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US close: Stocks reverse on poor economic data
Tue, 22 May, 2012
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US close: Stocks reverse on poor economic data
Thu, 26 Jan 2012, 23:02:00
The major US equity benchmarks ended the day lower after the release of worse than expected readings on leading economic indicators and new home sales this afternoon. The Federal Reserve's well-received statement released last night was not enough to offset the trend. 
 
 The Fed, which had previously said it would maintain the federal funds rate between 0% and 0.25% until mid-2013, announced on Wednesday that it intends to leave them as they are until late 2014. According to the Federal Open Market Committee (FOMC), "economic conditions - including low rates of resource utilization and a subdued outlook for inflation over the medium run - are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014." 
 
 The commitment to keep interest rates low for even longer had some pundits wondering how banks are going to make fat profits in such an environment. Meanwhile, the disappointing housing figures (see below) hit demand for house builders such as <b>Lennar</b> and <b>Pulte</b>. 
 
 Biotechnology firm <b>Amgen</b> finished down after it announced that it plans to acquire rival <b>Micromet</b> for $11 per share, equivalent to around $1.16bn. The world's largest biotech company explained that the deal will strengthen its cancer-drug research pipeline. 
 
 Corporate results from the likes of earth-moving equipment maker <b>Caterpillar</b>, pay TV provider <b>Time Warner</b> and aeronautics company <b>Lockheed Martin</b> came in better than expected, but those from phone company <b>AT&T</b> were a bit more mixed. AT&T posted a fourth quarter net loss of $6.7bn compared to a profit of $2.1bn a year earlier, despite record smartphone sales in the period. The company took a $4bn pre-tax charge related in part to the failed takeover of T-Mobile USA
 
 Shares of <b>LSI Logic</b>, the computer network storage technology company, finished the day still very much up, having published results yesterday.
 
 <b>Netflix</b> retained its positive position after an upgrade from Citigroup to "buy" from "neutral". 
 
 Manufacturing giant <b>3M</b> also rounded off the day in a top spot after reporting forecast-beating profits as strong sales growth in its industrial and transportation divisions helped offset weakness elsewhere. 
 
 Fourth quarter earnings per share came in at $1.35, topping the consensus estimate of $1.31. Net income rose to $954m from $928m in the year-ago period. Revenue rose 6% to $7.09bn, in line with the consensus estimate. 
 
 Retailer <b>JC Penney</b> was deemed a January bargain after it raised expectations on how much money its turnaround plan may save in 2012. 
 
 
 <b>MACROECONOMY</b>
 
 Initial weekly unemployment claims fell by 22,000 to 377,000 last week (Consensus: 374,000). Continuing claims reached 3.554m (Consensus: 3.5m).
 
 The index of leading economic indicators for the month of December showed a rise of 0.4% on the month (Consensus: 0.7%).
 
 Durable goods orders for the month of December grew by 3.0% on the month (Consensus: 2.0%). Core durable goods orders have increased by 2.9% on the month. 
 
 New home sales came in at 307,000 for December (Consensus: 320,000). 
 
 <b>OTHER MARKETS</b>
 
 West Texas Intermediate sweet light crude for March delivery ended the day 30 cents higher at $99.70 a barrel in trading on the New York Mercantile Exchange.
 
 On the bonds market, 10-year Treasuries rose 18/32 of a dollar, pushing the yield down 6/100 of a point to 1.93%.
 
 
 <b>S&P 500 - Risers</b>
 Netflix Inc. (NFLX) $116.01 +22.06%
 J.C. Penney Co. Inc. (JCP) $40.72 +18.82%
 LSI Logic Corp. (LSI) $7.85 +10.88%
 Time Warner Cable Inc. (TWC) $74.51 +7.81%
 First Solar Inc. (FSLR) $40.94 +6.03%
 Janus Capital Group Inc. (JNS) $7.99 +5.56%
 Owens-Illinois Inc. (OI) $24.41 +5.12%
 CBRE Group Inc (CBG) $19.01 +4.74%
 Ball Corp (BLL) $39.36 +4.40%
 Dover Corp. (DOV) $62.93 +3.40%
 
 <b>S&P 500 - Fallers</b>
 Monster Worldwide Inc. (MWW) $7.15 -20.38%
 E*TRADE Financial Corp. (ETFC) $7.99 -14.64%
 Sandisk Corp. (SNDK) $46.39 -11.37%
 Range Resources Corp. (RRC) $55.92 -6.58%
 Chesapeake Energy Corp. (CHK) $21.90 -6.33%
 Lincoln National Corp. (LNC) $20.69 -5.70%
 Precision Castparts Corp. (PCP) $166.34 -5.64%
 Zions Bancorporation (ZION) $16.58 -5.37%
 SunTrust Banks Inc. (STI) $20.50 -5.18%
 EQT Corp. (EQT) $48.34 -5.14%
 
 <b>Dow Jones I.A - Risers</b>
 Caterpillar Inc. (CAT) $111.31 +2.07%
 3M Co. (MMM) $87.58 +1.27%
 Johnson & Johnson (JNJ) $65.70 +0.74%
 
 <b>Dow Jones I.A - Fallers</b>
 AT&T Inc. (T) $29.45 -2.52%
 Hewlett-Packard Co. (HPQ) $27.99 -1.17%
 Alcoa Inc. (AA) $10.36 -1.15%
 Chevron Corp. (CVX) $106.59 -1.06%
 Verizon Communications Inc. (VZ) $37.34 -0.93%
 Wal-Mart Stores Inc. (WMT) $60.97 -0.81%
 Travelers Company Inc. (TRV) $58.70 -0.76%
 Home Depot Inc. (HD) $44.95 -0.68%
 Bank of America Corp. (BAC) $7.30 -0.68%
 
 
 <b>Nasdaq 100 - Risers</b>
 First Solar Inc. (FSLR) $40.94 +6.03%
 Amazon.Com Inc. (AMZN) $193.32 +2.94%
 CH Robinson Worldwide Inc (CHRW) $69.47 +2.00%
 Virgin Media Inc. (VMED) $24.47 +1.70%
 Liberty Interactive Corp (LINTA) $16.92 +1.62%
 J.B. Hunt Transport Services Inc. (JBHT) $49.30 +1.38%
 Starbucks Corp. (SBUX) $48.34 +1.19%
 
 <b>Nasdaq 100 - Fallers</b>
 Logitech International S.A. (LOGI) $7.20 -11.98%
 Sandisk Corp. (SNDK) $46.39 -11.37%
 Illumina Inc. (ILMN) $52.65 -4.53%
 Citrix Systems Inc. (CTXS) $65.00 -3.86%
 Warner Chilcott Plc (WCRX) $16.34 -3.03%
 
 
 NR
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