On the day Americans celebrate the man who discovered our continent - Christopher Columbus - investors were discovering new 2009 highs on three of the four major indices. The Dow Jones Industrials, S&P 500 and NYSE Composite all closed at highs of the year, with the Dow eclipsing an intra-day high with the new mark now 9931.82, just 69 points shy of the enormously psychological 10,000 mark.
Stocks were up sharply in the opening hour, but weakened into the afternoon, and sold off sharply between 2:00 and 2:30 pm, sending the Dow and NASDAQ into negative territory. The Dow recovered to close modestly positive, but the NASDAQ, surprisingly weak on the session, finished fractionally lower. It was the only major index to close in the red. The sudden drop on the indices, though very sharp, was probably due to options expiration this week, as a major trader likely closed a large number of positions. The general market didn't seem to make much of it, as all of the indices recovered nicely with strong buying into the close.
Interestingly, the Dow Jones Transports sported solid gains on the day. The transports have been something of a laggard in recent sessions, but showed remarkable strength into the close, led by Ryder Systems (R) nearly 10% one-day move.
The act that the Transportation Index also closed at a new 2009 high is a bullish signal, inferring that rail and truck transport - the things that move goods across the nation and to the ports - are showing signs of recovery. Those issues are at the bottom of the economy, with shipping of energy - coal, natural gas, oil - and goods of all manner on the rise.
Dow 9,885.80, +20.86 (0.21%)
NASDAQ 2,139.14, -0.14 (0.01%)
S&P 500 1,076.18, +4.69 (0.44%)
NYSE Composite 7,051.16, +35.62 (0.51%)
Market internals were positive, in line with the headline numbers. Advancing issues beat decliners, 3386-3002, though there were quite a few more losers than gainers on the NASDAQ. There were 731 new highs to 67 new lows, a bullish sign. The new high-new low indicator has been the most reliable metric for market movement, though there is some fear that stocks may be getting to an overbought condition as earnings begin rolling out. Companies will have to show top-line growth this quarter in order to keep pace with their high valuations.
Volume was low due to the observance of Columbus Day.
NYSE Volume 4,169,401,250
NASDAQ Volume 1,758,818,250
Commodities were a big story on the day. Oil sipped past the $73.00 mark, gaining $1.50, to close at $73.27. Gold caught a bid higher, by $8.90, to finish at $1,057.50. Silver also gained 13 cents, to $17.82. The resumption of the rally in the precious metals seems to have been re-ignited by oil's gains.
The only notable earnings-related news was from Black & Decker, which pre-announced better-than-expected results. Market direction for Tuesday may be guided by Johnson & Johnson (JNJ), which is supposed to released 3rd quarter earnings prior to the bell. There will be some anticipation concerning Intel (INTC), which reports after the close.
Showing posts with label JNJ. Show all posts
Showing posts with label JNJ. Show all posts
Monday, October 12, 2009
Tuesday, October 16, 2007
More Reality Checks
US equity markets suffered through a second straight losing session on Tuesday, amid skyrocketing oil prices and mixed earnings reports.
Dow 13,912.94 -71.86; NASDAQ 2,763.91 -16.14; S&P 500 1,538.53 -10.18; NYSE Composite 10,125.40 -90.89
It was another dose of reality for the largely-overpriced markets. Fed Chairman Ben Bernanke and Secretary of the Treasury Hank Paulson both jawboned about the continuing housing and credit crises. Bernanke chided bankers from expecting a "bailout" from the Fed on Monday night, while Paulson encouraged the same bankers to figure out ways to save strapped homeowners from falling into foreclosure.
In effect, they both told the banking segment that they were on their own, as it should be. The actual condition is that Fed and Treasury have both been supplying assistance to the banks. These men aren't stupid. They know a banking failure could be catastrophic, however, reading into their words, one wonders what they really know, and whether they actually believe the situation to be much worse than it appears.
Obviously, the bankers know the fix they're in, but they're not telling either. The best they can come up with is a joint fund to repurchase their own lousy paper, which they are unable to unload at this time. I don't know the technical term for their off-the-books repurchasing of faulty investment paper, but it certainly smells a lot like Enron. It's entirely possible that a very big name or two in the financial business could find itself in deep, deep water as early as the first quarter of '08.
As the markets churned in negative territory all day long, declining issues outdistanced advancers by better than a 2-1 margin and the new highs-lows finally rolled over, with 221 new lows appearing against 168 new highs. That particular indicator has been trending lower over the past week and finally is giving a clear signal that more losing sessions are ahead for stocks.
In other words, in a series of shouting headlines I'd like to see, SELL! EVERYTHING! NOW!
Commodity prices continued to dog stocks. Oil was up to another record high, up $1.48 to $87.61. Experts are now calling for 20-30% higher heating bills throughout the winter. God bless Al Gore for giving us GLOBAL WARMING!
Oddly enough, gold lost 20 cents while silver declined by the same amount, closing at $13.36. BUY PRECIOUS METALS
Stocks are offering a mixed picture.
Before the open: Delta Air Lines (DAL) reported better than expected third quarter earnings of $0.56 per share, compared with the consensus estimate of $0.41.
Wells Fargo missed by $0.02, misses on earnings of $0.68 per share, $0.02 worse than the Reuters Estimates consensus of $0.70. Shares of the bank's stock were hammered down to 34.55, -1.40 by the close.
Johnson and Johnson earned 88 cents per share, compared with 94 cents per share during the same period a year ago. Analysts sought .90 cents per share. The stock fell 58 cents to 65.07.
After the market closed on Wednesday, IBM beat estimates by a penny. Apparently, this was not good enough for investors, as the stock was being punished - down nearly 2% - in after-hours trading.
Holders of Yahoo (YHOO) were treated to the first quarterly results with co-founder Jerry Wang as CEO and they were pleasantly surprised when the company announced earnings of 11 cents per share, beating the street estimate by 3 cents. The stock price was down 1.17 prior to the announcement. Shares traded nearly 10% higher in after-hours activity, up 2.59 to 29.28.
Intel (INTC) reported a 43% rise in profits after the close and investors sent it soaring after hours, up more than 5%.
BUY TECHS!
Actually, I've been recommending techs over financials and just about everything else for most of 2007. This market, as a whole, however, is headed lower.
CIT Group (CIT), Coca-Cola (KO) and United Technologies (UT) report before the market open on Wednesday, and their reports should influence early trading.
NYSE Volume 3,181,638,250
NASDAQ Volume 2,093,682,500
Dow 13,912.94 -71.86; NASDAQ 2,763.91 -16.14; S&P 500 1,538.53 -10.18; NYSE Composite 10,125.40 -90.89
It was another dose of reality for the largely-overpriced markets. Fed Chairman Ben Bernanke and Secretary of the Treasury Hank Paulson both jawboned about the continuing housing and credit crises. Bernanke chided bankers from expecting a "bailout" from the Fed on Monday night, while Paulson encouraged the same bankers to figure out ways to save strapped homeowners from falling into foreclosure.
In effect, they both told the banking segment that they were on their own, as it should be. The actual condition is that Fed and Treasury have both been supplying assistance to the banks. These men aren't stupid. They know a banking failure could be catastrophic, however, reading into their words, one wonders what they really know, and whether they actually believe the situation to be much worse than it appears.
Obviously, the bankers know the fix they're in, but they're not telling either. The best they can come up with is a joint fund to repurchase their own lousy paper, which they are unable to unload at this time. I don't know the technical term for their off-the-books repurchasing of faulty investment paper, but it certainly smells a lot like Enron. It's entirely possible that a very big name or two in the financial business could find itself in deep, deep water as early as the first quarter of '08.
As the markets churned in negative territory all day long, declining issues outdistanced advancers by better than a 2-1 margin and the new highs-lows finally rolled over, with 221 new lows appearing against 168 new highs. That particular indicator has been trending lower over the past week and finally is giving a clear signal that more losing sessions are ahead for stocks.
In other words, in a series of shouting headlines I'd like to see, SELL! EVERYTHING! NOW!
Commodity prices continued to dog stocks. Oil was up to another record high, up $1.48 to $87.61. Experts are now calling for 20-30% higher heating bills throughout the winter. God bless Al Gore for giving us GLOBAL WARMING!
Oddly enough, gold lost 20 cents while silver declined by the same amount, closing at $13.36. BUY PRECIOUS METALS
Stocks are offering a mixed picture.
Before the open: Delta Air Lines (DAL) reported better than expected third quarter earnings of $0.56 per share, compared with the consensus estimate of $0.41.
Wells Fargo missed by $0.02, misses on earnings of $0.68 per share, $0.02 worse than the Reuters Estimates consensus of $0.70. Shares of the bank's stock were hammered down to 34.55, -1.40 by the close.
Johnson and Johnson earned 88 cents per share, compared with 94 cents per share during the same period a year ago. Analysts sought .90 cents per share. The stock fell 58 cents to 65.07.
After the market closed on Wednesday, IBM beat estimates by a penny. Apparently, this was not good enough for investors, as the stock was being punished - down nearly 2% - in after-hours trading.
Holders of Yahoo (YHOO) were treated to the first quarterly results with co-founder Jerry Wang as CEO and they were pleasantly surprised when the company announced earnings of 11 cents per share, beating the street estimate by 3 cents. The stock price was down 1.17 prior to the announcement. Shares traded nearly 10% higher in after-hours activity, up 2.59 to 29.28.
Intel (INTC) reported a 43% rise in profits after the close and investors sent it soaring after hours, up more than 5%.
BUY TECHS!
Actually, I've been recommending techs over financials and just about everything else for most of 2007. This market, as a whole, however, is headed lower.
CIT Group (CIT), Coca-Cola (KO) and United Technologies (UT) report before the market open on Wednesday, and their reports should influence early trading.
NYSE Volume 3,181,638,250
NASDAQ Volume 2,093,682,500
Tuesday, July 17, 2007
Earnings, Politics Swing Markets
For the nest two weeks, market movements are likely to be a function of 2nd quarter earnings reports, though Tuesday may have been an exception.
Of the major reports flowing from corporate offices, the following:
Note that all of the companies listed above either beat or met expectations, but the overall market barely budged.
Dow 13,971.55 +20.57; NASDAQ 2,712.29 +14.96; S&P 500 1,549.37 -0.15; NYSE Composite 10,170.36 -17.82
Why? Could it be the price of crude oil, which hit a high of $75.35 earlier in the day before being hammered down to $74.02, a loss of 13 cents? Or the shifting political tides in Washington, which look to put Bush & Co. out of business in a matter of months? There's a storm brewing, and impeachment and military failure in the field (which has already occurred) are not likely to aid the mood on Wall Street.
Oil will slide to less than $60 per barrel if an end to the Iraq situation is found soon and it's looking more and more like that will be the case, but Wall Street isn't so sure, plus, the finality of the Bush administration may mean closer scrutiny of corporate governance and possibly even an SEC with real investigative and subpoena powers.
So, politics are moving the markets, even while corporate earnings are about as solid as one would like.
Decliners beat out advancing issues by an 11-9 margin and the gap narrowed again, with new highs checking in at 430 to 211 new lows.
On tap for tomorrow (company, ticker, expectations):
Gold and silver were both marginally lower. No surprise there.
Of the major reports flowing from corporate offices, the following:
- Forest Labs (FRX): Net income rose to $268.2 million, or 83 cents per share, in the fiscal first quarter ended June 30, from $200.6 million, or 62 cents per share, a year earlier. Analysts had expected 77 cents per share.
- Johnson & Johnson (JNJ): Net income, $3.1 billion, $1.05 a share, up from $2.8 billion, or 95 cents, earned in the second quarter last year. Analysts were calling for $1 a share.
- Merrill Lynch (MER): Net earnings rose to $2.14 billion, or $2.24 a diluted share, compared with $1.63 billion, or $1.63 a share, in the year-earlier period. Analysts sought 2.02 per share.
- Coca-Cola (KO): Profits, on a continuing operations basis, were $1.98 billion, or 85 cents a share, cleanly beating Wall Street's call of 82 cents a share.
- Wells Fargo & Company (WFC): Net revenue of $2.28 billion, or 67 cents per share for the 2nd quarter, compared with net income of $2.09 billion, or 61 cents per share, a year earlier. The numbers were in line with expectations of 0.67 per share.
- CSX Corporation (CSX): Reported earnings of $324 million, or 71 cents per share. Last year the company reported second quarter earnings of $390 million, or 83 cents per share which included a one-time 25 cent gain, so analysts were only looking for 64 cents and the company delivered handily.
- Intel Corporation (INTC): The company reported revenue of $8.7 billion and earnings per share of 22 cents in the second quarter including a tax item that boosted EPS by 3 cents. The resulting 19-cent-per-share profit figure was in line with analyst expectations.
- Yahoo, Inc. (YHOO): Net income for the second quarter fell to $161 million, or 11 cents per diluted share, from the year-earlier quarter's $164 million (0.11). Results were in line with lowered expectations of 11 cents per share.
Note that all of the companies listed above either beat or met expectations, but the overall market barely budged.
Dow 13,971.55 +20.57; NASDAQ 2,712.29 +14.96; S&P 500 1,549.37 -0.15; NYSE Composite 10,170.36 -17.82
Why? Could it be the price of crude oil, which hit a high of $75.35 earlier in the day before being hammered down to $74.02, a loss of 13 cents? Or the shifting political tides in Washington, which look to put Bush & Co. out of business in a matter of months? There's a storm brewing, and impeachment and military failure in the field (which has already occurred) are not likely to aid the mood on Wall Street.
Oil will slide to less than $60 per barrel if an end to the Iraq situation is found soon and it's looking more and more like that will be the case, but Wall Street isn't so sure, plus, the finality of the Bush administration may mean closer scrutiny of corporate governance and possibly even an SEC with real investigative and subpoena powers.
So, politics are moving the markets, even while corporate earnings are about as solid as one would like.
Decliners beat out advancing issues by an 11-9 margin and the gap narrowed again, with new highs checking in at 430 to 211 new lows.
On tap for tomorrow (company, ticker, expectations):
- CIT Group (CIT) 1.35
- eBay (EBAY) 0.32
- Gannett (GCI) 1.21
- Pfizer (PFE) 0.50
- Piper Jaffray (PJC) 0.74
- Southwest Airlines (LUV) 0.22
- United Technologies (UTX) 1.15
Gold and silver were both marginally lower. No surprise there.
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