Stocks are struggling to maintain a five-day streak of market gains as Wall Street trading goes back to the low-volume, up-and-downs that investors are more accustomed to during the summer months. U.S. stocks are mostly trading flat for the day, but analysts expect a minor drop-off in the coming months, and more than likely, for the third quarter unless a key catalyst emerges. Data released today also shows that the economic growth will continue to be slow as orders placed with U.S. factories grew at a smaller rate than economists had expected. Analysts expect the S&P 500 to hit firm resistance as it approaches 1,350. The U.S. dollar strengthened on news that China’s banks could be on the verge of a financial crisis of their own. Commodities also rose as oil climbed to over $97 a barrel, and energy stocks got a boost on news that a potential bidding war for Southern Union (SUG) was developing. Williams Companies (WMB) may have to raise its bid for Southern Union after Energy Transfer Equity (ETE) increased their buyout offer to $40 a share, or close to $9 billion. Gold and silver also traded higher. Gold prices regained the $1,500 level, and silver is trading above $35 an ounce.
Major U.S. Stock Indices
DJIA: 12,581.75 (-0.01 percent)
S&P 500: 1,339.39 (-0.02 percent)
NASDAQ: 2,825.78 (+0.35 percent)
Russell 2000: 841.04 (+0.12 percent)
In other news:
- Former French finance minister Christine Lagarde is expected to earn over $550,000 a year after taxes to head the International Monetary Fund. [Bloomberg]
- The World Trade Organization ruled that China hasn’t been playing fair with its trade partners of the West. China had restricted exports of nine raw materials used for technology products to the United States, European Union, and others. [NY Times]
- Many major corporations are reporting strong profits, but the economy is still struggling with high unemployment and stagnant income growth. [WSJ]
- A group comprised of Apple (AAPL), Microsoft (MSFT), Research in Motion (RIMM) and others paid $4.5 billion for over 6,000 patents from the now bankrupt Nortel Networks. Oddly enough, Google (GOOG) decided to throw spitballs and paper airplanes instead of becoming a serious bidder despite some of the patents being vital to their Android operating system. [Fortune]
- Republicans aren’t budging on tax increases and could be playing a game of chicken with Democrats as the U.S. get dangerously closer to defaulting on their debt. [Economist]
Check back for more news.