Oracle, Research In Motion cheer Street
Bullish results come after stocks struggle to end higher. Jobless claims are better, but a manufacturing report is weaker than expected. FedEx guidance disappoints. Gold moves higher.
Updated: 9:10 p.m. ET
For a third straight day, stocks opened lower and pushed slowly toward the black this afternoon as a little good news on jobs appeared to trump concerns about home foreclosures and too-slow economic growth.
But the market may jump on Friday. Investors were cheered by quarterly results from BlackBerry maker Research In Motion (RIMM) and database giant Oracle (ORCL). RIM shares were up 4.5% to $48.60 after hours; the shares were briefly up as much as 9%. Oracle was up 4.6% to $26.53 after hours.
The market seemed most worried by the Philadelphia Federal Reserve Bank's report that manufacturing in its district is flat, with orders and shipments declining. FedEx (FDX) shares tumbled after the company's guidance was less than hoped for.
The Dow Jones industrials ($INDU) closed up 22 points to 10,595. The Standard & Poor's 500 Index ($INX) was off very slightly at 1,125, while the Nasdaq Composite Index ($COMPX) was up 2 points to 2,303. It was the Nasdaq's 7th straight gain, its longest winning streak since early July.
Stocks seeing a lot of activity today included:
- Ford Motor (F), up 4.8% to $12.44. Barclays upgraded the shares to "overweight" from "equal-weight," saying cost-cutting and pricing have improved the automaker's earnings power.
- Abbott Laboratories (ABT), off 0.1% to $51.61. A U.S. panel was split on whether Abbott's diet pill Meridia -- linked to heart attacks, strokes and deaths -- should stay on the market.
- Pier 1 Imports (PIR), up 6.5% to $8.48. The import furniture retailer's fiscal-second-quarter sales and profits exceeded estimates.
- Williams Cos. (WMB), down 3.5% to $18.44. The natural-gas pipeline operator forecast earnings of as little as 85 cents a share in 2011 and as little as 95 cents in 2012. The Street has been expecting $1.47 in 2011 and $1.80 in 2012.
- Caseys General Stores (CASY), down 1.3% to $43.30. Canadian convenience-store operator Alimentation Couche-Tard (ANCUF) wants Caseys' shareholders to overturn management in a takeover fight.
The good news on the day came after the close with the better-than-expected results from Oracle and Research In Motion. They should combine for a strong open on Friday. Futures prices late today suggest a strong U.S. open.
In addition, Texas Instruments (TXN) shares should rise after the largest maker of semiconductors used in cell phones said it will buy back an additional $7.5 billion of its common stock and boost its quarterly dividend a penny, or 8%, to 13 cents.
The repurchase amount is in addition to the $1.3 billion in buyback authorizations remaining at the end of June. Shares were up 3.3% after hours to $25.80 after rising 1.3% to $24.98 in regular trading.
Meanwhile, Research In Motion, locked in a struggle with Apple (AAPL) and phone makers using Google's (GOOG) Android operating system, boosted its fiscal-third-quarter guidance substantially. Revenue will be $5.3 billion to $5.5 billion, with earnings at $1.62 to $1.70 a share. Analysts were projecting revenue of $4.84 billion and earnings of $1.39 a share.
The company earned $1.46 a share in the fiscal second quarter, up 76% from a year ago. Revenue was up 31% to $4.62 billion. Analysts had expected $1.36 a share in earnings and $4.48 billion in revenue. Net subscriber additions were 4.9 million, a bit less than expected.
The after-hours gain for RIM's shares came after a 2.1% gain to $46.49 in regular trading. The stock is up 7% in September but off 31.2% on the year.
The company believes its new Torch devices and the BlackBerry 6 operating system will power sales in the third and fourth quarters. It also believes that it will resolve internal security issues raised in the Middle East and in India.
Oracle, meanwhile, saw earnings jump 40% to 42 cents a share after one-time charges in the first fiscal quarter as revenue jumped 50% to $7.6 billion after one-time events. Analysts had expected earnings of 37 cents and revenue of $7.28 billion.
New software license revenue was up 25% from a year ago to $1.28 billion.
During the company's conference call with analysts, Safra Catz, one of Oracle's president, said the company expects revenue to jump 42% to 47% from a year earlier's $5.87 billion. That would mean $8.3 billion to $8.6 billion.
Mark Hurd, the former Hewlett-Packard CEO who joined Oracle, as a president, was briefly on the call.
While Oracle was rallying after hours, the shares had fallen 1.5% to $25.36 in regular trading.
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The market won't fall -- and won't climb
Today saw a recurrence of the market's recent pattern: opening lower and recovering in the last hour of trading.
The Dow was off 50 points 10 minutes after the open before starting to recover.
The market trend in the last few weeks has been higher. The Dow is up 5.8% since closing at 9,986 on Aug. 26, with the S&P 500 up 6.5% and the Nasdaq up 8.1%.
But the major indexes appear to be hitting resistance. The S&P 500 can't get much past 1,125, which is still lower than highs seen in June and August.
Gold settled up $5.90 to $1,273.80 an ounce, a new closing high. Crude oil settled down $1.45 to $74.57 an ounce as traders worried about a global supply glut.
Interest rates were up slightly, with the 10-year Treasury yield rising to 2.755% from 2.723% on Wednesday. The dollar was mixed against major currencies.
Eighteen of the 30 Dow stocks were higher, led by Hewlett-Packard (HPQ), up 1.8% to $40.35. Alcoa (AA) was the laggard, down 1.5% to $11.26.
Forty-two Nasdaq-100 ($NDX.X) stocks were higher, even if the index was up 6 points to 1945. Apple (AAPL), up 2.4% to $276.57, added 6 points to the index by itself.
Economy sends off many signals
This was a busy day with lots to think about. Here's what we mean:
The jobs picture: a bit better. Initial jobless claims fell to 450,000 in the week ended Sept. 11 from 453,000 the week before. The moving average dropped to 464,750. That's three straight weeks of declines.
Manufacturing: cloudy. The Philadelphia Fed issued a disappointing report on manufacturing activity in its district. It was flat. Orders and shipments were lower. Employment was steady but hours worked per week were down slightly. Employers see growth in the next six months but not as much as they'd sensed earlier in the year.
Foreclosures: difficult. Banks repossessed 95,364 properties last month, RealtyTrac said today. That's a 3% rise from July, a 25% rise from the year before, and the highest of any month since the financial crisis began. Homebuilders were the weakest group in the S&P 500.
FedEx's guidance is a problem
FedEx reported that fiscal-first-quarter earnings doubled to $380 million, or $1.20 a share. Earnings missed the Street estimate by a penny. It boosted its second-quarter earnings guidance to $1.22 to $1.55 a share. But the Street was looking for $1.32 to $1.35. Shares fell 3.8% to $82.72.
FedEx said its classic business was strong. Its land-based freight business was improving but still losing money. It's consolidating that business, resulting in 1,700 job cuts.
Shares of rival UPS (UPS) were off 1.4% to $66.72.
Material from The Street.com was included in this report.
|Short hits from the markets -- New York close|
|Thur.||Wed.||Month chg.||YTD chg.|
|13-week Treasury bill||0.150%||0.150%||11.11%||200.00%|
|5-year Treasury note||1.462%||1.443%||8.94%||-45.57%|
|10-year Treasury note||2.759%||2.723%||11.38%||-28.21%|
|30-year Treasury bond||3.923%||3.874%||11.04%||-15.47%|
|U.S. Dollar Index||81.501||81.751||-1.79%||4.19%|
|(in U.S. $)|
|U.S. $ in pounds||£0.6400||£0.6396||-1.75%||3.53%|
|Euro in dollars||$1.3082||$1.3017||3.18%||-8.73%|
|(in U.S. $)|
|U.S. $ in euros||€ 0.7644||€ 0.7682||-3.08%||9.56%|
|U.S. $ in yen||85.91||85.72||2.15%||-7.62%|
|(in U.S. $)|
|(in Canadian $)|
|(per troy ounce)|
|(per troy ounce)|
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