After The Close - Trading activity was somewhat muted on Wall Street today, reflecting the Federal holiday marking Veteran’s Day and the general lack of market-moving economic news. (U.S. bond markets were closed for the day.) Stocks started out slightly below Friday’s close, then generally settled into a modestly positive trading range where they remained for most of the session. When all was said and done, the Dow Jones Industrial Average, S&P 500, and NASDAQ covered very little ground, but all ended the day fractionally to the up side.

Across the pond, the European bourses carved out a similar pattern, but with somewhat more enthusiasm. France’s CAC-40 closed out the day with a 0.7% advance, while London’s FTSE and Germany’s DAX were up by about a third of percentage point each.  The gain’s likely reflected positive news over the weekend on China’s industrial production numbers (up 10.3% in October). That was partially offset by the residual effects from Friday’s favorable jobs report from the U.S., which raised concerns that the U.S. Federal Reserve would be encouraged to taper its bond-buying program a little earlier than expected.

As it turned out, Asia’s major exchanges posted the best performance on the day, with Japan’s NIKKEI up 1.3% while China’s Hang Seng advanced 1.4%, the latter likely bolstered by the aforementioned positive news on that nation’s manufacturing front.

Looking ahead, Wall Street will likely shrug off its sleepy start to the week as the economic calendar heats up. Notably, Thursday brings us reports on the trade balance for September as well as Initial Jobless claims, followed on Friday with the latest figures for capacity utilization and industrial production. -Mario Ferro 


12:30 PM EST - The U.S. stock market put in a somewhat mixed session this morning, but has since firmed up modestly. As we pass the noon hour in New York, the Dow Jones Industrial Average is ahead 22 points; the broader S&P 500 Index is up a point; and the technology-heavy NASDAQ, which had been lagging, is also flirting with breakeven positive territory. Market breadth still shows a lack of clear direction, as advancers are about even with decliners on the NYSE and the NASDAQ. The major market sectors are quite divided, with no groups sharply standing out. The basic materials stocks are trading lower, and the technology issues are also off a bit, too. However, some consumer cyclical names are advancing, and the financials are holding up well.

Technically, the S&P 500 Index has been quite volatile lately, posting some large one-day moves. Moreover, trading volumes have been elevated lately, further adding to the volatility. For now, the broad index is back near its high and also approaching the upper part of a trading range that has formed over the past several sessions. With third-quarter earnings season, which generally went well, now coming to a close, and the holiday period about to start up, traders may be taking a breather and repositioning their portfolios. Meanwhile, sentiment is stable, as the VIX is a bit lower to 12.67.

Meantime, traders here in the United States received no important economic reports this morning. This can lead to directionless trading, and cause investors to sit on the sidelines. It should be noted that while it is not a stock market holiday, today is Veteran’s Day, and that may be keeping things quiet. There are also few reports slated to be released tomorrow, but things will pick up a bit later in the week.

Finally, there were a few corporate news items issued today. In the medical arena, ViroPharma (VPHM) stock is trading sharply higher, after that company agreed to be purchased by Shire (SHPG). Also, Transocean Offshore (RIG) stock, which is held by activist investor Carl Icahn, is now trading modestly higher after the company agreed to raise its dividend. - Adam Rosner 

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


Stocks to Watch from The SurveyThe earnings calendar is rather light today, although it is scheduled to pick up a bit after the market closes. Still, investors have some reports to go over this morning, and the big winner appears to be Arkansas Best (ABFS). Indeed, the stock is up sharply ahead of the bell, after the trucking company reported third-quarter results that pleased investors. September-period results from precious metals company Silver Wheaton (SLW) were not met with the same enthusiasm, however, and that stock is down slightly in pre-market trading. Elsewhere, on the M&A front, shares of Novartis (NVS) are indicating a modestly higher opening this morning, after the drugmaker agreed to sell its blood-transfusion diagnostics business for about $1.7 billion. – Matthew E. Spencer

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

Before The Bell - When is good news for the economy also good news for the stock market? Well, at least, this past Friday that was the case, as a materially better-than-expected report on October non-farm payrolls led to a strong comeback rally on Wall Street. Of course, one would expect such a logical and orderly sequence to prevail. However, most of the time it has not--especially this year.

That is because good news on the business front, such as better-than-forecast levels of industrial output, gross domestic product growth, manufacturing activity, the leading indicators, retail sales, or, as we saw on Friday, employment growth can generate fears that the Federal Reserve will use such improving metrics as an excuse to lessen its monetary accommodation by reducing assets purchases or lifting short-term interest rates.

In fact, when the U.S. Department of Labor announced on 8:30 AM (EST) Friday morning that the nation had added a solid 204,000 non-farm payrolls last month, the equity futures, which had been poised to start the day nicely to the upside on the expectation that the nation would have added a modest 120,000 payrolls, reversed course and pointed lower for a few minutes. The rationale for this pullback in the futures, of course, was the fear that the strong jobs gain would encourage the Fed to start its long-anticipated monetary tapering sooner rather than later. However, when the bears could not get any footing underneath them, and no panic selling developed, an early modest setback in the market ebbed and stocks soon headed higher--a lot higher.

Interestingly, it seemed that instead of focusing on the Fed, some market participants apparently looked ahead to the possibilities of what a faster-growing economy could mean for Wall Street--namely an improving rate of earnings growth in the coming quarters. The day's upbeat action, meantime, ran counter to recent trends, when bad news was often welcomed and favorable tidings served to send stocks reeling--as had happened just one day earlier. Then, a much better GDP result for the third quarter (growth of 2.8%) helped unleash a torrent of selling. On Friday, however, stocks roared ahead early and never looked back, with the equity averages regaining most of the ground lost the prior day. And in some cases, such as the Dow Jones Industrial Average, gaining more than they had lost the previous session.

Also helping the market was the belief that even if economic momentum picks up and the Fed opts to begin a preventive tightening earlier than expected, the persisting low rate of inflation probably would keep any such upward move modest. Still, even the hint of a somewhat tighter monetary policy was enough to raise long-term interest rates rather sizably on Friday. To wit, the yield on the benchmark 10-year Treasury note jumped to 2.75%. Just days before, that rate had fallen below 2.50%. Now, it is climbing back toward the year's high of 2.98%. Expectations are that such rates will rise into the 3%-4% range over the next couple of years.    

Meanwhile, the day's upward action was broad based, with some of the prior day's casualties leading the advance. All told, by the end of the day, the Dow had jumped by 168 points; the Standard and Poor's 500 Index had gained 23 points; and the tech-laden NASDAQ, a 75-point loser on Thursday, had regained 62 points of that drop. It has been that kind of a year and that sort of a bull market.

Now, looking ahead to a new week, we see that the major averages across the globe are heading higher, albeit modestly, so, while our futures, which had been trending a bit lower a couple of hours ago, are now pointing to a modest early extension of the Friday rally. In fact, with the Dow and the Standard and Poor's 500 Index knocking on the door of all-time highs as trading commences, the path to least resistance would seem to be higher still, in spite of obvious frothy valuations. – Harvey S. Katz 

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