Market Levels
- US: Dow: 12640.80 (0.53%), S&P 500: 1335.02 (0.72%), NASDAQ: 2892.42 (1.17%)
- Europe: CAC: 3090.90 (-0.75%), DAX: 6263.25 (-1.28%), FTSE: 5513.69 (-0.96%).
- Asia-Pacific: Australia: 4048.20 (-0.96%), China: 2260.88 (0.00%), Hong Kong: 18995.13 (-1.42%), India: 5146.05 (-0.37%), Japan: 8798.35 (-0.29%).
- Metals: Gold: 1566.90 (0.09%), Silver: 26.66 (-0.66%), Copper: 3.31 (0.24%)
- Energy: Crude Oil: 79.76 (1.99%), Natural Gas: 2.62 (1.67%)
- Commodities: Corn: 5.54 (0.73%), Soya Bean: 13.75 (0.31%), Wheat: 7.06 (0.93%)
- Currency: Euro (€) / US Dollar ($) (EURUSD): 1.2572 (-0.19%), British Pound Sterling (UK£) / US Dollar ($) (GBPUSD): 1.5590 (0.08%), US Dollar ($) / Japanese Yen (¥) (USDJPY): 80.4150 (0.26%)
- 10 year US Treasury: 1.674% (0.058)
Market and Economy News Update
U.S. markets end higher: U.S. markets bounced back on Friday with banks unexpectedly leading the advance, but Dow and S&P 500 both ended the week lower, while the NASDAQ rose for the third consecutive week. The Dow Jones Industrial Average (INDEXDJX:.DJI) rose 0.5 percent to 12640.78. The S&P 500 (INDEXSP:.INX) was up 0.7 percent to 1335.02., while the NASDAQ Composite (INDEXNASDAQ:.IXIC) jumped 1.2 percent to 2892.42.
Oil prices rise: Oil prices rebounded from an eight-month low and ended higher on Friday as a potential tropical storm in the Gulf of Mexico threatened to disrupt production. Crude oil for August delivery gained 2 percent, to settle at $79.76 a barrel on the New York Mercantile Exchange. Brent oil for August settlement jumped 2 percent to $90.98 a barrel on the London-based ICE Futures Europe exchange.
Stocks in Focus
- Bank of America Corp (NYSE:BAC), JPMorgan Chase & Co. (NYSE:JPM) and Morgan Stanley (NYSE:MS) closed significantly higher, a day after Moody’s Investors Service cut the debt ratings of 15 of the world’s largest banks.
- General Motors Company (NYSE:GM) will recall 413,418 Chevrolet Cruze sedans in the United States to fix a problem that could cause engine-compartment fires.
- Citigroup Inc. (NYSE:C) has agreed to buy a portion of French bank Societe Generale SA (EPA:GLE)’s portfolio of shipping loans for an undisclosed sum.
- Insurance company Old Republic International Corporation (NYSE:ORI) has withdrawn a plan to spin off the mortgage-guaranty operation to its shareholders, following objections from certain shareholders’. The stock tumbled 12 percent in late trading.
- Cruise operator Carnival Corporation (NYSE:CCL) posted second quarter earnings, excluding one time items of 20 cents a share, topping analysts’ estimate of 8 cents a share. Revenue for the quarter fell to $3.54 billion from $3.62 billion in the year ago period. The Miami-based company also raised its full-year outlook.
- Klaus Kleinfeld, Chairman and Chief Executive Officer at Alcoa Inc. (NYSE:AA) said that demand for aluminum is strong in Europe despite the worsening of the euro zone debt crisis.
- Pfizer Inc. (NYSE:PFE) and Protalix BioTherapeutics Inc. (NYSEAMEX:PLX) said that European regulators have ruled against recommending their Gaucher disease drug taliglucerase alfa, because a competing drug from Shire Plc. (ADR) (NASDAQ:SHPGY) has exclusive marketing rights until 2020.
- First Solar, Inc. (NASDAQ:FSLR) has secured approval from the public works department of Los Angeles to install solar modules at a California power plant that is currently under construction.
- Family Dollar Stores, Inc. (NYSE:FDO) closed 1.6 percent higher after Citigroup Inc. raised its target price to $80 from $69 a share.
- Alexza Pharmaceuticals, Inc. (NASDAQ:ALXA) said it has resubmitted a new drug application for its psychiatric drug Adasuve, after the U.S. Food and Drug Administration last month denied approval to the medication.
- Drug developer Repligen Corporation (NASDAQ:RGEN) said the U.S. Food & Drug Administration has denied approval for its experimental pancreatitis treatment RG1068, and has asked for additional clinical trial data.
- NPS Pharmaceuticals, Inc. (NASDAQ:NPSP) jumped 14 percent after a review panel in Europe recommended approval for its short bowel syndrome drug teduglutide.
- Houston-based oil company Harvest Natural Resources, Inc. (NYSE:HNR) has agreed to sell its Venezuelan assets to Indonesia’s state-owned oil and gas company PT Pertamina for $725 million in cash.
Hedge Fund News Update
- Hedge fund manager Bill Ackman has taken a personal 12 percent passive stake in burger chain, Burger King Worldwide Inc. (NYSE:BKW), while his hedge fund Pershing Square Capital Management also acquired a sizeable position in the company, according to a filing with the Securities and Exchange Commission on Friday. Burger King began trading on Wednesday
- London-based Brevan Howard Asset Management LLP is reportedly seeking capital for its latest hedge fund, the Brevan Howard Credit Value Master Fund, which will invests in real-estate linked collateralized debt obligations and mortgage-backed securities, Bloomberg reported. The fund has a minimum investment requirement of $20 million.
- Panning Capital Management LP, founded by Kieran Goodwin, the former head trader at New York-based King Street Capital Management will launch its maiden hedge fund in the middle of October.
- Institutional investors across the globe are showing an increasing appetite for alternative investments, according to a survey conducted by Russell Investments.
- The pension fund for the London Borough of Waltham is looking to allocate £50 million ($78 million) to a hedge fund. Waltham Forest will follow the London Borough of Camden which made a commitment of £50 million ($78 million) to Michael Platt’s BlueCrest Capital Management in April.
- The University of California, which has allocated about $500 million to hedge funds, is planning to add three more hedge fund managers to its investment portfolio.
- Chicago-based hedge fund Pentwater Capital Management LP last month bought 77,800 shares of car rental company Dollar Thrifty Automotive Group, Inc. (NYSE:DTG), SEC documents showed. Pentwater now holds a stake of 11 percent in the Tulsa-based company.
Brokerage Upgrades and Downgrades on Friday, June 22, 2012
- Corning Incorporated (NYSE:GLW) was upgraded to “neutral” from “underweight” at JPMorgan Chase.
- Domino’s Pizza, Inc. (NYSE:DPZ) was raised to “buy” from “hold” by analysts at Canaccord Genuity.
- Kimberly Clark Corp (NYSE:KMB) was lifted to “buy” from “neutral” at Argus with a price target of $92.
- The Pep Boys-Manny, Moe & Jack (NYSE:PBY) was upgraded to “buy” from “sell” by analysts at Argus with a target price of $12.
- SUPERVALU INC. (NYSE:SVU) was raised to “neutral” from “sell” at Northcoast Research.
- SXC Health Solutions Corp. (USA) (NASDAQ:SXCI) was lifted to “outperform” from “neutral” by analysts at Credit Suisse with a target price of $109.
- The Fresh Market Inc (NASDAQ:TFM) was upgraded to “overweight” from “neutral” at Piper Jaffray.
- Watson Pharmaceuticals, Inc. (NYSE:WPI) was raised to “outperform” from “market perform” by analysts at Bernstein.
- Arch Coal Inc (NYSE:ACI) was cut to “equal weight” from “overweight” at Johnson Rice.
- Chimera Investment Corporation (NYSE:CIM) was downgraded to “underweight” from “equal weight” by analysts at Barclays Capital.
- ITT Corporation (NYSE:ITT) was lowered to “underperform” from “market perform” at FBR Capital with a target price of $15.5
- Key Energy Services, Inc. (NYSE:KEG) was cut to “market perform” from “outperform” by analysts at FBR Capital with a target price of $9.
- Pengrowth Energy Corp (USA) (NYSE:PGH) was downgraded to “market perform” at Raymond James.
- Ryder System, Inc. (NYSE:R) was lowered to “outperform” from “strong buy” by analysts at Raymond James.
- Ryder System, Inc. (NYSE:R) was cut to “market perform” from “outperform” at Wells Fargo & Co. with a target price of $41.
- Vodafone Group Plc (ADR) (NASDAQ:VOD) was removed from the “conviction buy” list at Goldman Sachs.
