Stocks struggle as Europe, China worry investors

The Dow sees a 25-point gain fade to a 10-point loss as IBM and American Express are weak. Cisco jumps on an upgrade. US jobless claims dip, but growth in Europe and China is slowing. Nordstrom earnings cheer; Elizabeth Arden hits an all-time high.

By Charley Blaine Aug 9, 2012 12:36PM
Charley BlaineUpdated: 9 p.m. ET

Stocks ended the day flat after giving up most of their early advances as a bout of profit-taking and worries about China and Europe offset a decent report on U.S. jobless claims.

The global worries pushed the dollar higher against major currencies, especially the euro and the British pound, and that, as usual, has weighed on stocks of big multinational companies. American Express (AXP), IBM (IBM) and and United Technologies (UTX) were the weak links in the Dow Jones Industrial Average ($INDU), which closed down slightly after four straight gains.

The one multinational that wasn't feeling the dollar pain was Cisco Systems (CSCO), up 54 cents to $17.70. The networking company was the top performer among the 30 Dow stocks and fourth-best among Nasdaq-100 ($NDX) stocks after an upgrade from Piper Jaffray and inclusion in Goldman Sachs' "conviction buy" list.

Shares of upscale department-store operator Nordstrom (JWN) were up 92 cents to $56 after hours as earnings cheered investors. The stock had slipped 37 cents to $55.08 in regular trading.

The Dow finished down 10 points to 13,165. The Standard & Poor's 500 Index ($INX) gained a touch less than 1 point to 1,403, its fifth straight gain and longest winning streak since early June. The Nasdaq Composite Index ($COMPX) was up 7 points to 3,019.

Article continues below.
The Nasdaq-100 Index ($NDX) gained 6 points to 2,720. Apple (AAPL), the biggest influence on the index, was up $3.52 to $620.73.

Crude oil (-CL) opened above $94 a barrel but fell back to $93.36, a 1-cent gain, as the dollar moved higher. Gold (-GC) finished up $4.20 to $1,620.20 an ounce.

While the Dow itself moved lower, it was a split day. Fifteen of the 30 stocks in the index were higher, led by Cisco. But their gains were small. The losses for American Express, IBM and United Technologies alone subtracted nearly 15 points from the blue-chip index.

The market has traded in a narrow range so far this week but still looks to end higher for the fifth straight week. Moreover, August has started on a positive note, with the Dow up 1.2%, the S&P 500 up 1.7% and the Nasdaq 2.6%.

The gains have come as U.S. economic data for the last few week have not been as dour as in May and June. Moreover, the news from Europe, a source of near-panic in markets in May, has been quiet. Perhaps it's because many people are following the Olympics. But it's also true that many politicians and business leaders in Europe and the United States are on vacation.

Coming Friday: The July report on import and export prices and the monthly Treasury statement. Harman International (HAR), J.C. Penney (JCP) and Bank of Ireland (GB:BKIR) are the key earnings.

Futures trading suggests a modestly lower open for stocks.

Nordstrom has a solid quarter
The company earned 74 cents a share in the fiscal second quarter, beating the consensus estimate by a penny. Revenue was up 7.4% from a year ago to $2.92 billion, though it missed estimates by $100 million.

It also boosted guidance for the year, with same-store sales expected to be up 6% to 7% and earnings up $3.40 to $3.50 a share, up from 2011's $3.18.

For the fiscal third quarter it sees a "high-single-digit increase" from a year ago's $2.38 billion and a "mid-single-digit" increase for the fourth quarter.

The results were skewed slightly by the timing of Nordstrom's anniversary sale, the largest of the year. One week of the two-week sale came at the start of the third quarter. So, third-quarter results should be stronger than usual.

Same-stores sales at its full-service department stores were up 1.1%. But sales rose 7.7% at the discounted Rack stores. The concept is working well enough that Nordstrom is accelerating expansion of that business from 110 now to 230 Rack stores by the end of 2016.

Elizabeth Arden soars
Elizabeth Arden
(RDEN) shares jumped $5.06 to $44.02 after reaching an all-time high of $47.50. The company reported better-than-expected fourth-quarter results and gave strong guidance for its first quarter.

The company, which makes namesake perfume and celebrity perfume for people like Britney Spears and Justin Bieber, cited strong international sales and the expansion of its perfume business, particularly in Europe.

Because of one-time charges for license fees and other costs, net income was off 33% to $3.6 million, or 12 cents per share, from $5.4 million, or 18 cents per share, last year. Excluding those items, the company earned 28 cents per share, much better than the 20 cents expected on Wall Street.

Revenue was up 5% to $265 million from a year ago, a bit more than Street estimates.

Energy prices -- New York close



Thur.

Wed.

Month chg.

YTD chg.
Crude oil (-CL)

$93.36

$93.35

9.89%

-5.53%
(per barrel)











Heating oil (-HO)

$3.0450

$3.0159

12.37%

4.49%
(per gallon)











Natural gas (-NG)

$2.9450

$2.9330

4.28%

-1.47%
(per mil. BTU)











Unleaded gasoline (-RB)

$3.0008

$2.9804

8.16%

12.92%
(per gallon)











Brent crude 

$113.22

$112.14

7.91%

5.44%
(per barrel)











Retail gasoline

$3.6620

$3.6470

9.74%

11.78%
(per gallon; AAA)












Some good signs for the economy
Coming into today, the Dow and S&P 500 had risen for four straight days, in part because U.S. economic data were showing some improvement. There were a few more signs of improvement today.

The Labor Department said jobless claims unexpectedly dropped to 361,000 in the week ended Aug. 4. Economists had predicted an increase to 370,000. At the same time, the Commerce Department said the nation's trade deficit fell in June, thanks mostly to falling oil prices.

Europe became a worry in part because the optimism of a long-term solution to the continental debt crisis is fading. That has more to do with the realization that getting a solution in place will take gobs of time.

At the same time, the eurozone’s economy will shrink 0.3%  this year, according to a European Central Bank survey of professional forecasters. The previous forecast called for a 0.2% contraction.

Chinese economic data kept alive talk that central banks will intervene to support the global economy. Annual growth in factory output slowed to its weakest in more than three years in July while annual consumer price inflation hit a 30-month low.

Manchester United's IPO price is lower than expected
British soccer club Manchester United sold 16.6 million shares of common stock at $14 a share late today. The stock will start trading on the New York Stock Exchange on Friday with the ticker MANU as it tries to pay off more of the heavy debt piled on the club in its 2005 takeover.

The company raised $232.4 million in the IPO. The price was lower than the hoped for range of $16 and $20 a share. Had it been able to sell the shares at the $20 price, they might have raised around $330 million.

The 134-year-old club, with a record 19 English championships, is one of the most well-known teams on the planet, so the IPO was of great interest. But many analysts had cautioned that the debt-ridden team was overvalued and the offering was dependent on investors wearing their fan colors rather than their financial thinking caps.

Moreover, the offering will give investors little say in the company. The Glazer family of Florida will control the stock, and it offered limited financial disclosure as well.

E*Trade is looking for a new CEO; Monster Beverage slumps
E*Trade Financial (ETFC) rallied 55 cents to $8.57 as Chief Executive Officer Steven Freiberg was ousted from the company and its board is seeking a new leader.

But Monster Beverage (MNST) shares were off $6.57 to $61.20 after profit and sales missed analysts’ projections.

Robbins & Myers (RBN) shares rose $12.83 to $59.63. Oilfield-services equipment maker National Oilwell Varco (NOV) agreed to acquire the company for $2.55 billion, a deal that will expand the company’s offerings of tools, pumps and valves used in oil production.

Boingo Wireless
(WIFI) shares fell $2.23 to $6.77 after the company's fiscal-second-quarter results were slightly lower than analysts’ estimates. Its guidance for the third quarter was also below Street estimates. Boingo expects revenue of $25.5 million to $26.5 million for the quarter, with earnings of 5 to 6 cents a share. The Street consensus had been for revenue of $28.9 million and earnings of 8 cents. Boingo provides mobile internet service at some 500,000 Wi-Fi hotspots or locations around the world, often at airports.

Short hits from the markets -- New York close



Thur.

Wed.

Month chg.

YTD chg.
Treasury yields











13-week Treasury bill

0.1100%

0.110%

10.00%

1000.00%
5-year Treasury note 

0.728%

0.719%

21.54%

-12.29%
10-year Treasury note

1.688%

1.640%

1.75%

-9.78%
30-year Treasury bond

2.750%

2.740%

-0.47%

-4.81%
Currencies











U.S. Dollar Index

82.71

82.439

1.17%

2.72%
British pound

1.5640

1.5664

-0.41%

0.66%
(in U.S. $)

 








U.S. $ in pounds

£0.639

£0.638

0.41%

-0.65%
Euro in dollars

$1.23

$1.24

-2.57%

-5.08%
(in U.S. $)

 








U.S. $ in euros

€ 0.813

€ 0.809

2.64%

5.35%
U.S. $ in yen 

78.74

78.44

-1.26%

2.13%
U.S. $ in Chinese

6.38

6.36

0.17%

0.90%
yuan











Canada dollar

$1.009

$1.006

2.66%

2.80%
(in U.S. $)

 








U.S. dollar 

$0.992

$0.994

-2.58%

-2.73%
(in Canadian $)

 








Commodities

 

 

 

 
Gold (-GC)

$1,620.20

$1,616.00

1.00%

3.41%
(per troy ounce)

 








Copper (-HG)

$3.425

$3.422

-2.04%

-0.32%
(per pound)

 








Silver (-SI)

$28.0970

$28.0750

1.76%

0.65%
(per troy ounce)

 








Wheat (-ZW)

$9.1300

$8.9925

20.57%

39.87%
(per bushel)

 








Corn (-ZC)

$8.2375

$8.165

29.78%

27.42%
(per bushel)

 








Cotton 

$0.7595

0.76

6.48%

-17.16%
(per pound)

 








Coffee

$1.6955

1.732

-0.67%

-26.17%
(per pound)

 








Crude oil (-CL)

$93.36

$93.35

9.89%

-5.53%
(per barrel)










 

315Comments
Aug 9, 2012 1:55PM
avatar
The democraps are more worried about how Romney spends his money than how congress and Prez spends ours. 
Aug 9, 2012 2:18PM
avatar
NO AMERICA IS STRUGGLING!! hey msn, yea talkin' to u leftist idiots, when am I going to see you do a story on gas prices, cuz THEY'RE UP 30 CENTS A GALLON SINCE LAST MONTH!!!!! UNEMPLOYMENT SOARED UP!!! ZERO JOBS CREATED, NOT 163K FALSLY CLAIMED BY THE REGIME! the economy has remained stagnant at 1% growth in 3 FREAKIN' years!!! now, you guys wanna espouse all the good your faked messiah has done these past nightmarish years?? hmm?? oh right, YOU CAN'T!  meanwhile back at the insane white house, the disgraced white house of course, osama is gutting welfare work requirments!! so get in line America, especially you parasitic blightes on America, here's your handouts thanks to the osama regime, while John Q. Public foots the bill, again!! and you may as well forget getting work with everyone in a holding pattern as far as hiring goes, tell me again how osama's gonna get re elected again? cuz I luv to laugh at that, BIG TIME!!
Aug 9, 2012 1:59PM
avatar
In the last 2 weeks I've seen appx 4 different Obama campaign ads on TV. Not one them mentioned a word about why I should VOTE FOR Obama. Everyone was was geared toward how much Romney paid in taxes. Funny thing is, he paid way more than Barry the Kenyan paid.
Aug 9, 2012 3:19PM
avatar
When gas was $4 in 2007, it was because Bush was taking care of his oil buddies.

Now that gas is back at $4 it's all of a sudden NOT the Presidents problem. In fact, the lefty media tries to paint it as a sign of prosperity.

According to the libtards.
Aug 9, 2012 2:06PM
avatar
When will Obama talk about his record, and the good he has done for this Country!  Or can he!
Aug 9, 2012 2:03PM
avatar

OBAMA IS SURE LEADING US...................

 

BUT DOES ANYONE KNOW WHERE HE IS GOING????????????

Aug 9, 2012 2:22PM
avatar
Romney should release his tax returns when Obama releases his college transcripts. Aint gonna happen
Aug 9, 2012 1:08PM
avatar
OK people which one is it. Stocks rise on Europe hope, stocks struggle on Europe worries or stocks tumble on Europe worries. This just goes to show that stocks have become their own entity. They are not rising on real numbers but on whim and speculation.
Aug 9, 2012 1:59PM
avatar
Obama = Destruction of American!  Prove me differently!
Aug 9, 2012 1:38PM
avatar

Anyone knows the difference between Obama supporters and Romney supporters??????

 

Here is the answer:

OBAMA SUPPORTERS SIGN THEIR NAME ON THE BACK OF THE CHECK

ROMNEY SUPPORTERS SIGN THEIR NAME ON THE FRONT OF THE CHECK

 

Simple but true

Aug 9, 2012 2:35PM
avatar
Sounds like Endeavor is blaming Romney for today's economic problems, but yet he is not the president at this time.
Aug 9, 2012 1:50PM
avatar

"Can't believe you even get paid for your BS."

 

It is only fair since we have to pay Obama for his BS, and all the other elected politicians for that matter.

 

Aug 9, 2012 1:33PM
avatar

Got any Chick-O-Filet lately?

Here we go again as Reagan would say:

 

OBAMA BLAMES BUSH

THE STOCK MARKET BLAMES EUROPE, CHINA AND EVERYONE ELSE

 

Well Well Well, tell me when is it that America is responsible for what it does huh?

OR TELL WHEN IS IT THAT AMERICAN WILL STOP BLAMING OTHERS FOR THEIR DEMISE?

Aug 9, 2012 2:52PM
avatar
Gas back at $4 Per for Reg. LI NY
So I was just wondering when the price per barrel was at $70 couple of months ago then the reflected price that takes months to adjust down (cough,cough)B/S.
Then gas per gallon should be $2.75 for Reg. NO!?
Aug 9, 2012 1:03PM
avatar
Get a life with your reporting.  Flip Flop.  Your articles are nothing but propaganda BS.
Aug 9, 2012 1:49PM
avatar

The other day I said that someone, in Europe, would break wind and the economy would go down again.  Looks like that someone let a squeaker go by and now Wall Street starts to worry. 

Aug 9, 2012 2:14PM
avatar
Lost count , how many times has this headline been used?????  sounds like spam to me?
Aug 9, 2012 3:30PM
avatar
V-L  Wishes me to support the first black president, not on job performance but because he is black!  If he "Obama" was doing the Country good I would gladly support him in a heart beat, but he is destroying the USA and down with him. Whether black or white, the one doing the best for the American people I would vote for him.  Cain a true black would be a much better president.
Aug 9, 2012 1:03PM
avatar
Can't believe you even get paid for your BS.
Aug 9, 2012 3:02PM
avatar
Stop blaming China and Europe for our economy, its Obama and his destructive policies!
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