Every afternoon we provide an update on global market levels, company news, economic news, and hedge fund news. Stocks in focus today include; EMG, FDO, YHOO, CSX, FRX, S, SCHW, INTC, AUQ
Post Market Update
- US: Dow: 12805.50 (0.62%), S&P 500: 1363.67 (0.74%), NASDAQ: 2910.04 (0.45%)
- Europe: CAC: 3176.97 (-0.09%), DAX: 6577.64 (0.18%), FTSE: 5629.09 (-0.59%).
- Asia-Pacific: Australia: 4140.80 (0.87%), China: 2161.19 (0.61%), Hong Kong: 19455.33 (1.72%), India: 5192.85 (-0.08%), Japan: 8755.00 (0.35%).
- Metals: Gold: 1589.50 (-0.13%), Silver: 27.32 (-0.02%), Copper: 3.46 (-0.85%)
- Energy: Crude Oil: 89.22 (0.88%), Natural Gas: 2.80 (-0.18%)
- Commodities: Corn: 7.71 (-0.16%), Soya Bean: 15.90 (0.00%), Wheat: 8.97 (-0.06%)
- Currency: Euro (€) / US Dollar ($) (EURUSD): 1.2290 (-0.16%), British Pound Sterling (UK£) / US Dollar ($) (GBPUSD): 1.5651 (-0.11%), US Dollar ($) / Japanese Yen (¥) (USDJPY): 79.0650 (0.25%)
- 10 year US Treasury: 1.508% (0.035)
Market and Economy News Update
U.S. markets end higher: U.S. markets closed higher erasing losses made earlier in the day after Federal Reserve Chairman Ben S. Bernanke said the central bank was prepared to take steps to boost growth. The Dow Jones Industrial Average (INDEXDJX:.DJI) rallied 78.33 points, or 0.62 percent, to finish at 12,805.54. The S&P 500 (INDEXSP:.INX) jumped 10.03 points, or 0.74 percent, to end at 1,363.67, while the NASDAQ Composite (INDEXNASDAQ:.IXIC) added 13.10 points, or 0.45 percent, to close at 2,910.04.
Oil prices rise: Oil prices gained for the fifth consecutive day to jump to a seven-week high amid investor speculation that crude inventories fell. Crude oil for August delivery increased 0.9 percent, to settle at $89.22 a barrel on the New York Mercantile Exchange. Brent oil for September settlement climbed 0.6 percent to $104 a barrel on the London-based ICE Futures Europe exchange.
Stocks in Focus
- Intel Corporation (NASDAQ:INTC) posted second-quarter earnings excluding items of 54 cents per share that topped the average analysts’ estimate of 52 cents a share. Revenue came in at $13.5 billion, in-line with Street expectations.
- Yahoo! Inc. (NASDAQ:YHOO) reported second-quarter earnings excluding items of 27 cents per share, on revenue of $1.08 billion. Analysts were expecting the company to report earnings of 23 cents per share on revenue of $1.1 billion.
- Railroad operator CSX Corporation (NYSE:CSX) posted second quarter earnings of 49 cents a share, that beat analysts’ estimates of 47 cents a share, but revenue missed expectations.
- Sprint Nextel Corporation (NYSE:S) launched the faster 4G LTE network in 15 cities across the United States. Credit Suisse AG increased its price target for the stock, following the network upgrade.
- Discount broker Charles Schwab Corp (NYSE:SCHW) reported better than expected 16 percent rise in second-quarter earnings, helped by a one-time gain from a confidential settlement with a vendor.
- Forest Laboratories, Inc. (NYSE:FRX) reported a 79 percent drop in fiscal first quarter net income after its antidepressant Lexapro lost patent exclusivity, allowing other companies to sell generic versions of the drug.
- Online brokerage TD Ameritrade Holding Corp. (NYSE:AMTD) said third quarter profits fell 2 percent to $153.8 million, or 28 cents a share, amid weaker trading volumes and low interest rates.
- Integrated energy company Entergy Corporation (NYSE:ETR) forecast better than expected second-quarter profit, due to higher profit at its utility and wholesale commodities units.
- Apparel retailer Ralph Lauren Corp (NYSE:RL) said that CFO Tracey Travis will resign at the end of the month.
- Financial-services company Fidelity National Information Services (NYSE:FIS) posted second quarter earnings excluding one-time items of 66 cents a share, topping expectations for 59 cents a share. Sales stood at $1.46 billion, slightly lower than Street estimates.
- Railroad company Kansas City Southern (NYSE:KSU) reported a slightly higher than expected second quarter profit, but revenues came in lower than expected.
- Audio technology company, DTS Inc. (NASDAQ:DTSI), warned that second-quarter revenue would fall short of estimates on account of macroeconomic factors that have hurt demand.
- Design software company Autodesk, Inc. (NASDAQ:ADSK) has agreed to acquire mobile video-sharing application, Socialcam, for about $60 million in cash.
- Chinese education company New Oriental Education & Tech Grp (NYSE:EDU) said that the U.S. Securities and Exchange Commission has launched an investigation into its businesses.
- Canadian miner AuRico Gold Inc (NYSE:AUQ) said that Rene Marion has stepped down as president and chief executive, for health reasons.
- Digital video recorder maker TiVo Inc. (NASDAQ:TIVO) has agreed to buy advertisement research company, TRA Inc, for approximately $20 million to increase its presence in the television analytics market.
Hedge Fund News Update
- Traxis Partners LP told clients it will liquidate the Traxis Global Equity Macro Fund, a $300 million fund solely managed by its deceased founder Barton Biggs, and transfer the assets to its flagship fund, the Traxis Fund.
- Hedge fund giant Man Group Plc (LON:EMG) has completed the acquisition London-based hedge fund research and investment specialist, FRM Holdings, in a deal worth $142.8 million.
- Nelson Peltz’s Trian Fund Management had offloaded a substantial stake in Family Dollar Stores, Inc. (NYSE:FDO) between July 10 and 11.
- Eashwar Krishnan, Lone Pine Capital’s former Asia chief, has raised $500 million for his Asia- focused long/short Equity Fund. The Hong Kong-based Tybourne Capital Management started trading earlier this month.
- London-based Capula Investment Management LLP is planning to start a European distressed assets hedge fund, and has hired a former Bank of America Corp (NYSE:BAC) executive, Steven Zander, to oversee the fund.
Brokerage Upgrades and Downgrades on Tuesday, July 17, 2012
- Aeropostale, Inc. (NYSE:ARO) was upgraded to “equal weight” from “underweight” at Morgan Stanley.
- Continental Resources, Inc. (NYSE:CLR) was raised to “buy” from “hold” by analysts at Canaccord Genuity.
- Chipotle Mexican Grill, Inc. (NYSE:CMG) was lifted to “buy” from “neutral” by analysts at Citigroup.
- Enbridge Inc (USA) (NYSE:ENB) was raised to “overweight” from “equal weight” by analysts at Barclays Capital.
- HollyFrontier Corp (NYSE:HFC) was upgraded to “outperform” from “underperform” by analysts at Raymond James.
- L’Oreal (ADR) (PINK:LRLCY) was lifted to “neutral” from “underperform” at Credit Suisse.
- Limited Brands, Inc. (NYSE:LTD) was raised to “outperform” from “neutral” by analysts at Robert W. Baird with a price target of $54.
- Las Vegas Sands Corp. (NYSE:LVS) was upgraded to “positive” from “neutral” by analysts at Susquehanna.
- Prudential Financial Inc (NYSE:PRU) was lifted to “strong buy” from “outperform” at Raymond James.
- The Walt Disney Company (NYSE:DIS) was raised to “buy” from “neutral” by analysts at Bank of America.
- Arch Coal Inc (NYSE:ACI) was downgraded to “fair value” from “buy” by analysts at CRT Capital with a target price of $7.
- Agnico-Eagle Mines Limited (USA) (NYSE:AEM) was cut to “market perform” from “outperform” by analysts at Raymond James.
- Cintas Corporation (NASDAQ:CTAS) was downgraded to “market perform” from “outperform” at Barrington Research.
- D.R. Horton, Inc. (NYSE:DHI) was lowered to “market perform” from “outperform” by analysts at Raymond James.
- Dunkin Brands (NASDAQ: DNKN) was cut to “neutral” from “overweight” by analysts at JPMorgan Chase.
- Express, Inc. (NYSE:EXPR) was downgraded to “equal weight” from “overweight” by analysts at Morgan Stanley.
- Human Genome Sciences (NASDAQ:HGSI) was cut by analysts at JPMorgan Chase from “overweight” to “neutral.”
- KB Home (NYSE:KBH) was downgraded by analysts at Raymond James from “market perform” to “underperform.”
- Smithfield Foods, Inc. (NYSE:SFD) was lowered to “equal weight” from “overweight” by analysts at Stephens.
- Viacom, Inc. (NASDAQ:VIAB) was cut to “neutral” from “buy” by analysts at Bank of America with a target price of $54.