Mid-Day Market Report Wednesday February 1st, 2012
In a rare interview with Harvard Business School that was published online earlier this month, (it has since been taken down) value investor Seth Klarman spoke at length about his investment process, philosophy and the changes value investors have had to overcome during the past decade. Klarman’s hedge fund, the Boston-based Baupost has one of Read More
- US: Dow: 12766.60 (1.06%), S&P 500: 1328.11 (1.20%), NASDAQ: 2851.51 (1.34%)
- Europe: CAC: 3367.46 (2.05%), DAX: 6616.64 (2.38%), FTSE: 5790.72 (1.88%).
- Asia:China: 2268.08 (0.00%),Hong Kong: 20333.37 (-0.28%),India: 5235.70 (0.70%),Japan: 8809.79 (0.08%)
- Metals: Gold: 1749.10 (0.50%), Silver: 33.78 (1.54%), Copper: 3.84 (1.37%)
- Energy: Crude Oil: 98.29 (-0.19%), Natural Gas: 2.41 (-3.72%)
- Commodities: Corn: 6.44 (0.74%), Soya Bean: 12.13 (1.17%), Wheat: 6.75 (1.31%)
- Currency: EUR/USD: 1.3165 (0.62%), GBP/USD: 1.5841 (0.51%), USD/JPY: 76.2600 (-0.01%)
- 10 year US Treasury: 1.833% (0.036)
Market News Update
US markets jump 1%: Solid economic reports from around the globe sent stocks whizzing higher on the first trading day of the month following Wall Street’s best January performance in 15 years. As of 12:00 p.m. ET, the Dow Jones Industrial Average jumped 136 points, or 1.1%, to 12769, the S&P 500 rallied 14.4 points, or 1.1%, to 1327 and the Nasdaq Composite rose 33.2 points, or 1.2%, to 2847. http://money.cnn.com/2012/02/01/markets/markets_newyork/index.htm?iid=HP_LN
Obama calls for home loan refinancing plan: President Barack Obama on Wednesday called on Congress to approve a $5 billion to $10 billion effort to helpU.S. homeowners refinance as part of a wider package of proposals to shore up the depressed housing market.
Manufacturing activity at highest level in seven months: Manufacturing in the U.S. grew in January at the fastest pace in seven months, adding to signs of a global pickup from Germany to China. The Institute for Supply Management’s index climbed to 54.1, from 53.1 in December, the Tempe, Arizona-based group’s report showed today. Figures greater than 50 signal expansion. http://www.foxbusiness.com/economy/2012/02/01/manufacturing-sector-expands-at-highest-rate-since-june/
Company News Update
- Amazon.com Inc. (AMZN) tumbled 8.6 percent, the most in the S&P 500, to $177.66. Sales missed estimates, signaling that its investments in media services, Kindle devices and shipping promotions have been slow to pay off.
- Health insurer Aetna (AET) posted a sharply higher quarterly profit in line with Wall Street’s target as its members’ low use of health services kept its claim costs down.
- Broadcom Corp. (BRCM), maker of chips that help mobile devices connect to the Internet, gained 8.4 percent after forecasting sales that may top estimates.
- Whirlpool (WHR) shares jumped 17% after the company beat Wall Street expectations on both earnings and revenue.
- Shares of Tupperware (TUP) fell after the company reported earnings per share that fell 3 cents short of forecasts.
- Hershey’s (HSY) shares edged lower after the chocolate maker reported earnings and sales in line with estimates.
- Northrop Grumman (NOC) reported quarterly earnings that topped analysts’ expectations, sending shares higher on Wednesday, but revenue fell short of estimates.
- Pfizer (PFE) is recalling 1 million packs of birth control pills, after the pharmaceutical giant discovered that some blister packs may contain an inexact count of inert or active ingredient tablets, and that the tablets may be out of sequence. Birth control pills typically have to be taken in sequence to be effective.
- NYSE Euronext (NYX) announced early Wednesday that it will terminate its merger agreement with Deutsche Boerse. The proposed $10 billion takeover of the operator of the New York Stock Exchange would have created the world’s largest exchange, but was quashed by European officials.
- Chrysler on Wednesday reported January U.S. sales rose 44% from a year ago, marking the best month of January since 2008 during the worst of the financial crisis. General Motors (GM) sales fell by 6% after strong sales a year ago. Ford (F) saw a monthly increase of 7.3%, short of projections
Hedge Fund News Update
- Harvest Capital Strategies, a San Francisco-based $1.3bn alternative investment manager, has this month launched a new long/short equity hedge fund. The offerings, the Harvest Franchise Fund Qualified and the Harvest Franchise Fund Offshore, implement a long-biased US-focused strategy, details an investor document.
- Majedie Asset Management has closed its Tortoise hedge fund to new investors as assets approach the £350m mark.
- Arden Asset Management LLC, a leading independent fund of hedge funds manager, has selected HedgeMark Risk Analytics LLC, a division of HedgeMark International LLC, to provide position level risk reporting and data aggregation, it was announced today.Arden made its decision following an extensive review of industry risk specialists.
- The assets held by sovereign wealth funds (SWFs) climbed to a record $4.8trn in 2011, up for the third year running, though allocations to the hedge fund space fell by 1%, according to TheCityUK’s report Sovereign Wealth Funds 2012.
- · Goldman Sachs’ Petershill venture, a private equity fund that buys minority stakes in alternatives managers, has backed Altana Wealth, a new hedge fund manager set up by Lee Robinson. Robinson was co-founder of Trafalgar Asset Managers, a hedge fund manager in which Petershill bought a 20% stake in April 2008.
- Citi today announced that Veritable, L.P. has awarded it a mandate to provide a comprehensive suite of hedge fund services including middle office, fund accounting, and investor services. Veritable, L.P. is among the largest independently owned Registered Investment Advisors in theUnited States providing unbiased, tax efficient, integrated investment solutions for families of substantial wealth.
- Todd Edgar, former global head of macro trading at Barclays Plc (BARC) in London, is starting hedge fund Atreaus Capital LLC in May, according to a person familiar with his plans.
- Nervous hedge funds managers are stress-testing their portfolios and searching for ways of protecting themselves against their worst nightmare — a potential break-up of the euro zone.
- U.S.buyout firm TPG on Wednesday agreed to buy hedge fund administrator GlobeOp Financial Services S.A. for GBP508 million, its first foray into the hedge fund business.