Market ends lower for 2nd time in 3 weeks
But Apple retakes $600 after earnings and guidance disappoint investors. Amazon shares jump despite a quarterly loss. GDP rises at a 2% annual rate, but consumer optimism slips even as Americans spend more. Gasoline prices continue to drop.
By Charley Blaine Oct 26, 2012 1:03PM
Updated: 7:24 p.m. ET Stocks ended the day little changed, but the major averages finished lower for the second week in the last three.
The market gained strength from technology stocks, which rebounded from early-afternoon lows. Apple (AAPL) was the poster child for the rebound, falling below $600 for the first time since July 30 and climbing from a $591 low to a close of $604, a loss of $5.54. The company's fiscal-fourth-quarter earnings missed Street estimates and its guidance was also lower than expected.
Investors also bid shares of Amazon.com (AMZN) up $15.32 to $238.24 despite the company's loss for its third quarter. Investors are buying into the company's assurances that huge investments now will pay off later.
Financial stocks slipped as investors worried about economic conditions in Europe --Spain's unemployment rate hit 25% -- and the fiscal-cliff impact in the United States. There was some decent news: a better-than-expected third-quarter gain in gross domestic product, the key indicator of economic growth. GDP growth was an annualized 2%, the Commerce Department said, fueled by gains in consumer spending and housing investment.
The Dow Jones industrials ($INDU) closed up 4 points at 13,107. The blue chips had been down as many as 64 points. The Standard & Poor's 500 Index ($INX) ended down 1 point to 1,412, but the Nasdaq Composite Index ($COMPX) was up 2 points to 2,988.
Article continues below.The Nasdaq-100 Index ($NDX) added 8 points to 2,666. The catalysts included Apple's recovery and Amazon's big gain as well as a big jump in earnings for online travel site Expedia (EXPE). The shares jumped $7.81 to $59.06.
Apple represents about 17% of the market capitalization of the index. Amazon also has a smaller but noticeable influence on the index.
The Dow ended the week down 1.8%. The S&P 500 was down 1.5%, while the Nasdaq fell 0.6%. A loss for October seems likely after four straight monthly gains and monthly losses only in May and June this year. The Dow is down 2.5% for the month, with the S&P 500 down 2% and the Nasdaq off 4.1%.
Despite the declines, the Dow is up 7.3% for the year, while the S&P 500 has gained 12.3%. The Nasdaq is up 14.7%.
| Markets for the week | ||||||||||||
| 10/26/2012 | 10/19/2012 | % chg. | YTD chg. | |||||||||
| Dow Industrials | 13,107.21 | 13,343.51 | -1.77% | 7.28% | ||||||||
| S&P 500 | 1,411.94 | 1,433.19 | -1.48% | 12.27% | ||||||||
| Nasdaq | 2,987.95 | 3,005.62 | -0.59% | 14.69% | ||||||||
| Russell 2000 | 813.01 | 821.00 | -0.97% | 9.73% | ||||||||
| Crude oil | $86.28 | $90.44 | -4.60% | -12.70% | ||||||||
| (per barrel) | 0.00 | 0.00 | 0.00% | 0.00% | ||||||||
| U.S. Dollar Index | 80.16 | 79.69 | 0.59% | -0.45% | ||||||||
| 10-yr. Treasury | 1.75% | 1.77% | -1.02% | -6.47% | ||||||||
| Gold | $1,711.90 | 1,724.00 | -0.70% | 9.26% | ||||||||
About that GDP growth
U.S. economic growth picked up in the third quarter as a late burst in consumer spending and a surprise turnaround in government outlays offset the first drop in business investment in more than a year.
The stronger pace of expansion, however, fell short of what is needed to make much of a dent in unemployment, and it offers little cheer for the White House ahead of the closely contested Nov. 6 election.
The 2% GDP gain was an improvement over the second quarter's 1.3% pace. A rate in excess of 2.5% is needed over several quarters to make substantial headway in cutting the jobless rate.
The report was a bit better than economists had expected, in part because of a surge in government defense spending that was not expected to last. That combined with the faster pace of household spending and a jump in homebuilding to strengthen domestic demand.
Meanwhile, the Thomson-Reuters/University of Michigan consumer sentiment index dropped from a preliminary reading given earlier this month. Most economists had expected the index to remain unchanged.
| Energy prices -- New York close | ||||||||||||
| Fri. | Thur. | Month chg. | YTD chg. | |||||||||
| Crude oil (-CL) | $86.28 | $86.05 | -6.41% | -12.70% | ||||||||
| (per barrel) | ||||||||||||
| Heating oil (-HO) | $3.0764 | $3.0452 | -2.62% | 5.57% | ||||||||
| (per gallon) | ||||||||||||
| Natural gas (-NG) | $3.7240 | $3.7810 | 12.17% | 24.59% | ||||||||
| (per mil. BTU) | ||||||||||||
| Unleaded gasoline (-RB) | $2.6417 | $2.6323 | -9.53% | -0.59% | ||||||||
| (per gallon) | ||||||||||||
| Brent crude | $109.55 | $108.49 | -0.54% | 2.02% | ||||||||
| (per barrel) | ||||||||||||
| Retail gasoline | $3.5750 | $3.5990 | -5.60% | 9.13% | ||||||||
| (per gallon; AAA) | ||||||||||||
Crude oil rebounds; gasoline moves lower
Light sweet crude oil (-CL) in New York settled up 23 cents to $86.28 a barrel after being down for much of the day. Brent crude settled up $1.06 to $109.55 barrel. The gains may be due to worries that Hurricane Sandy will disrupt refinery operations in the Northeast next week.
For the week, light sweet crude was down 4.6%. Brent was down 0.5%.
The retail price of gasoline was $3.575 a gallon, down from Thursday's $3.599, according to AAA's Daily Fuel Gauge Report. The price is down 3.8% for the week and 5.6% for the month, although up 9.3% for the year. AAA's national average peaked this year, however, at $3.936 on April 6, which represented a 20.2% increase on the year.
Gold (-GC) gave up early gains and settled down $1.10 to $1,711.90 an ounce. For the week, gold was off 0.7%. Silver (-SI) and copper (-HG) were lower as well.
The 10-year Treasury yield fell to 1.75% from Thursday's 1.828%. The dollar was higher against major currencies.
Citigroup shares slide on news hits
Citigroup (C) shares fell 81 cents to $36.60 after technology analyst Mark Mahaney was reportedly fired because he improperly disclosed revenue estimates on Google's (GOOG) YouTube business. At the same time, Citigroup agreed to a $2 million fine imposed by Massachusetts regulators after a junior analyst emailed two employees at a technology website seeking feedback on a Facebook (FB) document containing a senior analyst’s views and estimates.
At the same time, The New York Times reported that Vikram Pandit's departure as CEO on Oct. 15 was hardly his choice. Instead, he was offered the choice of resigning immediately or at the end of the year. Or being fired immediately.
The coup was orchestrated by Chairman Michael O'Neill, who became increasingly convinced Pandit, who wasn't a banker by training, was the wrong person for the job. Probably what tipped the issue was in March when the Federal Reserve denied Citigroup permission to raise its dividend.
Merck shares slip; Moody's jumps
Shares of pharmaceutical giant Merck (MRK) were off 15 cents to $46.15. The company said its third-quarter profit rose 2% to $1.76 billion, or 56 cents a share, from $1.72 billion, or 55 cents a share, in the year-ago quarter. Adjusted profit edged up to 95 cents a share from 94 cents. Sales fell 4% to $11.5 billion from $12 billion. But the strong dollar depressed non-U.S.results. Excluding the currency effect, sales were comparable to year-ago levels.
Goodyear Tire & Rubber (GT) slumped by $1.28 to $11.02 after the company said weak demand in Europe held earnings back. Dealers on the continent are still working through excess winter tire inventory from last year..
Cable-and-broadcast operator Comcast (CMCSA) added $1.20 to $37.56. The majority owner of NBC said third-quarter profit more than doubled, boosted by advertising revenue, the sale of assets and a decrease in the loss of subscribers.
Moody's (MCO) added $2.17 to $47.89 after saying profit increased by 41% as companies took advantage of record investor demand and low borrowing costs by issuing debt.
Software developer CA (CA) fell $2.17 to $22.73. The company said it sees a 1% to 3% decline in full-year growth after it adjusted for currency fluctuations, down from a prior estimate of 1% to 2% growth. CA cited a 14% decline in second-quarter bookings due to lower sales in its enterprise solutions unit and lower mainframe capacity revenue.
Deckers Outdoor (DECK) tumbled $6.01 to $29.48 after cutting its forecast for annual sales growth by almost two-thirds amid declining demand for its UGG sheepskin boots.
| Short hits from the markets -- New York close | ||||||||||||
| Fri. | Thur. | Month chg. | YTD chg. | |||||||||
| Treasury yields | ||||||||||||
| 13-week Treasury bill | 0.1100% | 0.110% | 22.22% | 1000.00% | ||||||||
| 5-year Treasury note | 0.761% | 0.819% | 20.79% | -8.31% | ||||||||
| 10-year Treasury note | 1.750% | 1.828% | 6.90% | -6.47% | ||||||||
| 30-year Treasury bond | 2.918% | 2.981% | -3.76% | 1.00% | ||||||||
| Currencies | ||||||||||||
| U.S. Dollar Index | 80.156 | 80.118 | 0.16% | -0.45% | ||||||||
| British pound | 1.6098 | 1.6126 | -0.39% | 3.61% | ||||||||
| (in U.S. $) | ||||||||||||
| U.S. $ in pounds | £0.621 | £0.620 | 0.39% | -3.48% | ||||||||
| Euro in dollars | $1.29 | $1.29 | 0.66% | -0.14% | ||||||||
| (in U.S. $) | ||||||||||||
| U.S. $ in euros | € 0.773 | € 0.772 | -0.66% | 0.14% | ||||||||
| U.S. $ in yen | 79.74 | 80.35 | 2.28% | 3.43% | ||||||||
| U.S. $ in Chinese | 6.28 | 6.24 | 0.00% | -0.70% | ||||||||
| yuan | ||||||||||||
| Canada dollar | $1.002 | $1.006 | -1.40% | 2.18% | ||||||||
| (in U.S. $) | ||||||||||||
| U.S. dollar | $0.998 | $0.994 | 1.50% | -2.14% | ||||||||
| (in Canadian $) | ||||||||||||
| Commodities | ||||||||||||
| Gold (-GC) | $1,711.90 | $1,713.000 | -3.50% | 9.26% | ||||||||
| (per troy ounce) | ||||||||||||
| Copper (-HG) | $3.550 | $3.5505 | -5.53% | 3.32% | ||||||||
| (per pound) | ||||||||||||
| Silver (-SI) | $32.036 | $32.078 | -7.35% | 14.76% | ||||||||
| (per troy ounce) | ||||||||||||
| Wheat (-ZW) | $8.6375 | $8.7275 | -4.29% | 32.32% | ||||||||
| (per bushel) | ||||||||||||
| Corn (-ZC) | $7.3775 | $7.420 | -2.45% | 14.11% | ||||||||
| (per bushel) | ||||||||||||
| Cotton | $0.7242 | $0.727 | 2.51% | -21.01% | ||||||||
| (per pound) | ||||||||||||
| Coffee | $1.5775 | $1.610 | -9.08% | -31.31% | ||||||||
| (per pound) | ||||||||||||
| Crude oil (-CL) | $86.28 | $86.050 | -6.41% | -12.70% | ||||||||
| (per barrel) | ||||||||||||
513Comments
Oct 26, 2012 10:53PM
Oct 26, 2012 10:52PM
Oct 26, 2012 10:50PM
Oct 26, 2012 10:49PM
From Fact Check.org
Don’t get spun by Internet rumors
Just because you read it on somebody’s blog or in an email from a friend or relative doesn’t mean it’s true. It’s probably not, as we advised in our special report “Is this chain e-mail true?”
Borgman, Your post comes from Republican sources who spin the truth........
Oct 26, 2012 10:37PM
Maybe that story wasn't finished, but there is a whole lotta truth to the facts.....Of a whole lot of whiteys wanting that black man out of office....
They just can't, and won't admit it...
Kind of believe that they were stunned, that he was elected; And they have been griitting their teeth ever since..
My surprise was that this Nation elected a black man President, before a women was elected President.
Women the largest downtrodden minority(not) in the U.S. or the World..
Oct 26, 2012 10:15PM
Oct 26, 2012 10:13PM
Oct 26, 2012 10:10PM
Oct 26, 2012 9:17PM
Colonel Lawrence Wilkerson, a Republican who served as chief of staff to then-Secretary of State Colin Powell during the George W. Bush administration
DEFINES THE REPUBLICAN PARTY OF 2012
"My party, unfortunately, is the bastion of those people, not all of them but most of them, who are still basing their decisions on race. Let me just be candid: My party is full of racists. And the real reason a considerable portion of my party wants president Obama out of the White House has nothing to do with the content of his character, nothing to do with his competence as Commander-in-Chief, as President, and everything to do with the color of his skin. And that’s despicable".Oct 26, 2012 9:09PM
A Candid Republican Tells The Truth About Racism In His Party
Friday night on MSNBC, Colonel Lawrence Wilkerson, a Republican who served as chief of staff to then-Secretary of State Colin Powell during the George W. Bush administration, was asked to comment on Republican bully and Romney ****ter John Sununu’s race-based assertion that Powell endorsed President Obama because, well, “take a look at Colin Powell,” he said.Wilkerson, forcefully and without qualification, said this:
"My party, unfortunately, is the bastion of those people, not all of them but most of them, who are still basing their decisions on race. Let me just be candid: My party is full of racists. And the real reason a considerable portion of my party wants president Obama out of the White House has nothing to do with the content of his character, nothing to do with his competence as Commander-in-Chief, as President, and everything to do with the color of his skin. And that’s despicable".
All of you lurking conservatives out there who have followed this blog for the past three and a half years, who have indicted me, a Democrat, for what you claim are false accusations of racially-tinged resentment and false accusations of racism on the part of Republicans, can take it up with Colonel Wilkerson, one of your own.
http://duanegraham.wordpress.com/2012/10/26/a-candid-republican-tells-the-truth-about-racism-in-his-party/
Oct 26, 2012 8:56PM
Here is a Myth Robme surrogate talking for the Robme Campaign......More Myth Robme RACIST supporters in Action.....Myth Robme will do anything to WIN.....
This is Red Meat to reach the Crazy's, ABS's, Comrads, Jeff R's, Patriot 8208's and Mister Kyte's of this Country to get their Vote, the low IQ, low information, Racist's......That's why Fact's don't Matter with this wacko's
It’s too bad Sununu tried to knock an American war hero down a peg just to score cheap political points — and a shame that he sees this election in such petty terms.
Oct 26, 2012 8:35PM
Here is Myth Robme supporters in Action.......
Louisiana woman allegedly set on fire; hate crime investigated
http://now.msn.com/sharmeka-moffitt-set-on-fire-in-louisiana
A horrific attack in Louisiana has left a 20-year-old woman in critical condition after she was allegedly set on fire by three men wearing white hoodies. Sharmeka Moffitt suffered third-degree burns on 60 percent of her body; she'll undergo surgery tomorrow. The attack has rocketed across the Internet since it occurred on Sunday night, particularly because it was rumored that Moffitt's Obama T-shirt may have provoked the assailants. Moffitt was not, however, wearing the shirt when attacked. Police in Winnsboro, La., have confirmed that "KKK" was spray-painted on the hood of her car, along with a racial slur — and the FBI is investigating whether the attack should be classified as a hate crime.
Oct 26, 2012 8:29PM
Perfect V shaped recovery in AAPL today looks suspicious to me. Markets are more manipulated than ever. Wouldn't it be funny if it was the Goverment doing the maniulating? What do you think Ben Bernanke?
Next week do something more interesting. Make the chart look like a ship or a bird. I know, make it a black swan.
Oct 26, 2012 7:58PM
Oct 26, 2012 7:57PM
Along those lines, here is an excerpt from Yahoo biz news.
"On the same day that the CEOs of more than 80 major U.S. corporations pushed for a federal-deficit-reduction plan that would rely on lower tax rates but a "broader base," a poll revealed that a majority of small business owners believe that those CEOs should pay higher taxes.
The urging Congress to immediately pursue gradual "pro-growth tax reform." Their petitioned for a comprehensive plan that, among other measures, "broadens the base, lowers rates, raises revenues and reduces the deficit." The CEOs pointed to the recommendations of the bipartisan , which calls for a combination of budget cuts and increased tax revenue, as an "effective framework for such a plan."
-------------------------------------------------------------------------------------------------------------------------------------
See that, folks? Small business is realizing that its the Mega Corps working against them, not the little people. Even they are beginning to understand the importance of having a balance budget attended to by correcting both sides of the ledgers.
Right wingers, Get Familiar!
O B A M A ************** B I D E N ************** 2 0 1 2
Oct 26, 2012 7:56PM
Oct 26, 2012 7:51PM
Oct 26, 2012 7:48PM
More Bad News for Myth.......Bye, Bye, Myth Robme.......!!!!
GDP Increases 2%Today’s report shows that the economy posted its 13th straight quarter of positive growth, as real GDP (the total amount of goods and services produced in the country) grew at a 2 percent annual rate in the third quarter of this year, according to the “advance” estimate released by the Bureau of Economic Analysis. Over the past 13 quarters, the economy has expanded by 7.2 percent overall, and the private components of GDP have grown by 10.1 percent. While we have more work to do, together with other economic indicators, this report provides further evidence that the economy is moving in the right direction.
Consumer spending, which accounts for two-thirds of the economy, rose at a seasonally adjusted annual rate of 2 percent, compared with 1.5 percent in the second quarter. This is linked in part to the recovery in housing — people feel wealthier as the value of their homes increases. The refinancing surge also put more money in people’s pockets.
Housing sector, quite a change from not that long ago, when this was a major drag on GDP. Residential investment increased at an annual rate of 14.4 percent in the third quarter, versus 8.5 percent in the second quarter.
Oct 26, 2012 7:44PM
Gas prices dropping fast
In the last 30 days QT’s retail has dropped 65 cents,” said Thornbrugh. “In my opinion, it is the most dramatic 30 day downward spiral that I have seen that had nothing to do with hurricanes etc., just pure wholesale costs just plummeting.” Gas has dropped below 3.00 and another 30 cent drop expected before Nov 6th..More bad News for Myth Robme....!!!!! See ya Myth......Bye, Bye !!!!!
Oct 26, 2012 7:38PM
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