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After The Close - Stocks resumed their advance today, after a brief pause yesterday when investors feared the Federal Reserve was hatching a plan to unwind its extraordinary monetary support. No such fears were to be found in the just-ended session, though. Not that there was a lot to get excited about, in terms of earnings or the economy. It was simply the kind of up day that often occurs during a bull market when cash comes in from the sidelines.

By the close, the Dow Jones Industrial Average had tacked on another 123 points and the NASDAQ had gained 24 points, with the major indexes surging in the final half-hour. Small and mid-cap stocks fared especially well.

There was one piece of good news on the economy, in the form of a report from the New York Federal Reserve showing that the total amount of debt held by U.S. citizens was at its lowest level in nearly seven years. Wall Street tends to see that in terms of consumers having greater spending capacity.

Among stock market sectors, banks performed especially well. Bank of America (BAC - Free Bank of America Stock Report) was the leading percentage gainer on the Dow. Shares of Citigroup (C) also fared well, although JPMorgan Chase’s (JPM - Free JPMorgan Chase Stock Report) stock advanced less, possibly owing to concerns that it could potentially lose the leadership of Jamie Dimon, its Chairman and CEO, if those roles are split.

Elsewhere, oil prices were the loser on the day, after a report suggested that rising oil production from the United States would be more than enough to account for any increase in global demand.   

But the correction that Wall Street has been waiting for to begin will have to wait at least another day. A temporary interruption to the stock market’s advance, which would be seen by some as healthy and normal, could come from another blow-up in Europe. However, Europe has been relatively quiet in recent weeks.

A series of disappointing reports on the economy could also prompt a round of profit-taking. With that in mind, tomorrow brings a full slate of economic data, including the Producer Price index for April; a report from the New York Fed on the region’s manufacturing; and April figures on the nation’s industrial production and capacity utilization.

Meanwhile, earnings from farm equipment maker Deere (DE), retailer Macy’s (M), and tech heavyweight Cisco Systems (CSCO - Free Cisco Stock Report) are due out on Wednesday, with Cisco reporting after the closing bell.   - Robert Mitkowski
         
At the time of this writing, the author did not have any positions in of the companies mentioned. 

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12:25 PM EDT -  The stock market got off to a decent start this morning and is now extending its gains. At just past noon in New York, the Dow Jones Industrial Average is up 73 points (0.5%); the broader S&P 500 Index is ahead 13 points (0.8%); and the tech-heavy NASDAQ is tacking on 26 points (0.7%). Furthermore, market breadth indicates considerable support for equities, as advancing stocks are ahead of decliners by over 2 to 1 on the NYSE. There are roughly 580 stocks at new highs versus only 55 at new lows on the NYSE, confirming the market’s upward bias. All of the market sectors are participating in the rally today, with large gains in the healthcare issues. In addition, the consumer stocks are doing well. In contrast, the basic materials sector is lagging, though less than earlier. It is interesting to note that this group, along with some of the energy names, showed leadership earlier in the bull market, but has been lagging for quite some time. This clearly shows how traders engage in sector rotation, and the importance of watching for this behavior.

Technically, the S&P 500 Index has spent the past few sessions in a narrow sideways range, but seems to be breaking out with today’s move. Assuming the strength continues, the index will soon be testing the 1,650 mark, which may hold some psychological significance. In a somewhat contrarian showing, the VIX is higher today to 13.14, which may suggest that some traders are still apprehensive about the long-standing rally.

The few economic reports released this morning are probably not responsible for today’s move up. The Department of Commerce reported that export prices declined 0.5%, and import prices dipped 0.2%, for the month of April. These figures suggest that there is likely little in the way of inflation to worry about. Tomorrow is a busy day for reports, as we receive the Producer Price Index for April, the Empire Manufacturing Survey for May, as well as a report on industrial production for last month.

There was some corporate news of note today. Take-Two Interactive (TTWO) shares are trading sharply higher after that company logged strong sales and profits for the most-recent quarter. Also, shares of Sony (SNE) are moving up as the electronics giant affirmed that it would not be divesting its important entertainment businesses. Adam Rosner

At the time of this article’s writing the author did not have positions in any of the companies mentioned.

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Stocks to Watch from The Survey Earnings news is quite light today, though shares of Take-Two Interactive Software (TTWO) are up sharply in pre-market trading, after the video game developer delivered March-quarter results that topped investors’ expectations thanks, in part, to strong sales of its BioShock Infinite game. Meantime, the recent surge in the shares of electric vehicle manufacturer Tesla Motors (TSLA) appears set to continue today, as that equity is indicating a nicely higher opening this morning.

Elsewhere, Sony (SNE) stock is up notably ahead of the bell, after the hedge fund Third Point, which owns about 6.5% of SNE shares, called for the Japan-based electronics giant to spin off its entertainment division, arguing that it would unlock value for shareholders. – Matthew E. Spencer 

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.

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Before The Bell - The stock market paused yesterday after weeks of steady gains, as the leading averages either held steady or tracked a bit lower on the day. In all, the Dow Jones Industrial Average lost 27 points; the Standard and Poor's 500 Index was virtually flat; the NASDAQ added two points; and the small-cap Russell 2000 eased by just over a point. Most mutual funds lost a few pennies, as losing stocks topped winning issues by a generally modest ratio.

There weren't a great many issues to deal with yesterday. To wit, earnings season is fast drying up, and it has been a decent one, on the whole, with many more U.S. corporations exceeding lowered profit targets, but on just selective revenue growth. This has been the pattern in recent quarters, and it has not unnerved investors to any extent as yet.

On the economic front, however, there was one key release of note, as the government reported that retail sales increased by 0.1% in April. That was notably better than the forecast, which had been for a decline of 0.4% in aggregate spending last month. In the meantime, if we back out the auto component, including cars and vehicle parts, we find that sales dipped by 0.1% in April. Still, that was better than the 0.4% drop that had been generally forecast for the month. On a year-over-year basis, total retail volume has been up by 3.7% in the past year. Also, March retail sales, which had been reported as declining by 0.4%, were revised to indicate a slightly larger drop of 0.5%.

Meantime, the business beat quiets down a bit today, but will pick up again tomorrow, as we will get metrics on producer prices. Here, a fairly large drop in wholesale costs is expected to have been tallied last month, largely on falling oil prices. We also will get data on industrial production and factory use, where slight declines are the expectation. Then, on Thursday, we are due to see data on initial jobless claims, where a slight gain for the latest week is the general forecast. That day also will bring reports on consumer prices, housing starts, and building permits. Here, as well, inflation is seen as tame, with the CPI falling by 0.3% in April. Housing starts are likewise expected to have dipped in the latest month, but building permits, a more forward-looking metric, are seen as having edged a little higher. Finally, Friday will see the generation of data on consumer sentiment and the leading indicators.

As to earnings, the bigger stories on the week are scheduled to be the issuances from Dow component and networking giant Cisco Systems (CSCOFree Cisco Stock Report), as well as from farm equipment maker Deere & Co. (DE), semiconductor equipment manufacturer Applied Materials (AMAT), and retailing behemoth and Dow-30 component Wal-Mart Stores (WMTFree Wal-Mart Stock Report).

Finally, the markets are again pausing this morning, with the European bourses largely in the red, but just nominally so. However, our futures, after a brief dip earlier this morning, are now pointing slightly higher, presaging a little bit of a bounce when trading resumes in less than an hour from now. – Harvey S. Katz

At the time of this article's writing, the author had positions in CSCO.