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Market News: Facebook, Tesla, Onyx Pharmaceuticals, Tyson Foods

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The stock markets in the United States trade higher as investors speculated that the Federal Reserve will slightly reduce its bond purchases program based on the latest durable goods orders data early on Monday.  Economists believe the Fed will taper its $85 billion bond buying to $75 billion. Federal Reserve Chairman Ben Bernanke said the bond purchase reduction will start by the end of the year.

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However, the stock markets ended the day in the red after U.S. Secretary of State John Kerry issued a statement that Syria’s use of chemical weapons was “undeniable” and President Obama is planning an action against the country. According to Kerry, Syria’s action is real and compelling and the international community needs to respond to it.

Kerry said, “Make no mistake: President Obama believes there must be accountability for those who would use the world’s most heinous weapons against the world’s most vulnerable people. Nothing today is more serious, and nothing is receiving more serious scrutiny.”

The U.S. Department of Commerce reported that orders for durable goods in the United States declined 7.3%. Demand for manufactured goods such as aircraft, computers, and defense equipment among others dropped in July, the biggest decline since August last year. Data indicated that non-defense capital goods orders excluding aircraft fell by 3.3%. Capital goods orders are monitored closely because it serves as a proxy for business spending plans.

A report from Bloomberg quoted a comment from Eric Teal, chief investment officer at First Citizens BancShares Inc. (NASDAQ:FCNCA) that the data showed slow recovery and less tapering on the side of the Fed. He said, “This is all pointing towards less tapering by the Fed, which is probably bullish for the stock market in general.”

U.S. Markets

  • Dow Jones Industrial Average (DJIA)- 14, 961 (-0.33%)
  • S&P 500- 1,658 (-0.33%)
  • NASDAQ- 3,659 (+0.04%)
  • Russell 2000- 1,033 (+1.17%)

European Markets

  • EURO STOXX 50 Price EUR- 2,821 (-0.16%)
  • FTSE 100 Index- 6,492 (+0.70%)
  • Deutsche Borse AG German Stock Index DAX- 8,435 (+0.22%)

Asia Pacific Markets

  • Nikkei 225- 13, 636 (-0.18%)
  • Hong Kong Hang Seng Index- 22, 005 (+0.65%)
  • Shanghai Shenzhen CSI 300 Index- 2, 335 (+2.13%)

Stocks In Focus

Market capitalization of Facebook Inc (NASDAQ:FB) reached over $100 billion after the stock price of the social network giant reached as much as $41.93 per share on Monday. Investors are optimistic that Facebook is capable of increasing its advertising revenue from mobile. Facebook’s stock value started to move upwards after reporting outstanding quarterly financial performance last June.

Tesla Motors Inc (NASDAQ:TSLA) rose to as high as $173 per share today after the California New Car Dealers Association (CNCDA) reported that electric car manufacturer’s Model S vehicle the third most popular luxury and sports car vehicle in California. Investors are confident that Tesla’s popularity will widen once its vehicles become increasingly available in the market.

Onyx Pharmaceuticals, Inc. (NASDAQ:ONXX) increased by nearly 6% to as much as $123.70 per share after announcing its agreement to sell the company to Amgen, Inc. (NASDAQ:AMGN) for $125 per share or $10.4 billion.  Amgen also surged by almost 8% to as high as $116.25 per share on Monday. The acquisition will allow Amgen to expand its product offerings. Ian Soimaiya, an analyst at Piper Jaffray, upgraded its rating for shares of Amgen to Overweight with $140 price target.

Tyson Foods, Inc. (NYSE:TSN) declined by more than 7% to as low as $29.12 a share after analysts at Bank of America Merrill Lynch (BAML) downgraded their rating for the stock to Neutral.

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