would remain chairman of the combined firm, while Sirius' Mel Karmazin would assume the role of CEO. The company would have a market value of roughly $13 billion, including approximately $1.6 billion in net debt. XM shareholders would get 4.6 shares of Sirius stock for each share of XM they own.
Stock of Home Depot (NYSE: HD) closed down $0.15 to $41.29, after reporting lower quarterly earnings that missed estimates. It posted a 28% drop in fourth quarter profit as the weak U.S. housing market depressed sales at its retail stores. Earnings in the fourth quarter fell to $925 million, from $1.3 billion, a year earlier. Total sales rose 4% to $20.3 billion, below analysts' estimates of $20.8 billion. Retail store sales fell 2% to $17.4 billion, while sales at stores open at least a year fell 6.6%. Sales at Home Depot Supply, rose 64% to $2.9 billion.
Stock indexes logged gains of over a percent for the week, with the Dow scraping out a third record high close amid otherwise mixed markets as investors consolidated gains ahead of a three-day weekend. However, data suggested economic weakness, including a big drop in housing starts, falling consumer confidence and a cautious outlook from Microsoft Corp (Nasdaq: MSFT).
Today, the Dow closed up 2.56 or 0.02% to 12,767.57, the broader S&P 500 closed down 1.27 or 0.09% to 1,455.54, and the tech-fueled Nasdaq closed down 0.79 or 0.03% to 2,496.31. For the week, the Dow gained 1.5%, the S&P closed up 1.2%, and the Nasdaq gained 1.5%.
Market breadth was positive. On the New York Stock Exchange, winners edged out losers on volume of 1.35 billion shares. On the Nasdaq, advancers beat decliners by a narrow margin of 4 to 3 on volume of 1.918 billion shares.
While stocks have gained on the back of Federal Reserve Chairman Ben Bernanke's congressional statements, the economic report has been a mixed bag. Housing starts plunged in January to the slowest pace since 1997, throwing doubts that the struggling housing market is stabilizing. The Producer Price Index (PPI), fell a larger-than-expected 0.6%t in January. The Core PPI, which excludes volatile food and energy prices, rose 0.2%, as expected. The University of Michigan Consumer Sentiment index dipped to 93.3 in February from 96.9 last month, below forecasts for a drop to 96.5.
Shares of Microsoft (Nasdaq: MSFT) closed down $0.72 or over 2% to $28.74, after the software leader's CEO said that some analysts' forecasts for Vista revenue in fiscal-year 2008 are too aggressive. He also said that operating expenses should wane.
Stock of AMR (NYSE: AMR) closed up $0.79 or 2% to $38.84, on media reports that the parent of American Airlines may be a buyout target for a group that includes Goldman Sachs (NYSE: GS) and British Airways (NYSE: BAB). The proposed bid is said to be between $9.8 billion, or $46 a share, and $11.1 billion, or $52 a share.
Shares of Compass Bancshares (Nasdaq: CBSS) closed up $4.33 or 6% to $70.70, after Spain's second largest bank offered to buy the U.S. regional bank for $9.6 billion, a more than 16% premium over its Thursday closing price.
U.S. light crude oil for March delivery rose $1.40 to $59.390 a barrel on the New York Mercantile Exchange.
Stock of AMR (NYSE: AMR) closed up $0.79 or 2% to $38.84, on media reports that the parent of American Airlines may be a buyout target for a group that includes Goldman Sachs (NYSE: GS) and British Airways (NYSE: BAB). The proposed bid is said to be between $9.8 billion, or $46 a share, and $11.1 billion, or $52 a share.
Shares of Microsoft (Nasdaq: MSFT) closed down $0.72 or over 2% to $28.74, after the software leader's CEO said that some analysts' forecasts for Vista revenue in fiscal-year 2008 are too aggressive. He also said that operating expenses should wane.
Stocks closed higher, with the Dow Jones Industrial Average setting another record high, bolstered by Caterpillar Inc.'s (NYSE: CAT) share buyback and another spate of merger news. Investors eyed mixed economic news, a rebound in oil prices and the conclusion of Fed chief Ben Bernanke's two days of congressional testimony.
Today, the Dow Jones industrial average closed up 23.15 or 0.18% to 12,765.01, the broader S&P 500 closed up 1.51 or 0.105 to 1,456.81, the tech-fueled Nasdaq closed up 8.72 or 0.35% to 2,497.1.
Market breadth was positive. On the New York Stock Exchange, winners beat losers 19 to 13 on volume of 1.377 billion shares. On the Nasdaq, advancers barely edged decliners 15 to 14 on volume of 1.972 billion shares.
Beyond Bernanke's testimony, investors are continuing to look to economic news to get a sense of whether the economy is indeed meeting the Fed's forecast. There has been an ebb and flow of stronger and weaker economic reports.
A report showed a drop in industrial production in January and a bigger-than-expected decline in capacity utilization. Additionally, there has been a surprising rise in new unemployment claims. The number surged a bigger-than-expected 44,000 last week to hit 357,000 for the week ended Feb. 10. On the upside, the February NY Empire State index, rose to 24.4 in the month, rebounding from a weak previous month and easily topping forecasts.
Stock of Caterpillar (NYSE: CAT) closed up $1.54 or 2% to $67.70, after the heavy equipment maker said it was buying back $7.5 billion of its own stock.
Shares of Baker Hughes (NYSE: BHI) closed down $6.61 or 9% to $65.33, after reporting higher quarterly earnings that missed forecasts.
Stock of RealNetwork (Nasdaq: RNWK) closed down $1.68 or 14% to $8.99, after the digital media company warned that first-quarter sales will miss analysts' estimates. The forecast overshadowed the company's otherwise positive fourth-quarter earnings report.
Shares of Baidu.com (Nasdaq: BIDU) closed down $8.55 or 10% to $106.45, after the Chinese Internet company warned l that first-quarter sales won't meet analysts' forecasts. The company also reported higher fourth-quarter earnings, but investors focused on the forecast.
U.S. light crude oil for March delivery fell 1 cent to $57.99 a barrel on the New York Mercantile Exchange, after losing around 2 percent in the morning.
Stocks rallied and pushed the Dow Jones Industrial Average to a record close as investors cheered soothing words from Federal Reserve Chairman Ben Bernanke on inflation. The market also welcomed upbeat earnings from Applied Materials Inc. (Nasdaq: AMAT) and discussion of a restructuring at DaimlerChrysler Corp (NYSE: DCX). Bernanke spoke of inflation moderating, that unemployment won't be a problem and that there are tentative signs of housing stabilizing.
Today, the Dow closed up 87.01 or 0.69% to 12,741.86, to close at a record high, taking out its previous record from two weeks ago. The broader S&P closed up 11.04 or 0.76% to 1,455.30, and the tech-fueled Nasdaq closed up 28.50 or 1.16% to 2,488.38.
Market breadth was positive. On the New York Stock Exchange, winners trounced losers seven to four on volume of 1.5 billion shares. On the Nasdaq, advancers topped decliners nine to seven as 2.2 billion shares changed hands.
The broad market was pushed higher as investors were reassured by Bernanke's views on inflation. In his speech, the Fed chief said that, the incoming data have supported the view that the current stance of policy is likely to foster sustainable economic growth and a gradual ebbing of core inflation. However, he also reiterated that the main risk to current policy is that inflation doesn't ease as expected, at which point the Fed will be prepared to "take action." Investors reacted positively to his outlook on inflation.
Investors also responded well to the January retail sales report, which showed a smaller-than-expected rise in both overall sales and sales excluding autos. This seemed to temper recent worries that stronger-than-expected economic growth could cause the Fed to start raising rates again this year.
Shares of DaimlerChrysler (NYSE: DCX) jumped 8.3% to close at $69.78, after the automaker said it would consider " far reaching" options for Chrysler, including finding a partner. It also expects to eliminate 13,000 jobs in the Chrysler division. The move aims to cut $4.5 billion in costs as the company struggles to get back in the black by 2008.
Shares of Applied Materials (Nasdaq: AMAT) closed up $0.70 or 4% to $18.89, after reporting quarterly earnings that beat forecast. While revenue was less than expected, investors focused on the strong earnings and positive forecast. Its net profit was $403.5 million, compared with $142.8 million a year earlier. Revenue was $2.28 billion, up 23% from a year earlier but lower than the $2.35 billion expected by analysts.
Shares of IBM (NYSE: IBM) closed up almost 1%, after the company claimed a breakthrough in developing circuitry to store data on future microprocessor chips. Stock of Coca-Cola (NYSE: KO) fell 0.7% after the company said fourth-quarter net income dropped 22%, hurt by an impairment charge for Coca-Cola Enterprises. However, these results excluding the charge still beat forecasts
U.S. light crude oil for March delivery slumped $1.06 to $58 a barrel on the New York Mercantile Exchange after a mixed weekly inventory report. The report showed a surprise drop in gasoline and crude supplies but a less than expected drawdown of distillates used to make heating oil.
Shares of Applied Materials (Nasdaq: AMAT) closed up $0.70 or 4% to $18.89, after reporting quarterly earnings that beat forecast. While revenue was less than expected, investors focused on the strong earnings and positive forecast. Its net profit was $403.5 million, compared with $142.8 million a year earlier. Revenue was $2.28 billion, up 23% from a year earlier but lower than the $2.35 billion expected by analysts.
Shares of DaimlerChrysler (NYSE: DCX) jumped 8.3% to close at $69.78, after the automaker said it would consider "far reaching" options for Chrysler, including finding a partner. It also expects to eliminate 13,000 jobs in the Chrysler division. The move aims to cut $4.5 billion in costs as the company struggles to get back in the black by 2008.
Stocks rallied to a sharply higher close with the Dow Jones Industrial Average gaining 100 points after a report Alcoa Inc. (NYSE: AA) may be a takeover target and news that 3M Co. (NYSE: MMM) plans a large stock buyback. Investors saw strength across the board, with a rebound in commodity shares and an upgrade of GM (NYSE: GM).
Today, the Dow Jones industrial average closed up 101.50 or 0.81% to 12,654.05, the S&P 500 closed up 10.89 or 0.76% to 1,444.26, and the tech-fueled Nasdaq closed up 9.50 or 0.39% to 2,459.88.
Market breadth was positive. On the New York Stock Exchange, winners beat losers 3 to 1 on volume of 1.45 billion shares. On the Nasdaq, advancers topped decliners 17 to 11 on volume of 1.84 million shares.
Investors are anticipating positively, Federal Reserve Chairman Ben Bernanke's two day semi-annual monetary policy report to Congress. Investors will be looking to see if his economic outlook is "focused more on the recent signs of stronger growth and lower core inflation, or on the impact from the slowdown in the housing market."
The positive news of the day overshadowed the report that the trade gap surged more than expected in December and hit a record in 2006. The trade deficit jumped 6.5% to a record $763.6 billion last year as high oil prices and Americans' appetite for foreign-made goods outpaced strong exports. The deficit came even as U.S. exports surged to a record $1.44 trillion last year, up 12.3% from 2005. But imports also jumped, up 10.5% to about $2.20 trillion for the year.
Shares of Caremark Rx (NYSE: CMX) closed up $1.97 or 3% to $62.88, after drug store CVS (NYSE: CVS) increased its bid by tripling a proposed special cash dividend to $6 a share. Stock of CVS closed down $0.40 to $32.09. CVS would pay $23.7 billion, or $54.26 per share, in stock plus the $6 cash dividend. On the other hand, Express Scripts' cash-and-stock offer has valued Caremark at $26.6 billion, or $61.08 per share.
Stock of 3M (NYSE: MMM) closed up $1.84 or 2.3% to $76.43, after its board approved a $7 billion share buyback plan and boosted its quarterly dividend. It has proposed to buy back up to $7 billion of its own shares over the next two years.
Shares of General Motors (NYSE: GM) closed up $0.88 or 2% to $36.59, after Merrill Lynch upgraded it to "buy" from "sell." The basis is that the automaker will use its liquidity and assets, specifically in its pension fund, to "affect positive change.
Shares of the Nasdaq Stock Market Nasdaq: NDAQ) closed down $4.00 or 10% to $31.10, as investors continued to ditch the stock following news that it lost its bid for the London Stock Exchange. The failed deal overshadowed the company's strong quarterly earnings.
Stock of Johnson & Johnson (NYSE: JNJ) lost 0.1% after the company said it told federal prosecutors and regulators that units outside the U.S. are believed to have made improper payments in two small-market countries.
U.S. light crude oil for March delivery rallied $1.34 to $59.15 a barrel on the New York Mercantile Exchange. Oil prices slid 3.5% after the oil ministers of Saudi Arabia and Qatar said OPEC may keep crude output unchanged at its March meeting.
Stock of 3M (NYSE: MMM) closed up $1.84 or 2.3% to $76.43, after its board approved a $7 billion share buyback plan and boosted its quarterly dividend. It has proposed to buy back up to $7 billion of its own shares over the next two years.
Shares of Caremark Rx (NYSE: CMX) closed up $1.97 or 3% to $62.88, after drug store CVS (NYSE: CVS) increased its bid by tripling a proposed special cash dividend to $6 a share. Stock of CVS closed down $0.40 to $32.09. CVS would pay $23.7 billion, or $54.26 per share, in stock plus the $6 cash dividend. On the other hand, Express Scripts' cash-and-stock offer has valued Caremark at $26.6 billion, or $61.08 per share.
Stocks closed lower as disappointing deal news and uncertainty over Federal Reserve Chairman Ben Bernanke's testimony to Congress later this week offset the boost an Apple Inc. (Nasdaq: AAPL) upgrade and a strategic move announced by Home Depot Inc (NYSE: HD). News that the Nasdaq Stock Market (Nasdaq: NDAQ) is abandoning its bid for the London Stock Exchange, also dented sentiment, somewhat offsetting the usual boost from Monday-merger news. It looks like the market is in need of more of a corrective move.
Today, the Dow Jones industrial average closed down 28.28 or 0.22% to 12,552.55, the S&P 500 closed down 4.69 or 0.33% to 1,433.37, and the tech-fueled Nasdaq closed down 9.44 or 0.38% to 2,450.38.
Market breadth was negative. On the New York Stock Exchange, losers beat winners 19 to 12 on volume of 1.32 billion shares. On the Nasdaq, decliners topped advancers 17 to 13 on volume of 1.89 billion shares.
A host of merger and acquisition reports failed to counter the impact of a 3.5% decline in oil prices. The decline in oil dragged on energy stocks, which in turn limited the broader market's advance. This week, investors are looking for reports on retail sales, housing and manufacturing, as well as Fed Chairman Bernanke's visit to Capitol Hill. His comments will be closely monitored for hints about the economy and interest rate policy. After the market's latest advance, stocks are likely to drift or even decline a bit for the short term, particularly with the earnings reporting period over. With around 75% of the S&P 500 fourth-quarter results having already been reported, earnings are currently on track to have risen just short of 11%.
Shares of Home Depot (NYSE: HD) closed up $0.44 or 1.6% to $41.44, on reports that it is considering the sale of its wholesale distribution unit, HD Supply, as it focuses on its retail business. HD supply has an annual revenue of about $12 billion. HD Supply has nearly 1,000 locations in the United States and Canada and has more than 26,000 employees.
Stock of Four Seasons (NYSE: FS) closed down $2.52 to $81.36, after it agreed to be taken private for $3.8 billion, including debt, by an investment group that included a firm run by Bill Gates and Saudi Prince Alwaleed bin Talal. Investors have offered $82 in cash per limited voting share in the deal.
In another news, Blackstone Group has decided to acquire Pinnacle Foods Group, the owner of Vlasic Pickles, Duncan Hines and other brands, for about $2.2 billion. Pinnacle Foods is jointly owned by affiliates of J.P Morgan Partners, J.W. Childs Associates L.P., CDM Group, and by former bondholders of Aurora Foods Inc.
Shares of Vodafone (NYSE: VOD) closed up $0.58 to $29.53, after it won a majority stake in Indian mobile firm Hutchison Essar, in a deal worth $11.1 billion. This values India's fourth-biggest mobile firm at around $19 billion, including debt. India's Essar Group, which owns 33% of Hutch Essar and had also been bidding for the 67% being sold by Hutchison Telecommunications International Ltd, confirmed the deal on Sunday. The deal is a critical move by Vodafone CEO Arun Sarin, who is under pressure amid slowing growth in Vodafone's core European markets to expand the business while at the same time not overpay for acquisitions.
U.S. light crude oil for March delivery sank $2.08 to settle at $57.81 a barrel on the New York Mercantile Exchange after the oil ministers of Saudi Arabia and Qatar said OPEC may keep crude output unchanged at its March meeting.
Shares of Home Depot (NYSE: HD) closed up $0.44 or 1.6% to $41.44, on reports that it is considering the sale of its wholesale distribution unit, HD Supply, as it focuses on its retail business. HD supply has an annual revenue of about $12 billion. HD Supply has nearly 1,000 locations in the United States and Canada and has more than 26,000 employees.
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