11/5/2012 12:01 PM ET
Stocks continue to turn in a lackluster performance in mid-day trading on Monday, with traders reluctant to make any significant moves ahead of tomorrow's elections. The choppy trading comes after the markets ended last week's trading roughly flat.
The major averages are currently turning in a mixed performance, although they are all nearly unchanged. While the Nasdaq is up 5.34 points or 0.2 percent at 2,987.47, the Dow is down 13.98 points or 0.1 percent at 13,079.18 and the S&P 500 is down 1.66 points or 0.1 percent at 1,412.54.
Many traders seem to be staying on the sidelines amid uncertainty about the outcome of Tuesday's presidential race between President Barack Obama and Republican challenger Mitt Romney.
In the short-term, investors will be looking for a definitive outcome from the election, as a race that is still too close to call or requires a recount will add to insecurity on Wall Street.
Looking further ahead, a win for Obama is expected to be good news for the alternative energy, telecom, and housing sectors, while a win for Romney could benefit the defense, resource, and financial sectors.
Along with the outcome of the presidential race, traders are also likely to keep an eye on which party controls the House and the Senate following the elections.
On the economic front, the Institute for Supply Management released a report showing a modest slowdown in the pace of growth by the U.S. service sector.
The ISM said its non-manufacturing index dipped to 54.2 in October from 55.1 in September, although a reading above 50 indicates continued growth in the service sector. Economists had expected the index to edge down to a reading of 54.9.
Peter Boockvar, managing director at Miller Tabak, said, "For reasons we all know, American business is dealing with a lack of visibility on a variety of issues both here and abroad, one of which of course will be resolved tomorrow."
"From a market perspective, the emotional response from the election results will be the main driver into year end, with the practical results being dealt with in 2013," he added.
Among individual stocks, KBW, Inc. (KBW) is posting a notable gain after the financial services provider agreed to be acquired by Stifel Financial (SF) in a transaction valued in excess of $575 million. KBW is currently up by 7 percent.
Auto giant Toyota (TM) is also moving to the upside after reporting a quarterly profit that rose sharply year-over-year and raising its profit forecast for the full year.
Meanwhile, shares of Time Warner Cable (TWC) have come under pressure after the cable-television operator reported weaker than expected third quarter earnings amid the loss of video customers. Time Warner Cable is currently down by 6.7 percent.
Sector News
While many of the major sectors continue to show only modest moves, considerable strength has emerged among biotechnology stocks. The NYSE Arca Biotechnology Index has surged up by 2.6 percent, climbing further off last Wednesday's four-month closing low.
InterMune (ITMN) and Sequenom (SQNM) are turning in two of the biotech sector's best performances, jumping 10.7 percent and 5.8 percent, respectively.
Oil service stock are also seeing considerable strength, driving the Philadelphia Oil Service Index up by 1.4 percent. Transocean (RIG) has helped to lead the sector higher, advancing by 5 percent after reporting better than expected adjusted third quarter earnings.
Electronic storage and networking stocks are also posting notable gains, helping to keep the tech-heavy Nasdaq in positive territory.
On the other hand, utilities stocks have come under significant selling pressure, dragging the Dow Jones Utilities Average down by 1.5 percent. With the loss, the average has fallen to a four-month low.
Southern Co. (SO) has helped to lead the utilities sector lower, sliding 2.5 percent after reporting disappointing third quarter results.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Monday. Japan's Nikkei 225 Index and Hong Kong's Hang Seng Index both ended the day down by 0.5 percent, while China's Shanghai Composite Index edged down by 0.1 percent.
The major European markets also moved to the downside on the day. While the French CAC 40 Index tumbled by 1.3 percent, the German DAX Index and the U.K.'s FTSE 100 Index both fell by 0.5 percent.
In the bond market, treasuries have moved higher amid the uncertainty about the election results. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 4.5 basis points at 1.681 percent.
| Canadian Market |  | | CADUSD | Oil | Gold | Allbanc |  |  |  |  | | Please click on the images to view our interactive charts | | 11/5/2012 11:06 AM ET
Canadian stocks were little changed Monday morning as traders preferred to exercise caution ahead of Tuesday's presidential election in the U.S. Opinion polls show the race between President Barack Obama and Republican challenger Mitt Romney remains neck-and-neck.
Meanwhile, commodities struggling to make meaningful gains as risk appetite waned ahead of the US elections and a leadership change in China.
The S&P/TSX Composite Index edged up 19.14 points or 0.16 percent to 12,399.55, a day after snapping its six-session winning streak.
The price of gold was ticking higher Monday morning as the U.S. dollar was trading firm versus a basket of currencies. Gold for December added $7.90 to $1,683.10 an ounce.
Among gold plays, Royal Gold (RGL.TO), Barrick Gold (ABX.TO), Agnico-Eagle Mines (AEM.TO) and Goldcorp. (G.TO) were up around 2 percent each.
Egypt focused precious metals miner Centamin plc (CEE.TO) soared 30 percent.
The price of crude oil was edging up Monday morning after China's service-sector activity showed moderating growth in October. The HSBC Purchasing Managers Index for China's services sector released on Monday showed the index slipped to 53.5 in October from September's four-month high of 54.3, as higher costs and greater competition squeezed margins.
Crude for December edged up $0.32 to $85.18 a barrel.
In the oil patch, Equal Energy Ltd. (EQU.TO) skyrocketed 22 percent after announcing the sales of its Lochend Cardium assets for cash consideration of $62 million.
International oil and gas company Petrominerales (PMG.TO) reported funds flow from operations for the third quarter ended 30 September 2012 of $151.9 million, or $1.68 per diluted share, lower than funds flow from operations of $196.34 million, or $1.88 per diluted share, reported for the corresponding quarter last year. The stock rose 7 percent.
Meanwhile, construction company Churchill Corp. (CUQ.TO) shed nearly 2 percent after reporting a lower third-quarter net earnings at C$1.8 million or C$0.07 per share compared to C$6.1 million or C$0.24 per share in the same quarter last year. Analysts expected the company to report earnings of C$0.03 per share for the quarter.
Silver miner Silver Wheaton Corp. (SLW.TO) slipped 1 percent after reporting d that its third-quarter net earnings were $119.7 million or $0.34 per share, down from $135.0 million or $0.38 per share for the same period in 2011. Analysts expected the company to report earnings of $0.40 per share for the quarter.
Bio pharmaceutical company Bioniche Life Sciences Inc. (BNC.TO) dived 19 percent after announcing that a second Phase III clinical trial with Urocidin in non-muscle-invasive bladder cancer is being discontinued.
In economic news from Canada, the Statistics Canada said total value of building permits fell 13.2 percent to $6.5 billion in September, after advancing 9.5 percent in August. The decline was mainly the result of the non-residential sector, where the value of permits in all three components fell.
From the U.S, the Institute for Supply Management said its non-manufacturing index dipped to 54.2 in October from 55.1 in September, although a reading above 50 indicates continued growth in the service sector. Economists had expected the index to edge down to a reading of 54.9.
Elsewhere, confidence among euro zone investors increased for a third month in a row in November, reflecting an improvement in their assessment of the current situation as well as expectations of future economic developments, data released by the think-tank Sentix showed. The Sentix Index rose to -18.8 in November from -22.2 in October and -23.2 in September. Economists had forecast an increase in the reading to -21.1. |
| European Market | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  |  |  |  | | Please click on the images to view our interactive charts | | 11/5/2012 12:34 PM ET
The Swiss stock market posted a modest gain on Monday, thanks to the positive performance of some its most heavily weighted defensive stocks. Financial stocks and economically sensitive stocks were among the weakest performers.
Investors were cautious at the start of the new trading week, ahead of tomorrow's U.S. presidential election. The race between Barack Obama and Mitt Romney has been incredibly close. The ISM non-manufacturing data released in the afternoon also came in lower than expected.
The Swiss Market Index rose by 0.07 percent Monday and finished at 6,706.27. The Swiss Leader Index added 0.01 percent, but the Swiss Performance Index closed unchanged.
The positive performance of Nestle provided support to the overall market. Nestle climbed by 0.9 percent and Roche added 0.2 percent. Transocean was the largest gainer on Monday, with an increase of 4.5 percent. The company reported a third quarter loss of US$381 million.
Shares of Leclanché sank by 58 percent Monday. The battery manufacturer is faced with delays in many projects of large energy storage devices. Also, the market for lithium-ion cells developed for micro-solarpower plants on private homes has not performed as expected. As a result the company adjusted its revenue and earnings estimates. |
| Asia Market | 11/5/2012 6:12 AM ET
Indian shares moved in a narrow range before ending slightly higher on Monday, led by defensive FMCG and healthcare stocks. Global cues remained weak, with stocks falling across and Europe as investors adopted a cautious approach ahead of Tuesday's tightly-fought U.S. presidential election and the once-a-decade Communist Party Congress starting Thursday that will usher in sweeping leadership changes.
Also, the rupee fell to a two-month low of 54.50 in intraday trading, weighed down by a weaker euro ahead of the Greek parliamentary vote on austerity measures slated for Wednesday, limiting upside potential.
The benchmark BSE Sensex moved in the range of 18,683-18,795 before ending 7 points or 0.04 percent higher at 18,763, with only 11 of its components advancing. The broader Nifty index rose by 7 points or 0.11 percent to 5,704, while the BSE mid-cap and small-cap indexes ended down 0.3 percent and 0.1 percent, respectively.
Among the top gainers in the Nifty pack, Coal India, Cipla, Ambuja Cement, BPCL, Dr Reddy's Laboratories, Asian Paints, ACC, ITC and Kotak Mahindra Bank rose 1-2 percent. JP Associates, Jindal Steel, Bajaj Auto and Hindalco topped the selling list, falling 2-3 percent.
The Sirpur Paper Mills rose 2.4 percent ahead of a board meeting later this week to consider a corporate debt restructuring. Godrej Industries gained 1.6 percent following news that Vivek Gambhir will succeed A Mahendran as the managing director of the company.
ONGC rose 0.3 percent after Japan's Inpex Corp took a 26 percent stake in an offshore Indian exploration block from the company.
Market heavyweight Reliance Industries edged down 0.4 percent amid the controversy over performance audit of the production-sharing contract of its KG-D6 fields. Larsen & Toubro ended flat with a positive bias after the construction and engineering giant said its infrastructure arm L&T Construction has bagged an order worth Rs 1,252 crore from the Delhi Metro.
Shares of Kingfisher Airlines hit the 5 percent lower circuit limit, snapping a seven-day winning streak in the wake of reports that the government will not renew its license to fly.
Crompton Greaves plunged 8.3 percent after the electrical equipment maker reported a 64 percent dip in quarterly consolidated net profit. IVRCL fell 1.4 percent even as it won new orders worth Rs. 515 crore across its buildings, power and transportation divisions.
Reliance Power slipped half a percent despite reporting a better-than-expected 2.1 percent rise in quarterly net profit. Jubilant Foodworks lost 2.4 percent on a brokerage downgrade. Allahabad Bank lost 2.1 percent on disappointing earnings results.
In economic news, Finance Minister P Chidambaram said that he expects to see GDP growth of as little as 5.5 percent this fiscal year before returning to 7 percent growth in 2013. |
| Commodities | | | | USDCAD | USDEUR | USDGBP | USDJPY |  |  |  |  | | Please click on the images to view our interactive charts | | 11/5/2012 7:07 AM ET
The price of crude oil was little changed Monday morning after a private survey report revealed China's service-sector activity showed moderating growth in October.
The HSBC Purchasing Managers Index for China's services sector released on Monday showed the index slipped to 53.5 in October from September's four-month high of 54.3, as higher costs and greater competition squeezed margins.
Light Sweet Crude Oil (WTI) futures for December delivery, was trading flat at $84.86 a barrel. Last week, oil settled at a fresh 3-month low as traders speculate that demand for crude will be lower than anticipated in the aftermath of Hurricane Sandy. Also, the US dollar continued to strengthen against a basket of major currencies after some upbeat jobs data out of the U.S., putting pressure on oil prices.
This morning, the U.S. dollar advanced near a two-month high versus the euro and the Swiss franc, while moving up to a two-week high against sterling. The buck was hovering near a 4-month high versus the yen.
In economic news, confidence among euro zone investors increased for a third month in a row in November, reflecting an improvement in their assessment of the current situation as well as expectations of future economic developments, data released by the think-tank Sentix showed. The Sentix Index rose to -18.8 in November from -22.2 in October and -23.2 in September. Economists had forecast an increase in the reading to -21.1.
From the U.S., the ISM is due to release the results of its service sector survey for October at 10 am ET. The non-manufacturing index is expected to edge down to 54.9 in October from 55.1 in September.
During this week, traders focus will be on the Institute for Supply Management's non-manufacturing survey for October, the Commerce Department's trade balance report for September, the weekly jobless claims report and the preliminary reading of the Reuters and the University of Michigan's consumer sentiment survey for November.
Also, focus will be on the crude oil inventories data from the API, due out Tuesday after the market hours, and the EIA due out the subsequent day. |
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