Dow up 95 on retail sales, Citigroup results

Investors are cheered that September retail sales are stronger than expected. Apple's iPhone sales help. Citigroup's core business is getting stronger. Speculators bet Clearwire will be part of the Sprint-Softbank deal.

By Charley Blaine Oct 15, 2012 1:10PM
Charley BlaineUpdated: 5:50 p.m. ET

Stocks surged today with a solid and broad rally that saw the Dow Jones industrials ($INDU) enjoy their best day in a month.

The rally was built on a decent report on September retail sales, better-than-expected quarterly results from Citigroup (C) and, finally, Softbank's (SFTBY) deal to buy 70% of Sprint Nextel (S).

Adding some extra cheer to the market: Gains in health care stocks triggered in part by an Eli Lilly (LLY) report that a new gastric-cancer drug has produced good results and an analyst upgrade. In addition, inflation and trade data from China made investors more optimistic about the world's second-largest economy.

Manufacturing in New York contracted more than economists expected in September, according to the Federal Reserve Bank of New York's Empire State Manufacturing Survey.

The Dow closed up 95 points to 13,424; the blue chips had been up as many as 109 points just before the close. The Standard & Poor's 500 Index ($INX) gained 12 points to 1,440, and the Nasdaq Composite Index ($COMPX) rose 20 points to 3,064. The Dow's gain was its largest since a 207-point surge on Sept. 13. The gains for the S&P 500 and Nasdaq were their best since Sept. 27.

Article continues below.
The Nasdaq-100 Index ($NDX), which tracks the largest Nasdaq stocks, jumped 20 points to 2,740. Apple (AAPL), the biggest weight in the index, had a volatile day but was up $5.05 to $634.76.

After the close, shares of WD-40 (WDFC) were off $4.79 to $46.55 after hours as the company's fiscal-fourth-quarter earnings of 56 cents a share missed the Street estimate of 70 cents. Revenue was down 6% to $89.9 million.  It also cut guidance for its fiscal 2013 year.

Also lower after hours was financial information service Bankrate (RATE), whose shares fell more than 25% after hours to $10.85. The company announced preliminary third-quarter results with revenue expected at $115.5 million to $117.5 million. The consensus estmate was $132.7 million. The company projected earnings of 11 to 13 cents a share. The Street was looking for 20 cents.

Crude oil makes a comeback; gold slips
Crude oil (-CL) in New York recovered from early selling, settling down a penny to $91.85 a barrel. It briefly dropped below $90 a barrel in morning trading and was trading slightly lower in electronic markets.

Brent crude, the benchmark North Sea crude that's a key driver of U.S. retail gasoline prices, was up $1.13 to $115.73 a barrel.

The national average retail price for unleaded gasoline was $3.787 today, according to AAA's Daily Fuel Gauge Report. That's off from Sunday's $3.794 and down 3.1 cents from a near-term high of $3.818.

Gold (-GC) settled down $22.10 to $1,737.60 an ounce. Silver (-SI) was off 92.6 cents to $32.743 an ounce. Gold has shed 2.1% this month; silver is down 5.3%. Gold is still up 10.3% for the year; silver is up 17.3%.

Energy prices -- New York close



Mon.

Fri.

Month chg.

YTD chg.
Crude oil (-CL)

$91.85

$91.86

-0.37%

-7.06%
(per barrel)











Heating oil (-HO)

$3.2091

$3.2239

1.58%

10.12%
(per gallon)











Natural gas (-NG)

$3.486

$3.6110

5.08%

16.63%
(per mil. BTU)











Unleaded gasoline (-RB)

$2.8503

$2.8928

-2.39%

7.26%
(per gallon)











Brent crude 

$115.80

$114.62

1.03%

7.78%
(per barrel)











Retail gasoline

$3.7870

$3.7940

0.00%

15.60%
(per gallon; AAA)












Citigroup shares rose $1.91 to $36.66 after posting adjusted earnings that surged from the prior year and beat expectations. The growth came as mortgage lending increased and capital markets results rebounded. The performance was tops among S&P 500 stocks.

The earnings report led to gains for many financial stocks. Goldman Sachs (GS), which reports third-quarter results on Tuesday, was up $4.30 to $124.50. Bank of America (BAC), which reports Wednesday, added 32 cents to $9.44, tops among the 30 Dow stocks.

September retail sales rose 1.1%, the Commerce Department said. That was above the 0.8% growth that had been anticipated. Moreover, the report revised higher its estimates for August retail sales.

One driver to the report was big sales of Apple's iPhone 5, but IHS Global Insight noted that the gains were quite broad and included auto sales, electronics sales (read: iPhone 5) and
gasoline service stations. That wasn't a surprise because retail pump prices were above $3.80 a gallon for nearly all of September.

Sprint is flat on Softbank deal, but Clearwire jumps
Sprint-Nextel was off 4 cents to $5.69 after Japanese mobile operator Softbank said it would buy up to 70% of the company for $20.1 billion. The price was expected.

You saw the excitement in the deal from Clearwire (CLWR), up 37 cents to $2.69. Wall Street is speculating that Clearwire, which builds and operates cellphone towers, will be part of the combination.

Along with that speculation, shares of American Tower (AMT), a Clearwire rival, were up $3.18 to $75.35.

Sprint competitor AT&T (T) lost 42 cents to $35.21 and was the biggest drag on the Dow, while Verizon Communications (VZ) was off 12 cents to $44.50. Telecom was the worst-performing sector in the S&P 500.
Hasbro (HAS) shares were down $1.55 to $37.75 after Goldman Sachs cut its rating on the stock to "sell" from "neutral" due to accelerating industry declines, secular declines in games and puzzles, and slowing growth in boys' toys. The target is moved to $32 from $34.

Microsoft (MSFT) shares were up 31 cents to $29.51. The company unveiled its new Xbox music service that will include a music store, free music streaming on the Xbox and the  ability to download individual tracks or listen to songs without advertising. It will be available Oct. 26 on Windows 8 phones. (Microsoft publishes MSN Money.)

While the obvious competitive rival is Apple, the service also is a competitive threat to Internet music service Pandora (P), whose shares were down 29 cents to $9.11.

Will Amazon.com buy TI's mobile chip business?
If you want audacious in your deal, look no further than the report that Amazon.com (AMZN) is in talks to buy Texas Instruments' (TXN) mobile chip business.

Investors took the idea seriously. TI rose 94 cents to $28.22. Amazon was up $1.82 to $244.18.

The Israeli newspaper Calcalist reported that Amazon.com is in advanced talks to buy TI's smartphone business. A deal would be a clear signal of the company's ambitions in the smartphone sector.

The report said a deal would probably be worth billions of dollars and could make Amazon, led by founder and CEO Jeff Bezos, a direct rival to Apple and Samsung Electronics, which also design their own chips.

A big week for earnings
This is one of the biggest weeks for earnings, with some 84 companies in the S&P 500 releasing results. They include IBM (IBM), Intel (INTC), Goldman Sachs, Coca-Cola (KO), Microsoft and General Electric (GE).

Of the 38 companies in the S&P 500 that have reported earnings for the third quarter, 57.9% have reported earnings above analyst expectations, 21.1% reported earnings in line with analyst expectations and 21.1% reported earnings below analyst expectations, according to Thomson Reuters.

Since 1994, 62% of companies beat estimates, 17% match and 21% miss estimates. Over the past four quarters, 67% of companies beat estimates, 10% matched and 24% missed estimates.
Short hits from the markets -- New York close



Mon.

Fri.

Month chg.

YTD chg.
Treasury yields











13-week Treasury bill

0.1000%

0.100%

11.11%

900.00%
5-year Treasury note 

0.660%

0.663%

4.76%

-20.48%
10-year Treasury note

1.663%

1.663%

1.59%

-11.12%
30-year Treasury bond

2.843%

2.835%

-6.23%

-1.59%
Currencies











U.S. Dollar Index

79.806

79.740

-0.27%

-0.89%
British pound

1.6080

1.6088

-0.50%

3.49%
(in U.S. $)

 








U.S. $ in pounds

£0.622

£0.622

0.50%

-3.37%
Euro in dollars

$1.30

$1.30

0.83%

0.03%
(in U.S. $)

 








U.S. $ in euros

€ 0.772

€ 0.772

-0.82%

-0.03%
U.S. $ in yen 

78.80

78.43

1.07%

2.21%
U.S. $ in Chinese

6.29

6.27

0.15%

-0.56%
yuan











Canada dollar

$1.021

$1.022

0.45%

4.10%
(in U.S. $)

 








U.S. dollar 

$0.980

$0.978

-0.37%

-3.94%
(in Canadian $)

 








Commodities

 

 

 

 
Gold (-GC)

$1,737.60

$1,759.700

-2.05%

10.90%
(per troy ounce)

 








Copper (-HG)

$3.7015

$3.703

-1.50%

7.73%
(per pound)

 








Silver (-SI)

$32.7430

$33.669

-5.30%

17.30%
(per troy ounce)

 








Wheat (-ZW)

$8.4825

$8.568

-6.01%

29.95%
(per bushel)

 








Corn (-ZC)

$7.3725

$7.528

-2.51%

14.04%
(per bushel)

 








Cotton 

$0.7234

$0.714

2.39%

-21.10%
(per pound)

 








Coffee

$1.6085

$1.617

-7.29%

-29.96%
(per pound)

 








Crude oil (-CL)

$91.85

$91.860

-0.37%

-7.06%
(per barrel)










 

402Comments
Oct 15, 2012 1:34PM
avatar
Retail sales are up - are people actually buying more or are they just spending more money for the same amount of stuff?
Oct 15, 2012 1:26PM
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until manufacturing comes back, we're in continued trouble

 

>>>>>>Manufacturing in New York contracted more than economists expected in September<<<<<

Oct 15, 2012 1:33PM
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5,000,000 people delinquent on their mortgages and in limbo land. Great economy, isn't it?
Oct 15, 2012 1:23PM
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If the retail sales numbers are good, the market should rise. 
One thing to keep in mind though, is that we're into the season of the two biggest commercial holidays of the year.

This crap about Futures being up, because Spain is expected to ask for what amounts to a Subsidized Economic Band Aid, is complete bullchit.
Oct 15, 2012 1:20PM
avatar
Stronger economic data.....until after the election.....LOL Stock market always up......prior to debates....LOL
Oct 15, 2012 1:23PM
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And so it begins...

Happy Monday and the next presidential debate day tomorrow.

Oct 15, 2012 3:17PM
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Is it just me or have all the numbers changed for the better since the debate? It's just all too obvious how everything is looking so good now for Obama. How can people get by with telling a bare face lie to the American people like that? He is a crook and a liar!!! It was proven in the debate that he don't know what to say if someone don't write it down for him. Look at the promises he made 4 years ago and compare them to now. He not only broke his promises he made them all worse. I can't understand for the life of me how people can actually vote for him, other than the people on welfare and food stamps, they are the only ones he cares about. If we want this country in one piece we need to get him out of office or we are doomed.
Oct 15, 2012 2:58PM
avatar
The only "Retail Sales" that probably soared were Staples or Office Depot and that is because of the kids going back to school & needing supplies.  What other Retail could be soaring other than the I-Phone5???  The way the article is written makes it sound like all Retail is booming...it should read:  "2 or 3 Retailers are doing great & everything else sucks"!!!!!!!
Oct 15, 2012 3:20PM
avatar
Unions do not equal quality. Pull your head out. 

Once you are a "made man:" in the unions you can sit around all day with your thumb up your azz eating cheetos and they can't fire you. 
Oct 15, 2012 3:13PM
avatar
VL-Remember that Dubya was in Air Force One and Cheney in a bunker BEFORE the first plane crashed into the World Trade Center.


OMG, you are an idiot. Bush stayed in a hotel in Sarasota, FL the night before he visited the school. He was on AF-1 the day before. 

Oct 15, 2012 1:34PM
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"Yea!! We're saved!!!" 

 

As opposed to last week which was "Ohhh....we're not saved"

Oct 15, 2012 2:57PM
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I just saw a headline that read, "can politicans fix the economy"?

 

That is one of the most rediculous quesitons I have ever heard. 

 

Poliicans can't fix can't fix anything.   They can only screw things up.

This should be self evident from the past 8 adminitstrations.  And yes

it has come from both sides of the aisle.  Dems and repubs must share

the blame equally.

 

Used to be able to depend on the private sector for short term fixes and then

the government to bail them out, but now the government is bleeding red ink

faster than we can borrow it from China and the private sector is no where to be

found.. 

 

Both sides are failing miserably now.

Oct 15, 2012 1:50PM
avatar
Did my Xmas shopping early before everything costs more "On Sale".
Oct 15, 2012 2:09PM
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Retail sales are up because prices are up. People buying the same or less, but it all cost more. If you don't believe it, then you must not eat or buy household goods. 
Oct 15, 2012 2:17PM
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873,000 based on a phone survey.
114,000 based on Hiring data.
How did the hiring data miss those 759,000 jobs? Is that within the margin of error???
581,000 part time jobs that don't cut it, that's how.

Obama's plan for Moving Forward;
Everybody works Part Time! Unemployment at near ZERO!!!!!!!!!!!!!!!!​!

No wonder the market's up!!!!!

Oct 15, 2012 3:40PM
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So the government doesnt include gas costs in inflation but includes it in retail sales. The government doesnt think, they know the American are stupid.
Oct 15, 2012 1:57PM
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Another day of reading the headlines and IGNORING the facts.
Oct 15, 2012 1:27PM
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here we go again! shift your attention an sneak in an reap the profits before you notice what happens!!!!!  look close at what you are advised to invest in! be careful!!!!!!!!! 

Oct 15, 2012 2:28PM
avatar

Obama - Doubling Down on the Lies.


Washington Times


October 14th, 2012



The killing of a U.S. ambassador and three other Americans in  on the anniversary of the September 11th terrorist attacks has turned into a massive scandal that threatens to unravel in the final three weeks of the 2012 presidential campaign.

Even the mainstream media, after falling for and parroting the administration’s absurd lie that the  was attacked after a protest over a short video posted on  in June, seems to be taking notice. The question is whether reporters will follow the trail of lies and deceit or leave off just as the whole mess is imploding.


Oct 15, 2012 3:00PM
avatar
The live for today menality is reflected in retail sales. Over 5 million in defalut or foreclosure and will be broke come retirement when the impending market collapse happens and Social security implodes. Even with the recent run up of stocks more than 100%, the largest 100 public pension funds have around $1.2 trillion of unfunded liabilities.
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