Market Wrap For December 27: Markets Quiet Before Weekend
As expected, markets were relatively quiet Friday with no economic data aside from natural gas inventory numbers. Many traders and investors are likely sitting on the sidelines until the new year.
Major indices started the day with small gains which were slowly erased throughout the day before ending almost completely flat.
- The Dow lost 0.01 percent, closing at 16,478.66.
- The S&P 500 lost 0.03 percent, closing at 1,841.41.
- The Nasdaq lost 0.25 percent, closing at 4,156.59.
- Gold gained 0.16 percent, trading at $1,215.00 an ounce.
- Oil gained 0.68 percent, trading at $100.23 a barrel.
- Silver gained 0.65 percent, trading at $20.05 an ounce.
News of Note
EIA Natural Gas Inventory declined 177 bcf which prompted oil for February delivery to trade above the $100 mark for the first time since October.
President Obama has signed into law the two year budget deal which eases spending cuts.
Holiday sales rose by 2.3 percent this year according to data from MasterCard Advisors. Jewelry and children clothing's showed strong gains. Online sales were up at a double-digit pace yielding slower mall traffic.
Turkish equities suffered from the ongoing corruption scandal engulfing the government. Prime Minster Erdogan replaced half of his cabinet with arch-loyalists. The iShares MSCI Turkey (NYSE: TUR) slumped to new 52 week lows of $43.81
As of January 12, Indonesia will no longer allow the export of raw minerals. The new law is intended to “boost the value of metal shipments by promoting domestic processing” as companies must process their ore before shipping it overseas. Companies such as Newmont Mining (NYSE: NEM) and Freeport-McMoRan (NYSE: FCX) could be affected in the coming year.
Equities-Specific News of Note
Analysts at Wedbush spoke with several Herbalife (NYSE: HLF) distributors. According to the analysts “almost all” of them noted that they haven't seen “even a slight deceleration” in sales since the launch of a major competing product, Nu Skin's (NYSE: NUS) TR90 ageLOC. Additionally, the analysts noted that the potential for share buybacks can accelerate EPS growth. The analysts hiked its price target to $90.00 from a previous $81.00 while maintaining an Outperform rating. Despite the positive nod, shares lost 0.71 percent, closing at $78.21.
Analysts at Macquarie maintained an Outperform rating on CBS Corporation (NYSE: CBS) with a $66.00 price target. The analysts noted the company's long-term growth prospects which include positive ratings and increased opportunities for ad insertions. Shares hit new 52 week highs of $63.32 before closing the day at $63.03, up 0.05 percent.
Analysts at Needham & Co. reiterated a Buy rating on Apple (NASDAQ: AAPL) with a $595.00 price target. The analysts noted that they will not raise any estimates until Apple's first quarter results which are due sometime in January. Seperately, several reports revealed that Apple has asked U.S. district judge Lucy Koh to bar sales of 20 different models of Samsung smartphones and tablets covered by last year's $1 billion judgement against the South Korean manufacturer. Shares of Apple lost 0.68 percent, closing at $560.09.
Analysts at Needham & Co. reiterated an Underperform rating on Blackberry (NASDAQ: BBRY). The analysts noted that it will take a year or two before investors can see if its CEO John Chen's plan can succeed. The analysts haven't had a price target on Blackberry since 2011. Yesterday, BlackBerry's co-founder, Mike Lazardis, completed a sale of 3.5 million shares of the company. The former co-CEO maintains a stake less than 5 percent in the firm. Shares gained 3.40 percent, closing at $7.30.
Baidu (NASDAQ: BIDU) has acquired Perfect World's (NASDAQ: PWRD) online literature business which provides Chinese e-books, comics for around $31.5 million. Shares of Baidu gained 3.88 percent, closing at $173.77. Shares of Perfect World gained 1.31 percent, closing at $17.80.
Textron (NYSE: TXT) has agreed to acquire Beechcraft in a $1.4 billion deal. Textron will add to its portfolio Beechrcraft's small propeller-driven aircrafts. Shares gained 1.19 percent,c losing at $36.63.
Winners of Note
Sprint (NYSE: S) jumped to new 52 week highs following reports that the company could potentially merge with rival T-Mobile U.S. (NYSE: TMUS) Yesterday, analysts at Wells Fargo (NYSE: WFC) noted that a potential merger could create major cost saving synergies. Shares of Sprint hit new 52 week highs of $11.47 before closing the day at $10.80, up 8.43 percent. T-Mobile U.S. also hit new 52 week highs of $34.10 before closing at $33.31, up 1.15 percent.
ANI Pharmaceuticals (NASDAQ: ANIP) surged to new 52 week highs of $23.00 following the company's acquisition of 31 generic products from Teva Pharmaceuticals. (NASDAQ: TEVA) Shares of ANI closed the day at $20.00, up 16.82 percent, while Teva gained 0.48 percent,c losing at $39.90.
WPCS International (NASDAQ: WPCS) announced last night that it will launch a bitcoin trading platform. Shares gained 66.23 percent, closing at $2.51 but traded as high as $3.40 this morning.
Barracuda Networks (NASDAQ: CUDA) was positively mentioned during a CNBC segment by analysts at BMO. The analysts noted that the company possesses “next generation technology” in protecting data. Shares hit new 52 week highs of $35.90 before closing at $35.25, up 19.53 percent.
Chinese based Kandi Technologies (NASDAQ: KNDI) surged to new 52 week highs today. The smart-car/electric vehicle maker is assumed to benefit from recent government efforts to curb on pollution. Shares hit new 52 week highs of $10.48 before closing at $10.34, up 25.93 percent.
Molycorp (NYSE: MCP) has been featured in a bullish tone on a prominent financial blog which explains the strong gains seen today absent of any fundamental news at the company. Shares gained 14.97 percent, closing at $5.53.
Decliners of Note
Analysts at Macquarie downgraded Twitter (NYSE: TWTR) to Underperform from Neutral with a $46.00 price target. The analysts noted that nothing has fundamentally changed over the last few weeks to justify a drastic rise in valuation vastly outperforming the S&P 500. Shares lost 12.99 percent, closing at $63.79.
Quote of the Day
"I think cookies are sort of the unsung sweet, you know? They're incredibly popular. But everybody thinks of cakes and pies and fancier desserts before they think cookies. A plate of cookies is a great way to end dinner and really nice to share at the holidays." - Celebrity chef Bobby Flay.
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