Post Market Update
Every afternoon (and morning) we provide an update on global market levels, company news, economic news, and hedge fund news. Highlights for August 20th 2012 below:
- US: Dow: 13271.60 (-0.03%), S&P 500: 1418.13 (0.00%), NASDAQ: 3076.21 (-0.01%)
- Europe: CAC: 3480.58 (-0.22%), DAX: 7033.68 (-0.10%), FTSE: 5824.37 (-0.48%).
- Asia-Pacific: Australia: 4364.30 (-0.13%), China: 2106.96 (-0.38%), Hong Kong: 20104.27 (-0.06%), India: 5366.30 (0.00%), Japan: 9171.16 (0.09%).
- Metals: Gold: 1623.00 (0.22%), Silver: 28.59 (2.11%), Copper: 3.37 (-1.42%)
- Energy: Crude Oil: 95.97 (-0.04%), Natural Gas: 2.78 (2.10%)
- Commodities: Corn: 8.23 (2.04%), Soya Bean: 16.83 (2.29%), Wheat: 9.02 (0.92%)
- Currency: Euro (€) / US Dollar ($) (EURUSD): 1.2348 (-0.11%), British Pound Sterling (UK£) / US Dollar ($) (GBPUSD): 1.5711 (-0.11%), US Dollar ($) / Japanese Yen (¥) (USDJPY): 79.4050 (-0.20%)
- 10 year US Treasury: 1.805% (-0.005)
Market and Economy News Update
U.S. markets end largely unchanged: U.S. markets closed flat on Monday in another session of listless trading, as investor concern about Europe’s debt crisis offset a rally in technology stocks. The Dow Jones Industrial Average (INDEXDJX:.DJI) slid 3.56 points, or 0.03 percent, to finish at 13,271.64. The S&P 500 (INDEXSP:.INX) shed 0.03 point, or less than 0.1 percent, to 1418.13, while the NASDAQ Composite (INDEXNASDAQ:.IXIC) fell 0.38 point, or less than 0.1 percent, to 3076.21. All three indices remained near four-year highs.
Oil prices fall: Oil prices declined on Monday for the first time in four sessions amid investor concerns about the European Central Bank’s ability to get a grip on the region’s debt crisis. Crude oil for September delivery fell 0.04 percent, to settle at $95.97 a barrel on the New York Mercantile Exchange. Brent oil for September settlement slid 0.2 percent to $113.53 a barrel on the London-based ICE Futures Europe exchange.
Stocks in Focus
- Angel investor and hedge fund manager Peter Thiel has sold 22 million Facebook Inc (NASDAQ:FB) shares and will retain 5.6 million shares, according to a filing.
- Apple Inc. (NASADQ:AAPL) ended 2.6 percent higher to become the most valuable company of all time, surpassing Microsoft Corporation (NASDAQ:MSFT), the previous U.S. record holder, that reached a peak market cap of $618.9 billion in December 1999.
- Billionaire hedge fund manager George Soros has acquired a 7.85 percent passive stake in British soccer club, Manchester United PLC (NYSE:MANU), according to a filing.
- Clothing retailer Urban Outfitters, Inc. (NASDAQ:URBN) reported a 8.1 percent rise in second quarter earnings to $61.3 million, or 42 cents a share, from $57 million, or 35 cents a share, a year earlier. Revenue increased 11 percent to $676.3 million. Analysts were expecting earnings of 33 cents a share on revenue of $672 million.
- Discount retailer Tuesday Morning Corporation (NASDAQ:TUES) reported fourth quarter net loss of $2 million, or 5 cents per share, compared with a loss of $1.4 million, or 3 cents per share, a year earlier. Sales increased 1 percent to $196.4 million, while same-store sales rose 0.2 percent during the quarter.
- Movie studio Dreamworks Animation Skg Inc (NASDAQ:DWA) has entered into a new a five-year marketing and distribution agreement with News Corp (NASDAQ:NWSA)’s Twentieth Century Fox.
- Household-products manufacturer Church & Dwight Co., Inc. (NYSE:CHD) has agreed to acquire privately-held vitamins and supplements producer Avid Health for $650 million in cash.
- Fabrinet (NYSE:FN) reported fourth quarter earnings excluding items of $10.7 million or 31 cents per share, compared to $17.5 million or 50 cents per share in the year-ago period. Revenue declined 25 percent to $142.8 million from $190.3 million a year earlier.
- Anglo-Dutch energy giant Royal Dutch Shell plc (ADR) (NYSE:RDS.A) (LON:RDSA) and Chevron Corporation (NYSE:CVX), the second-biggest U.S. oil company by market value, have agreed to swap stakes in two $30 billion-plus natural gas projects off the coast of Australia.
- Kinder Morgan Energy Partners LP (NYSE:KMP) has reached a deal to sell some of its Rocky Mountain natural-gas processing and pipeline assets to Tallgrass Energy Partners LP for about $1.8 billion in cash
- Houston-based trash hauling company Waste Management, Inc. (NYSE:WM) ended 3 percent lower after a Barron’s article said that the company was at risk of falling as much as 15 percent if it continues to pay generous dividends despite the structural challenges.
- Casino stocks Las Vegas Sands Corp. (NYSE:LVS), Wynn Resorts, Limited (NASDAQ:WYNN) and MGM Resorts International (NYSE:MGM) ended significantly higher after analysts at Sterne Agee said their Macau operations are well on track to post record revenue this month.
- Toronto-based gold royalty and metals streaming company Franco-Nevada Corporation (NYSE:FNV) (TSE:FNV) will pay $1 billion to Inmet Mining Corporation (TSE:IMN) for the development of its Cobre Panama copper-gold mining project in Panama.
Hedge Fund News Update
- David Einhorn’s Greenlight Capital Inc. may have made $66 million from its stake in Coventry Health Care, Inc. (NYSE:CVH), as the shares jumped to a four-year high on Monday, following news that health insurer Aetna Inc. (NYSE:AET) will buy the company for $42.08 a share.
- Hedge fund managers kept their net-long positions across commodities near 11-month highs, data from the U.S. Commodity Futures Trading Commission showed.
- Sovereign wealth fund, The Government of Singapore Investment Corp, has bid $1.5 billion for the MSR Resort, a group of bankrupt hotels owned by hedge fund Paulson & Co. Paulson had acquired the hotels in 2011 from Morgan Stanley.
- The Securities and Exchange Commission has again delayed adopting final rules for provisions to the JOBS Act that will end an 80-year-old ban on hedge fund advertising.
- The Ohio Public Employees Retirement System has hired hedge fund managers, Gracie Asset Management, Highline Capital Partners and Third Point LLC, to oversee $100 million each.
- UBS AG (USA) (NYSE:UBS) has launched a new unit, UBS Quant HQ that will combine prime brokerage and capital-raising services for quantitative hedge funds.
- Steven A. Cohen’s SAC Capital Advisors wants the board of Clearwater Paper Corp (NYSE:CLW) to separate the company’s consumer products business from its pulp and paperboard unit, so that it can sell one or both of the businesses, according to a regulatory filing.
Brokerage Upgrades and Downgrades on Monday, August 20, 2012
- Credicorp Ltd. (USA) (NYSE:BAP) was upgraded to “outperform” from “market perform” by analysts at Raymond James.
- Facebook Inc (NASDAQ:FB) was lifted to “buy” from “hold” by analysts at Capstone with a target price of $26.
- Granite Construction Inc. (NYSE:GVA) was raised to “outperform” from “neutral” by analysts at Macquarie.
- Jabil Circuit, Inc. (NYSE:JBL) was upgraded to “buy” from “neutral” by analysts at Longbow Research with a target price of $30.
- Melco Crown Entertainment Ltd (ADR) (NASDAQ:MPEL) was lifted to “buy” from “neutral” by analysts at UBS AG with a target price of $15.
- Prosperity Bancshares, Inc. (NYSE:PB) was raised to “outperform” from “market perform” by analysts at BMO Capital Markets with a target price of $48.
- Ross Stores, Inc. (NASDAQ:ROST) was upgraded to “buy” from “neutral” by analysts at Bank of America with a target price of $80.
- Statoil ASA(ADR) (NYSE:STO) was lifted to a “top pick” rating from “sector perform” by analysts at RBC Capital.
- The Gap Inc. (NYSE:GPS) was raised to “hold” from “sell” by analysts at ISI Group.
- Aastrom Biosciences, Inc. (NASDAQ:ASTM) was downgraded to “neutral” from “buy” by analysts at Roth Capital with a target price of $2.30.
- Armstrong World Industries, Inc. (NYSE:AWI) was lowered to “equal weight” from “overweight” by analysts at Barclays Capital with a target