Dow up 85 as Cisco, housing give stocks a boost
Cisco Systems' earnings cheer tech investors. An IBM deal also excites the market. Building permits hit a 4-year high. Wal-Mart and Ross Stores results disappoint. Facebook hits a new low. Jobless claims are flat.
Updated: 6:20 p.m. ETStocks moved solidly higher today, and the major averages flirted with hitting new highs for the year as decent earnings from Cisco Systems (CSCO) boosted technology stocks and building permits hit a four-year high.
Cisco reported better-than-expected earnings late Wednesday and boosted its dividend. While business conditions in Europe overall are a mess, CEO John Chambers said, business in Asia and North America is reasonably strong. The report pushed shares up $1.67 to $19.02. Its percentage gain was the largest since Aug. 11, 2011.
Building permits hit a seasonally adjusted annual rate of 812,000 in July, the best level since August 2008. Permits were up 6.8% from June and 29.5% from July 2011. Housing starts were off slightly. Homebuilding shares were higher. So were shares of housing-related stocks, including Whirlpool (WHR), La-Z-Boy (LZB), Bed Bath & Beyond (BBBY) and Masco (MAS). Jobless claims of 366,000 this week were up slightly from a week ago.
Facebook (FB) shares did not participate in the rally. Instead, they briefly hit a new low of $19.69 before finishing at $19.87, down $1.33 on the day. Lock-up rules expired today, and some 271 million shares were eligible to be traded. Lock-up rules are put in place to prevent early investors from selling their positions as soon as a company goes public. Another 1.2 billion shares will get unlocked by next spring.
Profit-taking trimmed some of the rally's froth. The Dow Jones industrials ($INDU) closed up 85 points to 13,250, its best gain since jumping 217 points on Aug. 3. The blue chips had been up as many as 105 points. The Standard & Poor's 500 Index ($INX) gained 10 points to 1,416, and the Nasdaq Composite Index ($COMPX) rose 31 points to 3,062.
Article continues below. The Nasdaq-100 Index ($NDX) gained 33 points to 2,768.
Volume, however, was light. New York Stock Exchange volume is just 322 million shares. Average daily trading volume so far in August is the lowest since December 2007.
You can see the the volume decline in Apple (AAPL). Its five-day average volume as of Wednesday was 9.2 million shares, compared with nearly 35 million shares in late April and 26 million shares over the five trading days ended Aug. 15, 2011.
After the close, shares of Gap (GPS) were up 66 cents, or 1.9%, after the company reported a better-than-expected 29% gain in earnings. The company again raised its full-year earnings view to $1.95 to $2 a share from its May view of $1.78 to $1.83 a share.
Market could be up again for the week
With today's gains, the Dow is up 0.3% for the week, with the S&P 500 up 0.7% and the Nasdaq up 1.4%. If the gains hold, they would be the sixth straight for the Dow and S&P 500 and fifth straight for the Nasdaq.
Since the market bottom on June 4, the Dow is up 9.5% with the S&P 500 up 10.8% and the Nasdaq 11.5%.
The Dow is up 8.5% for the year, with the S&P 500 up 12.6% and the Nasdaq up 17.6%.
Foot Locker (FL) and J.M. Smucker (SJM) are the key earnings reports on Friday. The Conference Board releases its July report on leading economic indicators. The University of Michigan reports on consumer confidence.
Futures tradings suggests stocks will open modestly higher.
Apple signals interest in cable
Apple, the biggest influence on the Nasdaq-100, closed up $5.51 to $636.34 today, within $8 of its all-time intraday high of $644, set on April 10.
One reason for Apple's gain: The company is in talks with some of the biggest U.S. cable operators about letting consumers use an Apple device as a set-top box for live television and other content.
The talks represent Apple's most ambitious crack at infiltrating the living room after years of trying, The Wall Street Journal said.
| Energy prices -- New York close | ||||||||||||
| Thur. | Wed. | Month chg. | YTD chg. | |||||||||
| Crude oil (-CL) | $95.60 | $94.33 | 8.56% | -3.27% | ||||||||
| (per barrel) | ||||||||||||
| Heating oil (-HO) | $3.1229 | $3.0852 | 9.65% | 7.16% | ||||||||
| (per gallon) | ||||||||||||
| Natural gas (-NG) | $2.7240 | $2.7480 | -15.11% | -8.87% | ||||||||
| (per mil. BTU) | ||||||||||||
| Unleaded gasoline (-RB) | $3.0832 | $3.0840 | 11.13% | 16.02% | ||||||||
| (per gallon) | ||||||||||||
| Brent crude | $116.90 | $116.25 | 11.42% | 8.87% | ||||||||
| (per barrel) | ||||||||||||
| Retail gasoline | $3.7100 | $3.7090 | 6.00% | 13.25% | ||||||||
| (per gallon; AAA) | ||||||||||||
Cisco and IBM gains are 36% of Dow's total
Cisco's gain added nearly 13 points to the Dow. As it reported fiscal-fourth-quarter earnings late Wednesday, the network-equipment maker also unveiled a plan to raise its quarterly dividend by 75% to 14 cents a share.
And it vowed to use 50% of its free cash flow for dividends and to buy back shares. Cisco was the top percentage gainer among stocks in the Dow, the S&P 500 and the Nasdaq-100 indexes.
IBM (IBM) was up $2.44 to $200.84, its first close above $200 since May 11. The gain added roughly 18 points to the Dow.
IBM was up after announcing it was buying flash-memory provider Texas Memory Systems for an undisclosed sum, as the technology heavyweight looks to boost its storage offerings. Texas Memory, founded in 1978, makes what are called solid-state storage drives.
Unlike hard-disk drives that rely on spinning disks and robotic arms, solid-state systems are based on flash or random-access memory that can provide significantly faster access to data while consuming less power.
Sterne Agee said the deal is important for a number of reasons, including:
- The market for flash has become important enough that IBM wants its own intellectual property in the space.
- It may force a storage provider line EMC (EMC) to consider an acquisition of a player in flash memory such as Fusion-io (FIO). Fusion-io shares were up $2.15 to $28.41.
Wal-Mart Stores (WMT) was the big weight on the Dow, falling $2.30 to $72.15 as fiscal-second-quarter revenue of $113.5 billion was less than expected. Earnings of $1.19 were a penny better than estimates. The stock-price decline subtracted nearly 19 points from the Dow.
Earnings that also disappointed investors came from Ross Stores (ROST) and Dollar Tree (DLTR).
Ross said profits were up 23% from a year ago, and revenue was up 12% to $2.34 billion, but its guidance for the fiscal third quarter and the full years were lower than expected.
Dollar Tree reported 51 cents a share in earnings, a penny less than expected. Revenue was up 10.5% to $1.7 billion, but analysts had expected $1.77 billion. Shares fell 89 cents to $49.11 and were falling further after hours.
Game-maker Electronic Arts (EA) rose 72 cents to $13.81 on a New York Post report that the company's management was exploring selling the company. The Post said the company had been approached by private-equity giants KKR and Providence Equity Partners about a potential deal.
Twenty-three Dow stocks were higher, with Home Depot (HD) and Microsoft (MSFT) trailing Cisco. The laggards were Wal-Mart, McDonald's (MCD) and Merck (MRK).
After Cisco, Sears Holdings (SHLD) and PulteGroup (PHM) were the top S&P 500 performers. Agilent Technologies (A), drug-maker Perrigo (PRGO) and Sprint Nextel (S) were the laggards.
Agilent, which supplies bio-analytical and electronic measurement tools to the communications, electronics, life sciences and chemical analysis industries, reported disappointing fiscal-third quarter results, and cut estimates for the year.
Sears Holdings and Electronic Arts were the top Nasdaq-100 stocks after Cisco. Perrigo and and Gilead Sciences (GILD) were the laggards.
Crude oil tops $95 a barrel; gold moves higher
Light sweet crude oil (-CL) was in New York was up 97 cents to $95.30 a barrel. Brent crude, the benchmark North Sea oil, gained a penny to $116.24 a barrel.
Gold (-GC) settled up $12.60 to $1,619.20 an ounce. Silver (-SI) was up 40 cents to $28.212 an ounce. Copper (-HG) added 3.3 cents to $3.3825 a pound.
Interest rates were higher, with the 10-year Treasury yield reaching 1.836% from 1.805% on Wednesday. The dollar was lower against major currencies.
The 10-year yield is at its highest level since May 11 and is up nearly a quarter this month alone. One possible catalyst for the gain, at least according to CNBC's Rick Santell, is the vow of Mario Draghi, president of the European Central Bank, to do whatever it takes to save the euro. German Chancellor Angela Merkel, visiting Canada today, made a similar vow.
| Short hits from the markets -- New York close | ||||||||||||
| Thur. | Wed. | Month chg. | YTD chg. | |||||||||
| Treasury yields | ||||||||||||
| 13-week Treasury bill | 0.0800% | 0.090% | -20.00% | 700.00% | ||||||||
| 5-year Treasury note | 0.816% | 0.795% | 36.23% | -1.69% | ||||||||
| 10-year Treasury note | 1.836% | 1.805% | 23.06% | -1.87% | ||||||||
| 30-year Treasury bond | 2.956% | 2.914% | 14.71% | 2.32% | ||||||||
| Currencies | ||||||||||||
| U.S. Dollar Index | 82.417 | 82.711 | -0.35% | 2.35% | ||||||||
| British pound | 1.5746 | 1.5686 | 0.41% | 1.34% | ||||||||
| (in U.S. $) | ||||||||||||
| U.S. $ in pounds | £0.635 | £0.637 | -0.41% | -1.32% | ||||||||
| Euro in dollars | $1.24 | $1.23 | 0.53% | -4.56% | ||||||||
| (in U.S. $) | ||||||||||||
| U.S. $ in euros | € 0.809 | € 0.814 | -0.53% | 4.78% | ||||||||
| U.S. $ in yen | 79.43 | 78.98 | 1.67% | 3.02% | ||||||||
| U.S. $ in Chinese | 6.39 | 6.36 | 0.47% | 0.98% | ||||||||
| yuan | ||||||||||||
| Canada dollar | $1.014 | $1.011 | 1.74% | 3.40% | ||||||||
| (in U.S. $) | ||||||||||||
| U.S. dollar | $0.986 | $0.989 | -1.64% | -3.29% | ||||||||
| (in Canadian $) | ||||||||||||
| Commodities | ||||||||||||
| Gold (-GC) | $1,619.20 | $1,606.60 | 0.54% | 3.34% | ||||||||
| (per troy ounce) | ||||||||||||
| Copper (-HG) | $3.383 | $3.350 | -1.02% | -1.56% | ||||||||
| (per pound) | ||||||||||||
| Silver (-SI) | $28.2120 | $27.8120 | 1.07% | 1.06% | ||||||||
| (per troy ounce) | ||||||||||||
| Wheat (-ZW) | $8.8175 | $8.6625 | -0.73% | 35.08% | ||||||||
| (per bushel) | ||||||||||||
| Corn (-ZC) | $8.0750 | $8.040 | 0.28% | 24.90% | ||||||||
| (per bushel) | ||||||||||||
| Cotton | $0.7259 | 0.7311 | 1.75% | -20.82% | ||||||||
| (per pound) | ||||||||||||
| Coffee | $1.6180 | 1.6495 | -7.22% | -29.54% | ||||||||
| (per pound) | ||||||||||||
| Crude oil (-CL) | $95.60 | $94.33 | 8.56% | -3.27% | ||||||||
| (per barrel) | ||||||||||||
Mitt Romney and Paul Ryan are misrepresenting Obama's Medicare changes and lying about it.
Obamacare does cut $700 billion in Medicare spending over a 10-year period. But the cuts are adjustments in payments to Medicare providers, which are mostly meaningless to patients. According to the CBO, the ACA's 10-year cuts include $415 billion in fee-for-service payments to healthcare providers, $156 billion in reduced payments to Medicare Advantage plans, $56 billion to hospitals, and $114 billion in other miscellaneous cuts far too numerous to detail here.
Obama has been President during one of the most corrupt adverse anti-American business and finance GOP controlled economies in history. If that was ALL he had on his resume, he'd win by a landslide. You should check out the article on global business executive polling. They choose the President as well. It makes sense. A Democrat is likely to snap the ivory towers off at street level and promote new enterprises. Republicans who inherited millions and more and used it to make more millions by attempting world domination will be writing checks until their hands fall off. One has to always remember... the collective body of far right losers pales by comparison to all of the good and victimized people around the world. Nobody argues that there has been manipulation and control for adverse purposes, the argument is-- what to do with you now that you've screwed the whole world? I for one have no intentions of letting ONE tax dollar go towards supporting far right incarcerations. You will be working you way "up" but it's unlikely you will realize "freedom" in your lifetime, because you never intended it for the rest of us.
Close the banks. End the Fed. Get rid of Wall Street. Because these things are anti-American. If you aren't 100% invested in job recovery, you won't be here by the New Year.
Hey think....
WHY should voting be made easier?.....you dumb A$$.. Showing a picture of yourself to PROVE who you are is no burden or serious price to pay for the privilege to vote. The blood shed for that privilege was not spent to make it EASY! Every swing dick that's legally entitled to vote CAN VOTE with a little effort on their part to prove eligibility.
I'm DAMN proud to call myself a man who supports RESTRICTING those who DON'T quallify from the voter rolls.
"Just to be clear the Romney/Ryan budget will not balance the budget until 2040 at the earliest"
I heard the breakdown argument on Ryan's propsal on several channels, this point was confirmed on ALL of them. I also validate his uneven tax liability aspect. Ryan is very dangerous. He has no actual work experience outside politics, so he has never worked among us. When you are theorizing a plan that proposes balance in 28 years ahead, commonsense simply play's intelligent advocate and says what about [any of the thousands of variables we have seen over the last 28 years] and it turns his plan into a money pit we cannot remotely afford. Wall Street wants a 30,000 Dow and it wants it while they possess 100% of the stock shares purchased when it was 10,000. Ryan's plan helps us inflate but it doesn't create ANY consumer advantages at all. Romney and Ryan are already falling down in polls. What I'd like to see is both of them called on the carpet to explain themselves in specific detail. Romney made $100 million fleecing consumers and businesses as Bain Capital. He laundered money through offshore accounts. Basically, he's exactly what we DO NOT need right now. Ryan's insistence that his budget works is irresponsible because he can't be confident it survives the 28 years it proposes as duration. Who would vote for corruption?
"Time to replace cars with bicycles,"
It likely occurs to you as well... with municipalities hurting nationwide, why hasn't every city dedicated pedestrian lanes on their roads to slow pass-through traffic and provide alternative pedal traffic that is more likely to stop and shop, thus generating revenues. Highways weren't meant to speed through a community and no longer benefit them. If it were me, I'd reduce the Speed Limits to inconvenience any non-beneficial traffic, force trucks that do not support the community to go around it and concentrate on money-makers that bolster my commerce. I would also be forcing Law & Ordinance Reform that takes the confusion out of small business existence. Smart cities are communities that open their borders to fresh money with basic accommodation and rules anyone can grasp and adhere to.
Last month it was reported that the wealth of the average Canadian was greater than the wealth of the average American for the first time in history.
With our private sector constantly being burdened to feed the ever growing leviathan that is our government and to bow to it's rule. We will find ourselves being eclipsed in living standards and in personal wealth by one nation after another
In the not too distant future mothers in China will remind their children that there are children starving in America in the effort to get their children to eat their vegetables. Those starving children will be your grandchildren.
WAKE UP
To get rid of unwanted postings. just run your cursor down the right edge. The word for whawt you want to get rid of appears. Just click on it and the idiot's unwanted oisting is gone.
Sorry this is so oblique, I tried to post the word for the unwanted postings and I kept getting a message that my message similar to thst word. Go figure. they let some idiot post porno, posts about sleazy computert dating, etc. but they will not let me post telling you how to get rid of it.
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