Stock Market News for August 10, 2012 - Market News
10 Agosto 2012 - 11:06AM
Zacks
Benchmarks ended their see-saw ride
on Thursday with only paltry gains. Despite, the meager gains, the
S&P 500 extended its stay in the green into a fifth consecutive
day. However, the Dow closed in the red as investors were caught in
a dilemma, whether to focus on positives at home or the negative
economic reading from China.
The Dow Jones Industrial Average
(DJI) dropped 0.08% to end 10.45 points lower at 13,165.19. The
Standard & Poor 500 (S&P 500) edged up a mere 0.04% to
finish yesterday’s trading session at 1,402.80. The tech-laden
Nasdaq Composite Index gained 0.3% and was up to 3,018.64. The
fear-gauge CBOE Volatility Index shed 0.3% and settled at 15.28.
Consolidated volumes on the New York Stock Exchange, the American
Stock Exchange and Nasdaq were roughly 5.41 billion shares, once
again lower than 2011’s daily average of 7.84 billion shares.
Advancing stocks moved past the decliners on the NYSE; as for 53%
stocks that gained, 43% closed in negative territory.
Markets struggled to find definite
direction through the day’s trading session. While the benchmarks
added modest points in the morning, they slipped into the red soon
after noon, only to rebound once again. Investors have gained
strength from what has become the S&P 500’s longest winning
stretch since March this year. Apart from trading over its
psychological level of 1, 400, the S&P 500 has gained over 10%
since June 1, when it registered a five-month low. A major factor
behind this uptrend is the earnings results by S&P 500
companies. A Bloomberg data noted that 72% of the S&P 500
companies have managed to outperform the Street estimates in the
second quarter.
Investors were faced with both
positive as well negative developments yesterday. The dilemma was
evident in the benchmarks’ movement. For one, investors were
greeted by further encouraging labor data. The U.S.
Department of Labor reported that the advance figure for seasonally
adjusted initial claims dropped 6,000 from prior week’s revised
figure of 367,000 to 361,000 in the week ending August 4. This also
compared favorably with consensus estimates of 370, 000. As a quick
reminder, this is the second set of positive labor data after a
strong government nonfarm payroll report had helped benchmarks snap
their four-day losing streak last Friday.
Thus, investors’ confidence about
labor conditions was buoyed for the second time. Meanwhile, the
U.S. Census Bureau and the U.S. Bureau of Economic Analysis,
through the Department of Commerce, reported that trade deficit
narrowed in June. According to the data: “Total June exports of
$185.0 billion and imports of $227.9 billion resulted in a goods
and services deficit of $42.9 billion, down from $48.0 billion in
May, revised. June exports were $1.7 billion more than May exports
of $183.3 billion. June imports were $3.5 billion less than May
imports of $231.4 billion”. Consensus estimates had expected a
trade deficit of 47.5. The trade deficit was at its lowest in 18
months.
Amidst these positives, investors’
sentiment was somewhat jolted after China’s factory output growth
was down to the weakest level in over three years. The
second-largest economy’s yearly industrial output growth weakened
to 9.2% in July, according to National Bureau of Statistics. This
was lower than June’s level of 9.5%. Also, ‘the finished goods
inventory sub-index of the manufacturing purchasing managers index’
was down to 48 in July as against June’s reading of 53.2, thus
suggesting a contraction. Further, there was evidence of slowing
demand for raw materials as the producer price index suffered a
yearly decline of 2.9% in July.
Thus, investors struggled to gain a
perspective, leaving benchmarks unsure of a definite direction. As
for the individual stocks, E TRADE Financial Corporation
(NASDAQ:ETFC) jumped sharply by 6.9% following an announcement that
CEO Steven Freiberg has been sacked. On the earnings front, Kohl's
Corporation (NYSE:KSS) reported soft sales numbers but managed to
edge past estimates. However, the company’s shares lost 1.2%.
Monster Beverage Corp (NSDAQ:MNST) slumped 9.7% after missing
estimates. Meanwhile, NVIDIA Corporation (NASDAQ:NVDA) and
Nordstrom, Inc. (NYSE:JWN) were slated to report their results
after the closing bell.
Separately, English soccer club
Manchester United was en route to finalize its initial public
offering and Financial Times quoted a close source saying that
“Institutional investors have shown strong interest”. Each share of
the 19-time English Premier League champion boasting star players
like Wayne Rooney and Nani will reportedly be priced in the range
of $16 to $20. Manchester United will trade under the ticker name
MANU and the club giant will be offering 16.7 million class A
shares.
E TRADE FINL CP (ETFC): Free Stock Analysis Report
NORDSTROM INC (JWN): Free Stock Analysis Report
KOHLS CORP (KSS): Free Stock Analysis Report
MONSTER BEVERAG (MNST): Free Stock Analysis Report
NVIDIA CORP (NVDA): Free Stock Analysis Report
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