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.

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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%.

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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 buy TI's mobile chip business?
If you want audacious in your deal, look no further than the report that (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 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



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Oct 15, 2012 3:43PM
Funny how things are so much bettet now since there is only a couple weeks till voting
Oct 15, 2012 3:40PM
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 3:36PM

Retog said;

"Jeff.....I don't want no Cars built by rednecks in Alabamy or Mississsip..They are good at shootin' Gators and guttin' hogs...

Only things they know about cars are when Jimmy,Junior and Jeffy drive around in circles on Saturdays or Sundays..

I want a Union Man/Woman building my cars...I just won't buy one built on Mondays."

You might want to use better examples, as Jimmy Johnson and Gordon both hail from California. It kinda detracts from the point.

Oct 15, 2012 3:31PM

What was proven in the last debate was that Romney can change positions quicker than a rational thinking opponent can formulate a reply. Romney lied about $5 trillion in tax cuts (really can't be paid for by loopholes), lied about Medicare $716b cuts (really reduction in costs), lied about $2 trillion in defense spending increases (nobody but defense contractors and unions want) and lied about caring about 100% of citizens (only cares about himself and his 14% supporters).


Most of us, 90%, are better off today then we were on October 15, 2008 when we were falling off a fiscal and monetary cliff created by Miss Me Yet and his Republican friends that I and many other intelligent people voted for. I have voted for many Republicans but the worst ones were Bush 2 and Nixon.  I did vote for Obama last time and will again because the Republican party has turned into the UnAmerican party. I'm sick and tired of WASP politics screwing up this country.


I remember Cheney was in control of NORAD and told the air traffic controllers who noticed the planes off course to ignore them as they were part of his test of NORAD.


pretty much that fact alone says it all.




Remember that Dubya was in Air Force One and Cheney in a bunker BEFORE the first plane crashed into the World Trade Center.


Oct 15, 2012 3:22PM
How to get to a good unemployment number....1st - Count everybody over 18 years of age. 2nd - Deduct - Those on SS benefits and have opted out for working partime 3rd Deduct all those on Disability Mental or phyical and are really disabled (not the fake disabled bunch) 4th deduct all those that have a full time job of 30 hours or more.  Two Opt out exceptions 1st-  Full time Mother or Father  care giver and 2nd - Higher education Post degrees. This should give you the real Unemployment rate. Part time employment less that 30/wk goes to a seperat under employment number that is combined with the unemployment number for reporting break down purposes.
Oct 15, 2012 3:20PM
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 3:17PM
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 3:15PM

Jeff.....I don't want no Cars built by rednecks in Alabamy or Mississsip..They are good at shootin' Gators and guttin' hogs...

Only things they know about cars are when Jimmy,Junior and Jeffy drive around in circles on Saturdays or Sundays..

I want a Union Man/Woman building my cars...I just won't buy one built on Mondays.


Oct 15, 2012 3:13PM
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 3:04PM

We need to elect common folk with common sense.  I am so sick of politicians.  It's not the people that start wars it's the governments that start wars!


Joe Plumber for president!

Oct 15, 2012 3:03PM

Kyte:  No one believes anything because they don't want information that contrasts their existing viewpoint or forces them to think about what the information means.


What people want are 2 lights.. a green one that says "GOOD" and a red one that says "BAD."  Even then, if they don't want the news to be good they'll won't believe it.  So information is released according an objective published methodology and people can take what they want.  People who know what the information is and how it's collected can use it for useful purposes.. others can mess with it like a chimp with a rubix cube.

Oct 15, 2012 3:00PM
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.
Oct 15, 2012 3:00PM

Half a percent. Half a percent. Half a percent onward.


Into the Rally of Death they rode...


(Of course I'm still in the market. Mine is not to question why...)

Oct 15, 2012 2:59PM

We are just chillin' and nappin' today...

Including all the animals...


We had a big family party/gathering here yesterday...

And I don't remember seeing any Government cheese on any of the tables?

Most  all checks are direct deposited in a couple days...

Except for a big one, that comes in the first of the month...DD.

And all the smaller ones mailed during the month, we blow at Casinos or on G-Kids.

Oct 15, 2012 2:58PM
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 should read:  "2 or 3 Retailers are doing great & everything else sucks"!!!!!!!
Oct 15, 2012 2:58PM
"Unemployment was under 5% with a W and a GOP controlled congress. Look it up. On January 3, 2007, the date that the Democrat-controlled 110th Congress took office after a record 52 months of job growth accelerated by Bush administration tax cuts, unemployment was at 4.6 percent, and the economy was growing at three times the current rate."

History also notes that our economy tanked immediately after that. Banks called credit in on small business and robo-signed millions into foreclosure. These events are BUSINESS. You will find a great deal of commonality in who funded the GOP Super PACs and who made windfall profits off our collapse. YOU are Republican, no living person would put it past your terror group planning a major initiative and trashing America trying to destroy a rival political party. Remember that Dubya was in Air Force One and Cheney in a bunker BEFORE the first plane crashed into the World Trade Center. Remember that the terminated were mostly breadwinners and men who did not contribute to PACs. Remember that the Acts that contributed the most to undermine our financial and economic stability were written by REPUBLICANS.

YOU are a paid political poster. I'm someone's dad.
Oct 15, 2012 2:58PM
Kyte:  To collect information monthly at a reasonable cost...  not really a better way than stastical sampling.
Oct 15, 2012 2:57PM

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



Both sides are failing miserably now.

Oct 15, 2012 2:57PM
Remain cautious...Yes, we were up over 80 points, great...However, and there is always a however, scumbags haven't gone away (unfortunately). At 1435 hrs they called for another wave of selling, now we are trying to hang in there....Just be careful this last hour, we have seen it over and over last week...Crooks never give up...More after the close.
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