The Dow Jones Industrial Average rallied today after popping up 80 points on Wednesday to 12,560, up 8.5% year to date. The NASDAQ regained 32 points to 2815 up 6.1% year to date, and then rallied about 8 points on Thursday. Initial jobless claims came in at 409,000 (down 29,000 from last week and still well above the recessionary threshold at 350,000). The 4-week moving average was 439,000 (up 1,250 from last week). Existing home sales fell 0.8% to a seasonally adjusted annual rate of 5.05 million in April. Leading Indicators declined 0.3% in April to 114.0. The Philly Fed index sank to 3.9 in May from 18.5 in April, well below expectations of an increase to 20.1.
Asian stocks were mixed with the Hang Seng up 0.7%, but with the Nikkei 225 down 0.4% to 9,621 on fears of a Japanese recession as a result of the Earthquakes, Tsunami and nuclear problems. At 7:00 AM European stocks were up with the FTSE 100 up 1.0% and the DAX and CAC 40 up 1.25%. The FTSE 100 ended the day at 5,955.99 (up 0.55%), while the DAX was up 0.75% and the CAC 40 was up 1.25%. The yield on the 10-Year yield rose to 3.120 overnight into Thursday after trading as low as 3.088 on Wednesday versus the 200-day simple moving average at 3.077.
In morning trading, the 10- Year yield rose to 3.241 before ending the day at 3.171. Comex gold rebounded by $10.80 the Troy ounce on Wednesday in an attempt to get back above the illusive $1500 level, but ended Thursday back under this key threshold. Similarly, Nymex crude oil has sloshed above $100 per barrel on Thursday morning after inventories declined more than expected on Wednesday, but also ended Thursday under this key threshold. The euro versus the dollar has rebounded but the 50-day simple moving average remains a barrier at $1.4334.
James River Coal (JRCC) is resumed with a Buy at Deutsche Bank. Natural Resource Partners (NRP) is now Buy from Neutral at UBS. PDC Energy (PETD) gets upgraded to Outperform from Neutral with a $42 target at Credit Suisse. Bristow Group (BRS) is raised to Outperform from Neutral at Credit Suisse. Chesapeake Energy (CHK) is upgraded to Buy from Neutral at Lazard. Suntech Power (STP) is downgraded by Brokerage firm Collins Stewart. In afternoon trading: Shares of Tidewater (TDW) are down about 7.5%. Shares of General Maritime (GMR) are down about 7.1%. Shares of Petroleum Development (NASDAQ: PETD) are up about 7.5%.
The Energy Select Sector SPDR (XLE) was trading at $74.72 at 4:00 PM on Thursday, up slightly on the day – up 9.48% year-to-date.
IAMGOLD (IAG) is added to the Select List at Stifel. In afternoon trading: Shares of Yongye International (YONG) are down about 16%. Shares of China Shen Zhou Mining (SHZ) are down about 9.5%. Shares of Mercer International (MERC) are up about 8.5%. Shares of China Shengda Packaging Group (CPGI) are up about 8.5%.
The Materials Select Sector SPDR (XLB) traded at $38.90 at 4:00 PM on Thursday, down slightly on the day – up 1.30% year-to-date.
GE (GE) intends to buy back $12B of its stock over the next few years in order to reduce its share count to the level it held before a $15.3B offering at the height of the financial crisis in October 2008. Deere (DE) is downgraded to Hold from Buy at Jefferies with a new target of $92. In afternoon trading: Shares of YRC Worldwide (YRCW) are down about 20.75%. Shares of TBS International (TBSI) are down about 14.5%. Shares of US Airways (LCC) are up about 6.25%. Shares of Fuel Tech (FTEK) are up about 6.25%.
The Industrial Select Sector SPDR (XLI) traded at $37.77 at 4:00 PM on Thursday, up 0.64% on the day – up 8.32% year-to-date.
Sears (SHLD) missed estimates by 17 cents as the department store made a net loss of $170M after earning a $16M profit a year earlier. The results were hurt by "unfavorable weather, economic pressures facing customers, and comparisons to the previous year's government-sponsored stimulus program relating to the purchase of appliances." Williams-Sonoma (WSM) beat estimates by 2 cents and revenue by $5.6M. Limited Brands (LTD) beat estimates by a penny with revenue in-line with estimates. OfficeMax (OMX) and Staples (SPLS) are both downgraded to Perform from Outperform at Oppenheimer. In afternoon trading: Shares of China MediaExpress Holdings (CCME) are down over 80% after receiving a letter that it was denied continued listing on Nasdaq. Shares of Buckle (BKE) are down about 12.25%. Shares of Advance Auto Parts (AAP) are down about 10.5% after missing estimates by 3 cents. Shares of Big Lots (BIG) are down about 10%. Shares of Pet Smart (PETM) are UP about 7%.
The Consumer Discretionary Select Sector SPDR (XLY) traded at $40.66 at 4:00 PM on Thursday, up 0.32% on the day – up 8.69% year-to-date.
In afternoon trading: Shares of China-Biotics (CHBT) are down about 14.5%. Shares of Yuhe International (YUII) are dowm about 6.5%. Shares of Central European Distribution (CEDC) are up about 11%. Actives: Shares of Archer Daniels Midland (ADM) are down about 0.8%. Shares of Kraft Foods (KFT) are up about 0.4%. Shares of Wal-Mart (WMT) are up about 0.5%. Shares of Procter & Gamble (PG) are down slightly. Shares of Sara Lee (SLE) are up about 0.25%.
The Consumer Staples Select Sector SPDR (XLP) traded at $32.42 at 4:00 PM on Thursday, up 0.56% on the day – up 10.61% year-to-date.
Takeda Pharmaceutical (TKPHF.PK), Japan's largest drugmaker, has agreed to acquire Switzerland's Nycomed for €9.6B ($13.6B), including €3.6B of net debt. Lab-equipment company Thermo Fisher Scientific (TMO) is a leading contender to buy privately owned Swedish allergy testing firm Phadia in a deal that could be worth up to $3B. Alkermes (ALKS) is cut to Average from Above Average at Caris & Company. In afternoon trading: Shares of Biostar Pharmaceuticals (BSPM) are down about 7.5%. Shares of Syneron Medical (ELOS) are up about 6.5%. Shares of Amarin (AMRN) are up about 6.25%. Shares of Cardiome Pharma (CRME) are up about 5%.
The Health Care Select Sector SPDR (XLV) traded at $36.34 at 4:00 PM on Thursday, down 0.22% on the day – up 15.37% year-to-date.
Shares in Glencore (GLEN) began conditional trading in London this morning after the world's largest commodities trader sold 1.14B shares to institutional investors at £5.30 ($8.60) each, raising around $10B before the exercise of an over-allotment option. The SEC is investigating computer failures at electronic marketplaces, including Nasdaq (NDAQ), to determine whether internal controls are sufficient. In afternoon trading: Shares of Green Dot (GDOT) are down about 6.2%. Actives: Shares of Bank of America (BAC) are down about 0.9%. Shares of Citigroup (C) are up slightly. Shares of Wells Fargo (WFC) are down about 1.4%. Shares of JP Morgan Chase (JPM) are down about 0.5%.
The Financial Select Sector SPDR (XLF) traded at $15.94 at 4:00 PM on Thursday, unchanged on the day – down 0.06% year-to-date.
Toshiba (TOSBF.PK) has agreed to buy smart metering company Landis+Gyr from Bayard Capital and other investors for $2.3B. Janney Montgomery Scott has new Neutrals on Cisco Systems (CSCO) - $16 price objective, F5 Networks (FFIV) - $18 price objective, Polycom (PLCM) - $61 price objective, and NetApp (NTAP) - $58 price objective. They have new Buys on Brocade Communications Systems (BRCD) - $8 price objective, Riverbed Technology (RVBD) - $45 price objective, Aruba Networks (ARUN) - $48 price obective, Juniper Networks (JNPR) - $34 price objective, and EMC Corp (EMC) - $110 price objective. Citigroup covers Teradyne (TER) and Amkor Technology (AMKR) with Buy ratings and respective price objectives of $24 and $10. Genpact (G) is a new Outperform at Oppenheimer with a $20 target. Lam Research (LRCX) is raised to Buy from Neutral at Goldman Sachs. Goldman Sachs slashes Intel (INTC) and KLA-Tencor (KLAC) to Sell from Neutral. Meanwhile Applied Materials (AMAT) moves to Neutral from Buy. LinkedIn (LNKD) shares began trading on the NYSE this morning after the business social network last night priced its IPO at $45 a share, the higher end of an increased range. The company sold 7.84M shares and raised $352.8M, with the price giving LinkedIn a market cap of $4.25B, or around 275 times its 2010 net profit of $15.4M. In afternoon trading: Shares of LinkedIn are trading near $103.00 after hitting a high of $122.70. Shares of Smart Technologies (SMT) are down about 27%.
The Technology Select Sector SPDR (XLK) traded at $26.32 at 4:00 PM on Thursday, up slightly on the day – up 4.49% year-to-date.
In afternoon trading: Actives: Shares of Sprint Nextel (S) are up about a half of a percent. Shares of Level 3 Communications (LVLT) are down about 1.6%. Shares of AT&T (T) are up about a quarter of a percent. Shares of Frontier Communications (FTR) are up about 0.7%. Shares of Verizon (VZ) are up about a quarter of a percent.
The NASDAQ Telecommunications Index (IXTC) traded at $223.57 at 4:00 PM on Thursday, up 0.42% on the day – down 0.80% year-to-date.
In afternoon trading: Actives: Shares of Duke Energy (DUK) are down about a half of a percent. Shares of AES (AES) are up about 1.1%. Shares of Genon Energy (GEN) are down about a quarter of a percent. Shares of Southern (SO) are up about 0.8%. Shares of American Electric Power (AEP) are down about 0.8%.
The Utilities Select Sector SPDR (XLU) traded at $34.17 at 4:00 PM on Thursday, up 0.23% on the day – up 9.03% year-to-date.
STOCKS: JRCC, NRP, PETD, BRS, CHK, STP, TDW, GMR, IAG, YONG, SHZ, MERC, CPGI, GE, DE, YRCW, TBSI, LCC, FTEK, SHLD, WSM, LTD, OMX, SPLS, CCME, BKE, AAP, BIG, PETM, CHBT, YUII, CEDC, ADM, KFT, WMT, PG, SLE, TKPHF, TMO, ALKS, BSPM, ELOS, AMRN, CRME, NDAQ, GDOT, BAC, C, WFC, JPM, TOSBF, CSCO, FFIV, PLCM, NTAP, BRCD, RVBD, ARUN, JNPR, EMC, TER, AMKR, G, LRCX, INTC, KLAC, AMAT, LNKD, SMT, S, LVLT, T, FTR, VZ, DUK, AES, GEN, SO, AEP
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