Midday on the fly: Walmart gains, Mattel loses
March retail sales exceed forecasts, but higher borrowing costs for Spain weigh on sentiment.
By about 1:30, the Dow was up 93.28, or 0.73%, to12,942.87; the Nasdaq was down 16.78, or 0.56%, to 2,994.55; and the S&P 500 was up 2.36, or 0.17%, to 1,372.62.
The U.S. economic data was also mixed, with retail sales data strong but manufacturing and housing data weak. Financial stocks, which began the day strong, also weakened during the morning hours, with several cutting their opening gains in half.
Domestically, the Advance Retail Sales report showed sales rose 0.8% in the month of March. If autos and gasoline are removed from the data, the core reading was up 0.7%, versus expectations for an increase of 0.5%. The Empire Manufacturing report had a reading of 6.56, versus expectations of a reading of 18.0. The April Housing Market Index was reported at 25, versus forecasts of 29. Business inventories were up 0.6% in February, which matched expectations. Internationally, the yield on Spain's 10-year bonds topped 6% for the first time since before the European Central Bank launched its first liquidity operation.
Citigroup (C) reported stronger than expected adjusted first-quarter earnings, keeping up the trend begun with the reports Friday from peers JP Morgan (JPM) and Wells Fargo (WFC). Citi shares rose modestly, up about 2% near noon. Among others reporting earnings, Mattel (MAT) and Gannett (GCI) both declined, with Mattel down 8.5% and Gannett sliding nearly 8%. Among the Dow's gainers that drove that average to out pace the others were Walmart (WMT), P&G (PG) and Home Depot (HD), with all three seeing shares rise about 1% after the retail sales report.
Among the notable gainers were Edelman Financial (EF), up 42%, after agreeing to be taken private by Lee Equity Partners for $8.85 per share, and Dreams, Inc. (DRJ) up 30%, on news it will be acquired by Fanatics for $3.45 per share. Also noteworthy were shares of Endocyte (ECYT), which more than doubled, after the company entered into an agreement with Merck (MRK) to develop and commercialize its investigational cancer therapy vintafolide. Noteworthy losers included Pendrell Corporation (PCO), down 45%, after an appeals court overturned a previous ruling that ordered Boeing (BA) to pay $603M to a Pendrell subsidiary, and Halozyme (HALO), down nearly 25%, on news the FDA is requesting additional information from the company and partner Baxter (BAX) to complete the review of the HyQ Biologics License Application. Baxter also sold off on the news, falling 6.5%.
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