Every afternoon ValueWalk provides an update on global market levels, economic news, and hedge fund news
- US: Dow: 12986.50 (1.41%), S&P 500: 1387.56 (1.38%), NASDAQ: 3055.55 (1.30%)
- Europe: CAC: 3269.79 (0.98%), DAX: 6743.24 (1.02%), FTSE: 5710.46 (1.33%).
- Asia-Pacific: Australia: 4280.60 (0.81%), China: 2350.86 (1.78%), Hong Kong: 20327.32 (0.92%), India: 5276.85 (0.96%), Japan: 9524.79 (0.69%).
- Metals: Gold: 1677.70 (1.05%), Silver: 32.38 (2.74%), Copper: 3.71 (2.09%)
- Energy: Crude Oil: 103.60 (0.88%), Natural Gas: 1.99 (0.20%)
- Commodities: Corn: 6.29 (0.32%), Soya Bean: 13.72 (1.01%), Wheat: 6.44 (1.74%)
- Currency: EUR/USD: 1.3186 (0.59%), GBP/USD: 1.5962 (0.35%), USD/JPY: 80.8900 (0.04%)
- 10 year US Treasury: 2.058% (0.023)
Market and Economy News Update
U.S. markets rally: Markets rallied for the second straight day after the New York Fed’s president reiterated that interest rates are likely to remain low. The gains came despite initial unemployment filings rising a little more than expected. The Dow Jones Industrial Average (INDEXDJX:.DJI), the S&P 500 (INDEXSP:.INX) and the NASDAQ (INDEXNASDAQ:.IXIC) all closed significantly higher.
U.S. trade deficit shrinks: Trade deficit in the U.S. shrank 12.4 percent to $46 billion in February, as imports fell by the most in three years, and exports hit a record high. This was the biggest month-on-month decline since May 2009. Economists had forecast a deficit of $51.8 billion.
Wholesale prices in the U.S. rise: Labor Department figures showed today wholesale prices excluding volatile food and energy costs rose more than forecast in March. The core producer price index climbed 0.3 percent in February, the fifth successive monthly increase. In the 12 months ended March 2012, wholesale prices increased 2.8 percent, the smallest increase since the year ended June 2010.
Oil rose for the second day: Oil prices rose for a second straight day on Thursday, as investors await a key meeting scheduled for this weekend, between major powers and crude-producer Iran to discuss its disputed nuclear program. Crude-oil futures for May delivery jumped 0.88 percent to $103.60 a barrel on the New York Mercantile Exchange. Brent oil for May settlement gained 1.3 percent on the London- based ICE Futures Europe exchange.
Company News Update
- Internet giant Google Inc (NASDAQ:GOOG) reported first-quarter earnings that topped analysts’ estimates and announced plans to give investors a stock dividend. The company posted first-quarter net income of $2.89 billion, up 60 percent from the same period last year.
- Hewlett-Packard Company (NYSE:HPQ) rallied more than 7 percent in trade today after estimates compiled by research groups Gartner and IDC showed that the company’s personal computer sales in the United States grew by nearly 7 percent over the first quarter of 2011, consolidating its position as the world’s largest maker of personal computers.
- Roche Holding AG (FRA:RHO5) Chief Executive Officer Severin Schwan told analysts and investors on a conference call that the Swiss drugmaker won’t raise the bid of $51 a share without starting talks with Illumina, Inc. (NASDAQ:ILMN).
- Micron Technology, Inc. (NASDAQ:MU), the largest U.S. maker of computer-memory chips, received a boost after Roth Capital, initiating coverage on the stock, rated it a “buy”.
- Cytec Industries Inc. (NYSE:CYT), the maker of reinforced plastics used in aircraft, will buy British aerospace parts supplier Umeco plc (LON:UMC) for about $439 million. Umeco counts The Boeing Company (NYSE:BA), Airbus and Formula One team McLaren as its major customers, and Cytec is hopeful the acquisition will help to leverage its position as a technology leader in advanced composite materials.
- Avid Technology, Inc. (NASDAQ:AVID), the maker of software for digital audio and video production, reported first-quarter revenue of about $152 million, which was below the average analyst estimate of $161.3 million.
- Board of directors of oil service firm Rowan Cos. has approved a plan to move its corporate headquarters to Britain.
- JPMorgan Chase & Co. (NYSE:JPM) and Wells Fargo & Company (NYSE:WFC) are scheduled to report earnings tomorrow morning.
Hedge Fund News Update
- Seth Klarman has unloaded his entire stake in biopharmaceutical company Targacept, Inc. (NASDAQ:TRGT) at a loss of approximately 30 percent. Klarman bought a 16.92 percent stake in the Winston-Salem based company at a purchase price of around $7.26, and cashed out at around $4.9 a share. Targacept recently reported disappointing results of the Phase 3 trials of an experimental anti-depressant drug it was co-developing with AstraZeneca plc (ADR) (NYSE: AZN).
- Edward Lampert has reduced his stake in auto-parts retailer AutoZone, Inc. (NYSE:AZO) from 8.3 percent to 6.2 percent. Lampert, who has been a major investor in AutoZone since 1999, and at one point held a 23 percent stake in company, has been steadily reducing his position in recent months.
- Billionaire investor Carl Icahn is close to buying a stake in the closely held Brazilian iron ore mining company, Ferrous Resources Ltd. (FER), from Phil Falcone’s Harbinger Capital Partners LLC, according to a report by Bloomberg. Icahn is willing to pay $1.50 a share, and is looking at acquiring a 14.9 percent stake in the company.
- Representatives of hedge-fund manager Philip Falcone will next week meet with the Securities and Exchange Commission (SEC) to discuss the terms of a potential settlement over civil fraud charges the SEC is likely to pursue against Falcone and two other Harbinger Capital Management executives, Omar Asali and Robin Roger.
- Man Group Plc (LON:EMG) has appointed Ravi Chari, as co-head of foreign exchange for its $21 billion fund AHL. Chari joins Man from IKOS Asset Management where he headed the group’s futures and foreign-exchange funds
- Former traders at Millennium Management LLC, Tetsuo Ochi, Skira Suzuki, Atsushi Kiyono and Kohei Hayashi, who joined MCP Asset Management in March, are set to launch new hedge funds next month that will primarily invest in Japanese equities.
- Northern Trust Hedge Fund Services LLC, the hedge fund administration unit that Northern Trust formed after acquiring Omnium LLC in July 2011, has secured 22 clients in the last seven months, and now has more than $170 billion in hedge fund assets under administration.
- New York-based alternative asset manager SkyBridge Capital has expanded its global distribution team with the additions of John Langston and Justin Arasin, who will serve as directors of global distribution.