Stocks Regaining Ground But Buying Interest Subdued
Stocks have moved modestly higher in early trading on Wednesday, regaining some ground after ending the previous session mostly lower. The major averages have moved to the upside, bouncing off yesterday's three-month closing lows.
The major averages have pulled back off their highs for the young session but currently remain in positive territory. The Dow is up 6.95 points or 0.1 percent at 12,763.13, the Nasdaq is up 11.04 points or 0.4 percent at 2,894.93 and the S&P 500 is up 1.97 points or 0.1 percent at 1,376.50.
Bargain hunting following the recent weakness in the markets is contributing to the early strength on Wall Street, although buying interest has remained somewhat subdued.
While better than expected quarterly results from Cisco Systems (CSCO) have generated some positive sentiment, traders are also digesting a report showing a bigger than expected drop by U.S. retail sales.
Shares of Cisco have surged up by 6.9 percent after the networking giant reported better than expected fiscal first quarter results after the close of trading on Tuesday.
Other networking stocks are also moving higher on the news, contributing to a 1.9 percent gain by the NYSE Arca Networking Index.
Meanwhile, gold stocks have come under pressure on the day, dragging the NYSE Arca Gold Bugs Index down by 2 percent. IAMGOLD (IAG) is leading the sector lower after reporting disappointing third quarter results.
On the economic front, the Commerce Department said retail sales fell by 0.3 percent in October following an upwardly revised 1.3 percent increase in September. Economists had expected sales to edge down by 0.1 percent compared to the 1.1 percent growth originally reported for the previous month.
Peter Boockvar, managing director at Miller Tabak, said, "Bottom line, the Northeast storm had an obvious impact to sales in October so it's tough to gauge what the natural state of business would have been otherwise."
A separate report from the Labor Department showed that U.S. producer prices unexpectedly decreased in the month of October amid a drop in prices for light trucks and passenger cars.
In overseas trading, stock markets across the Asia-Pacific region closed mostly higher on Wednesday. While Japan's Nikkei 225 Index closed only just above the unchanged line, Hong Kong's Hang Seng Index surged up by 1.2 percent.
Meanwhile, the major European markets moved to the downside on the day. The U.K.'s FTSE 100 Index has slid by 0.7 percent, while the German DAX Index and the French CAC 40 Index are down by 0.5 percent and 0.4 percent, respectively.
In the bond market, treasuries have come under pressure, giving back some ground following recent strength. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 3.3 basis points at 1.622 percent, bouncing off a two-month closing low. | Canadian Market |  | | CADUSD | Oil | Gold | Allbanc |  |  |  |  | | Please click on the images to view our interactive charts | | TSX Dips At Open Wednesday
Toronto stocks dipped at open Wednesday amid selling in commodities, with the S&P/TSX Composite Index losing 42.72 points or 0.35 percent to 12,091.93.
Among gold plays, Iamgold Corp. dived 12 percent after reporting third-quarter net earnings that missed consensus estimates. Fertilizer maker Potash Corp. was down 2 percent, while Agrium Inc. was losing about 0.50 percent.
In the oil patch, Bonterra Energy and ARC Resources were down around 1 percent each. Meanwhile, food and pharmaceutical company METRO Inc. rose over 1 percent after posting improved fourth-quarter net earnings
Precision GPS products and technologies company Hemisphere GPS Inc edged up 1 percent even after reporting a wider third quarter net loss.
The price of crude oil was steady above $85 Wednesday morning as traders were cautiously optimistic that President Barack Obama will resolve the impending "fiscal cliff" that could derail the fragile recovery in the world's largest economy. Crude for December eased $0.24 to $85.14 a barrel.
The price of gold was little changed amid a steady U.S. dollar as traders await cues from the minutes of the FOMC meeting, due out later today. Gold for December edged up $3.00 to $1,727.80 an ounce.
In corporate news from Canada, Iamgold Corp. reported improved third-quarter net earnings of $78.0 million or $0.21 per share compared to $50.0 million or $0.13 per share in the third quarter 2011. However, adjusted net earnings dipped to $60.2 million or $0.16 per share from $112.4 million or $0.30 per share Analysts expected the company to report earnings of $0.25 per share for the quarter.
Food and pharmaceutical company METRO Inc. posted an improved fourth-quarter net earnings of C$143.3 million or C$1.46 per share compared to C$84.4 million or C$0.83 per share reported a year ago. Adjusted net earnings were C$123.4 million or C$1.24 per share for the quarter.
Precision GPS products and technologies company Hemisphere GPS Inc reported a wider third quarter net loss of $2.7 million or $0.04 per share compared with loss of $2.02 million or $0.03 per share for the prior-year period. Further, the company said it does not expect to meet the previous 10 percent revenue-growth target for the year, citing lower-than-expected growth in the third quarter and that it will refrain from providing full-year guidance due to the restructuring programs.
Healthcare services provider Medical Facilities Corp. announced that it would acquire a 51 percent interest in the Arkansas Surgical Hospital, L.L.C., which operates the Arkansas Surgical Hospital.
China focused corn products company Asia Bio-Chem Group Corp. reported that its third quarter net loss widened to C$11.1 million or C$0.13 per share from C$4.3 million or C$0.05 per share in the year ago quarter. Yesterday, the plunged 27 percent. |
| European Market | | | | FTSE 100 | Euronext | Dax perf | CAC 40 |  |  |  |  | | Please click on the images to view our interactive charts | | European Markets Trade Weak Amid Economic Worries
The European markets are trading lower on Wednesday, as global economic worries continued to weigh on investor sentiment, amid anti-austerity protests in the continent.
Greek Finance Minister Giannis Stournaras and Labor Minister Giannis Vroutsis told the European Parliament's Economic Affairs and Employment Committees on Tuesday that it is up to the EU to come forward with the next aid tranche.
There were many distortions in the Greek finance and labor markets that had to be tackled, but Greece has taken all the necessary measures, they noted.
Debt-ridden Greece successfully raised 4.06 billion euros on Tuesday by selling short term bills, easing concerns about how it would repay its debt maturing on Friday.
Meanwhile, The Greek economy contracted at a faster pace in the third quarter, preliminary data from the Hellenic Statistical Authority showed. Gross domestic product, on an unadjusted basis and at constant prices, fell 7.2 percent year-on-year in the third quarter, after falling 6.3 percent in the second quarter. The economy has contracted for the seventeenth consecutive quarter.
Eurozone industrial output dipped by a seasonally adjusted 2.5 percent in September from a month ago, Eurostat said. Economists had forecast a 2 percent fall after rising 0.9 percent in August.
Number of people claiming jobseeker's allowance in the U.K. rose by 10,100 in October from September to 1.58 million, the Office for National Statistics said. The jobless claim figure was forecast to remain flat in October. The claimant count rate remained unchanged at 4.8 percent in October.
The Bank of England said in its quarterly inflation report that GDP growth is likely to fall back sharply in the fourth quarter. Inflation in near term is expected to be higher than estimated in August.
The Euro Stoxx 50 index of eurozone bluechip stocks is falling 0.33 percent, while the Stoxx Europe 50 index, which includes some major U.K. companies, is losing 0.65 percent.
The German DAX, the French CAC 40 and Switzerland's SMI are losing 0.4 percent each. The UK's FTSE 100 is falling 0.6 percent.
In Frankfurt, Infineon Technologies is surging 5.2 percent. The company reported fourth-quarter results. Deutsche Bank is gaining 1.4 percent while Commerzbank is moderately lower.
RWE is up 0.3 percent. The utility now sees slightly higher full-year EBITDA as it is now slightly more confident than it was three months ago.
Peer EON, which reported third-quarter results on Tuesday, is falling 1.8 percent. Several analysts reduced their ratings on the utility. K+S is losing 2.4 percent. The specialty chemicals firm also reported financial results on Tuesday.
In Paris, EDF is declining 2.5 percent. EADS is down 1.6 percent and LVMH is losing around 1 percent. Vivendi is advancing 4.6 percent. The media and telecommunications company Tuesday reported a sharply higher third-quarter profit. Alcatel Lucent is rising 3.4 percent and STMicroelectronics is gaining 2.4 percent.
In London, Inter-dealer broker ICAP reported a sharp decline in profit for the first half, as margins dropped due to reduction in revenue from voice broking as well as a decline in electronic volumes. The stock is declining 5.3 percent.
Ryanair Holdings is declining 6.4 percent. Citigroup cut the stock to "Neutral" from "Buy.''
Evraz is declining 3.4 percent and Eurasian Natural Resources is falling 2.7 percent. Glencore and Xstrata are notably lower. S&P Equity raised Vodafone to "Buy" from "Hold.'' the stock is down 1 percent.
Sainsbury is losing 2.1 percent after reporting first-half results. Kingfisher and Burberry are down around 1.5 percent each.
AMEC is climbing 3 percent. Weir Group is gaining 1.7 percent and Centrica is rising 1.5 percent. |
| Asia Market | Asian Stocks Pare Losses As Greece Fears Recede
Asian stock markets ended mostly higher on Wednesday, paring early losses, as a successful bond auction in Greece reduced the risk of a Greek default on a 5 billion euro debt repayment due later this week. A survey showing a jump in Australian consumer sentiment in November, renewed pledges by Chinese leaders to take necessary steps to bolster the world's second-largest economy during meetings this week in Beijing and a degree of optimism that U.S. lawmakers would forge a deal to avoid the year-end "fiscal cliff" spurred bargain hunting in beaten down stocks following recent losses.
Japanese share rose marginally, ending seven days of losses, as investors hunted for bargains among consumer finance, realty and metal stocks following recent steep losses on worries over U.S. budget woes. The Nikkei average closed up 0.04 percent, while the broader Topix index ended down 0.02 percent. Sharp Corp soared 7.2 percent on reports that Intel and Qualcomm Inc are in talks to invest about 30 billion to 40 billion yen in the debt-stricken consumer electronics maker. Aiful climbed 30 percent to a three-year high after the consumer finance firm reported a 76 percent jump in its April-September group net profit.
Among those that fell, China-related Komatsu and Fanuc fell 1-2 percent, exporters Nikon and Toyota Motor fell about a percent each and Seiko Holdings plunged 10 percent after lowering its full-year earnings forecast. Hitachi Metals and Hitachi Cable plummeted 10-12 percent after they unveiled plans to merge in April.
China's Shanghai Composite index rose 0.4 percent, with aluminum companies leading the gainers after the state-run China Securities Journal said that the State Bureau of Material Reserve plans to stockpile 400,000 metric tons of the metal by Dec. 29. Yunnan Aluminum, Jiaozuo Wanfan Aluminum Manufacturing and Chalco rallied 3-5 percent.
Meanwhile, the week-long 18th Communist Party Congress ended today, with the country's ruling party re-electing the nation's future leaders Xi Jinping and Li Keqiang onto its Central Committee, which will in turn elect the Political Bureau, the Standing Committee of the Political Bureau and the General Secretary at its first plenary session tomorrow. Hong Kong's Hang Seng index gained 1.2 percent on bargain hunting.
Australian shares rebounded from six-week lows, led by banks after data showed Australian consumer confidence surged to a 19-month high. The Westpac-Melbourne Institute Index of Consumer Sentiment increased 5.2 percent from the previous month to 104.3 in November, suggesting that the central bank's interest rate cuts since November last year are starting to have an impact on household confidence. "This is a welcome and surprisingly strong result," Westpac Chief Economist Bill Evans said.
The benchmark S&P/ASX 200 rose 0.2 percent to 4,388 in cautious trading after hitting a low of 4,372 early in the session. The broader All Ordinaries index closed up 0.15 percent at 4,411. Among the major banks, Westpac, NAB, ANZ and Commonwealth rose between 0.2 percent and 0.7 percent. Insurer QBE rallied 2.4 percent after steep losses in the previous session following an earnings downgrade. In the resource sector, BHP Billiton edged down marginally, but Rio Tinto gained 0.3 percent and Fortescue Metals Group added 0.8 percent.
Seoul shares snapped a four-session losing streak, led by technology stocks. However, gains were capped by renewed foreign selling and the continued anxiety over the looming U.S. fiscal cliff. The benchmark Kospi average ended the session up 0.2 percent. Foreign funds remained net sellers for a fifth straight day, offloading shares worth a net 75.3 billion Korean won, data showed.
Among the prominent gainers, LG Electronics and SK Hynix jumped about 5 percent each. Shares of LG Display eased 0.3 percent amid reports that its ailing rival Sharp Corp is in talks to get a cash injection of hundreds of millions of dollars from U.S.-based Intel Corp.
New Zealand shares lost ground, dragged down by carpet maker Cavalier and retailer Kathmandu Holdings after weak third-quarter retail sales data reinforced concerns about the sluggish economic recovery. Statistics New Zealand said that retail sales fell a seasonally adjusted 0.4 percent by volume in the three months ended September, adding to the gloom from data last week showing the unemployment rate hit a 13-year high.
The benchmark NZX-50 index slipped 0.4 percent. Both Cavalier and Kathmandu fell about 3 percent each. Goodman Property Trust lost 2.8 percent after announcing a capital raising to fund full acquisition of an Auckland business park, Highbrook.
Elsewhere, Indonesia's Jakarta Composite index rose 0.4 percent and the Taiwan Weighted average added 0.3 percent, while Malaysia's KLSE Composite eased 0.4 percent and Singapore's Straits Times index was down 0.9 percent. The Indian market was closed for Diwali. |
| Commodities | | | | USDCAD | USDEUR | USDGBP | USDJPY |  |  |  |  | | Please click on the images to view our interactive charts | | Crude Steady Above $85
The price of crude oil was steady above $85 Wednesday morning as traders were cautiously optimistic that President Barack Obama will resolve the impending "fiscal cliff" that could derail the fragile recovery in the world's largest economy.
Light Sweet Crude Oil (WTI) futures for December delivery, edged up $0.21 to $85.59 a barrel. Yesterday, oil extended losses mostly on demand concerns after the International Energy Agency slashed its global demand forecast for the commodity. Investor also weighed the U.S. fiscal cliff looming ahead with spending cuts and tax hikes indicated in January if a deal is not reached.
This morning, the U.S. dollar was leveling off from its 2-month high versus the euro, while steady around 2-month high against sterling and the Swiss franc. The buck was paring recent losses versus the yen.
In economic news, euro zone industrial output dipped by a seasonally adjusted 2.5 percent in September from a month ago, Eurostat reported. Economists had forecast a 2 percent fall after rising 0.9 percent in August.
Meanwhile, the number of people claiming job-seeker's allowance in the U.K. rose by 10,100 in October from September to 1.58 million, the Office for National Statistics said. The jobless claim figure was forecast to remain flat in October. The claimant count rate remained unchanged at 4.8 percent in October, and matched economists' expectations.
U.K. GDP growth is set to fall back sharply in the fourth quarter, the Bank of England said its quarterly Inflation Report, published on Wednesday. Further, the outlook for UK growth remains uncertain, it said. According to BoE, output is more likely than not to remain below its pre-crisis level until towards the end of the forecast period. The bank sees a greater risk of economy staying in a period of persistent low growth.
Traders will look to the retail sales report for October from Commerce Department, due out at 8:30 am ET. For October, economists estimate a 0.1 percent decline in retail sales but a 0.2 percent increase in retail sales, excluding autos.
Simultaneously, the U.S. Labor Department will release its report on the producer price index for October. Economists expect the headline index as the core producer price to have risen by 0.2 percent in October.
Later during the session, the Commerce Department is scheduled to release its business inventories report for September. The report is expected to show a 0.4 percent increase in business inventories for the month compared to a 0.5 percent increase in August.
The Federal Reserve is due to release the minutes of its September 12-13th meeting at 2 pm ET. |
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