Market Overview

Markets Little Changed As Ukraine Uncertainty And Fears Persist

U.S. stocks were little changed as uncertainty in Ukraine remains with comments out of Poland's government suggesting that the likelihood of a Russian invasion of Ukraine has increased over the past day.

NATO's deputy secretary general shared similar sentiments and stated that Russia has amassed around 20,000 troops along its border with eastern Ukraine.

Meanwhile, investors were left with the fallout of two large M&A deals that fell apart. 21st Century Fox rescinded its offer to acquire Time Warner, while Sprint announced it will no longer pursue an acquisition of T-Mobile U.S.

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  • The Dow gained 0.08 percent, closing at 16,443.34.
  • The S&P 500 gained 0.00 percent, closing at 1,920.24.
  • The NASDAQ gained 0.05 percent, closing at 4,355.05.
  • Gold gained 1.78 percent, trading at $1,308.20 an ounce.
  • Oil lost 0.41 percent, trading at $96.98 a barrel.
  • Silver gained 1.27 percent, trading at $20.08 an ounce.

News Of Note

MBA Mortgage Composite Index rose 1.6 percent after declining 2.2 percent last week.

MBA Mortgage Purchase Index declined 1 percent after rising 0.2 percent last week.

MBA Mortgage Refinance Index rose 4 percent after declining 4 percent last week.

June Trade Balance improved to -$41.5 billion from -$44.7 billion in May. Imports totaled $237.4 billion while exports totaled $195.9 billion.

July Gallup US Job Creation Index rose to 28 from 27 in June.

EIA Crude Inventories declined 1.8 million, more than a decline of 1.7 million barrels expected.

EIA Gasoline Inventories declined 4.4 million barrels when a gain of 0.3 million barrels was expected.

EIA Distillates declined 1.8 million barrels when a gain of 0.9 million barrels was expected.

The U.S. Treasury plans to auction $67 billion in paper next week. $27 billion will be in three-year notes, $24 billion in 10-year notes and $16 billion in 30-year notes.

Analyst Upgrades And Downgrades Of Note

Analysts at Credit Suisse maintained an Outperform rating on AbbVie (NYSE: ABBV) with a price target raised to $63 from a previous $60. Shares lost 1.40 percent, closing at $52.05.

Analysts at Barclays maintained an Overweight rating on Activision Blizzard (NASDAQ: ATVI) with a price target raised to $27 from a previous $24. Also, analysts at Macquarie maintained an Outperform rating on Activision Blizzard with a price target raised to $26 from a previous $25. Shares hit new 52-week highs of $23.79 before closing the day at $22.95, up 2.64 percent.

Analysts at Deutsche Bank maintained a Hold rating on American International Group (NYSE: AIG) with a price target raised to $59 from a previous $58. Shares gained 0.57 percent, closing at $52.50.

Analysts at Jefferies downgraded Bloomin' Brands (NASDAQ: BLMN) to Hold from Buy with a price target lowered to $18 from a previous $26. Also, analysts at JPMorgan maintained an Overweight rating on Bloomin' Brands with a price target lowered to $18 from a previous $26. Meanwhile, analysts at Barclays also maintained an Overweight rating on Bloomin' Brands with a price target lowered to $21 from a previous $30. Shares gained 6.11 percent, closing at $15.98.

Analysts at JPMorgan maintained an Overweight rating on CVS (NYSE: CVS) with a price target raised to $91 from a previous $82. Also, analysts at Barclays maintained an Overweight rating on CVS with a price target raised to $87 from a previous $85. Shares lost 0.31 percent, closing at $77.03.

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Analysts at Citigroup maintained a Neutral rating on Coach (NYSE: COH) with a price target raised to $38 from a previous $36. Also, analysts at Macquarie maintained a Neutral rating on Coach with a price target lowered to $36 form a previous $38. Shares lost 1.96 percent, closing at $35.10.

Analysts at Global Hunter downgraded Dresser-Rand Group (NYSE: DRC) to Accumulate from Buy with a price target lowered to $68 from a previous $71. Shares lost 3.28 percent, closing at $57.80.

Analysts at Raymond James maintained an Outperform rating on EOG Resources (NYSE: EOG) with a price target raised to $133 from a previous $130. Shares lost 1.83 percent, closing at $106.64.

Analysts at Nomura maintained a Buy rating on FireEye (NASDAQ: FEYE) with a price target lowered to $48 from a previous $55. Shares lost 11.43 percent, closing at $30.78.

Analysts at Wunderlich downgraded Groupon (NASDAQ: GRPN) to Hold from Buy with a price target lowered to $6 from a previous $10. Also, analysts at Deutsche Bank maintained a Buy rating on Groupon with a price target lowered to $7 from a previous $8. Meanwhile, analysts at Credit Suisse maintained a Neutral rating on Groupon with a price target lowered to $6.50 from a previous $10. Shares lost 12.72 percent, closing at $6.17.

Analysts at JPMorgan maintained an Overweight rating on MGM Resorts (NYSE: MGM) with a price target lowered to $31 from a previous $32. Shares lost 2.86 percent, closing at $25.14.

Analysts at Credit Suisse maintained an Outperform rating on Motorola (NYSE: MSI) with a price target lowered to $65 from a previous $70. Shares lost 0.28 percent, closing at $61.21.

Analysts at Goldman Sachs downgraded Target (NYSE: TGT) to Neutral from Buy with a price target lowered to $59 from a previous $65. Also, analysts at Deutsche Bank maintained a Hold rating on Target with a price target lowered to $57 from a previous $58. Meanwhile, analysts at JPMorgan maintained a Neutral rating on Target with a price target lowered to $60 from a previous $62. Shares lost 0.12 percent, closing at $57.97.

Analysts at Pacific Crest initiated coverage of Tesla Motors (NASDAQ: TSLA) with an Outperform rating and $316 price target. Shares gained 4.38 percent, closing at $248.93.

Analysts at Nomura maintained a Buy rating on Walt Disney Company (NYSE: DIS) with a price target raised to $97 from a previous $95. Also, analysts at JPMorgan maintained an Overweight rating on Disney with a price target raised to $100 from a previous $90. Shares lost 0.18 percent, closing at $86.59.

Analysts at Barclays maintained an Overweight rating on Zillow (NASDAQ: Z) with a price target raised to $150 from a previous $115. Also, analysts at Canaccord Genuity maintained a Buy rating on Zillow with a price target raised to $150 from a previous $130. Meanwhile, analysts at Deutsche Bank maintained a Hold rating on Zillow with a price target raised to $115 from a previous $78. Shares lost 1.94 percent, closing at $138.32.

Equities-Specific News Of Note

Freeport McMoRan (NYSE: FCX) confirmed it resumed copper concentrate exports out of Indonesia with a 10,000 metric ton shipment to China. Shares lost 0.62 percent, closing at $36.70.

CVS Caremark (NYSE: CVS) noted during its quarterly conference call that its decision to exit the tobacco business resulted in a 110 bps decline in front of store comp sales during the quarter. The company also said it expects to lose out on $2 billion in annual sales from lost tobacco sales. Shares lost 0.31 percent, closing at $77.03.

WebMD (NASDAQ: WBMD) plans to tend up to two million shares of its common stock at a price of $48.50 per share. Shares gained 2.25 percent, closing at $49.03.

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The Federal Reserve approved Bank of America's (NYSE: BAC) capital plan, which will boost the quarterly dividend to $0.05 from $0.01. Separately, the bank appears to be near a $16 billion to $17 billion settlement with the U.S. Department of Justice. Shares gained 1.33 percent, closing at $15.20.

According to the New York Times, Kellogg (NYSE: K) is considering a two billion pound offer for U.K. based United Biscuits. Shares of Kellogg gained 2.25 percent, closing at $62.78.

3D Systems (NYSE: DDD) has acquired Laser Reproductions, a 3D printing service bureau that targets industrial design firms for an undisclosed sum. Shares gained 1.92 percent, closing at $47.79.

Google (NASDAQ: GOOG) acquired Emu, a mobile messaging app that integrates a virtual assistant service. Shares gained 0.23 percent, closing at $566.37.

Amazon.com (NASDAQ: AMZN) added New York City, Philadelphia, Baltimore, Dallas, Indianapolis and Washington D.C. to metro areas where it will offer same-day delivery for more than one million items. Prime subscribers will pay a flat fee of $5.99 for a same-day order, while non-Prime subscribers will pay $9.98 for the first item and $0.99 for each additional item. Shares gained 0.50 percent, closing at $313.89.

American International Group (NYSE: AIG) has agreed to acquire Ageas Protect, a U.K. life protection carrier, for $305 million. Shares gained 0.57 percent, closing at $52.50.

Winners Of Note

This morning, Tim Hortons (NYSE: THI) reported its second quarter results. The company announced an EPS of $0.92, beating the consensus estimate of $0.86. Revenue of C$874.3 million beat the consensus estimate of C$839.70 million. Net income for the quarter slightly rose to C$123.8 million from C$123.7 million in the same quarter a year ago as the company saw same-store sales growth of 5.9 percent in the U.S. and 2.6 percent growth in Canada. Total revenue in Canada rose to C$721.6 million from C$657.68 million a year ago, while U.S. sales rose to C$51.88 million from C$41.22 million a year ago. Operating income in Canada grew 8.1 percent to C$188.9 million, while operating income in the U.S. improved to $9.3 million from $6.7 million a year ago Shares gained 7.90 percent, closing at $59.12.

According to The Wall Street Journal, Tibco Software (NASDAQ: TIBX) is reaching out to potential buyers and is in early stage talks. Shares gained 7.51 percent, closing at $20.75.

Decliners Of Note

This morning, Time Warner (NYSE: TWX) reported its second quarter results. The company announced an EPS of $0.98, beating the consensus estimate of $0.84. Revenue of $6.80 billion missed the consensus estimate of $6.87 billion. Net income for the quarter rose to $850 million from $771 million in the same quarter a year ago, as the company saw higher domestic ad rates and a strong performance from HBO. HBO subscription revenue rose 10 percent to $101 million, and content revenue rose 56 percent to $98 million. As a whole, HBO's segment revenue rose 16.5 percent to $1.42 billion; Warner Brothers segment revenue declined 2.4 percent to $2.87 billion, while Turner's segment revenue rose 4.7 percent to $2.75 billion. The company also authorized an additional $1.5 billion in share buybacks. However, investors appeared to be more focused on Tuesday's announcement that 21st Century Fox withdrew its offer to acquire Time Warner. Shares of Time Warner lost 12.85 percent, closing at $74.24.

This morning, Nu Skin Enterprises (NYSE: NUS) reported its second quarter results. The company announced an EPS of $1.13, missing the consensus estimate of $1.27. Revenue of $650 million missed the consensus estimate of $709.03 million. Net income for the quarter fell to $19.51 million from $74.44 million in the same quarter a year ago, as the company was hit by a $50 million write-down of Mainland China inventory and a $25 million charge because of transition to the SICAD II exchange rate in Venezuela. Operating margin fell 870 bps to 8.4 percent on higher expenses and issues in its China market, where revenue declined 12 percent to $229.9 million. Revenue in the Americas rose 8 percent to $89.9 million, while North Asian revenue rose 1 percent to $196.0 million and South Asia/Pacific revenue declined 5 percent to $81.7 million. Nu Skin issued guidance and sees its third quarter revenue being in a range of $620 million to $640 and its EPS being in a range of $0.90 to $0.95. The company also anticipates its fourth quarter revenue to be $650 million to $675 million and EPS being $1.00 to $1.05. Shares hit new 52-week lows of $43.50 before closing the day at $46.52, down 19.68 percent.

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Walgreens (NYSE: WAG) confirmed it will purchase the remaining 55 percent of Alliance Boots it already doesn't own. Walgreens also confirmed that their corporate headquarters will be in the Chicago area, and Alliance Boots will be run out of the United Kingdom. Walgreens stated that it will accelerate cost-reduction initiatives and sees its fiscal 2016 EPS being in a range of $4.25 to $4.60. Separately, the rating agency Moody's placed some of Walgreens' commercial paper and debt on review for a potential downgrade following the company's announcement of a new $3 billion share repurchase program. Shares lost 14.34 percent, closing at $59.21.

Last night that Sprint (NYSE: S) will scrap its plans to acquire T-Mobile U.S. (NYSE: TMUS) because of regulatory issues. At the same time, reports began to surface that Sprint will name a new CEO as early as today. This morning, Sprint confirmed that its CEO Dan Hesse will be leaving the company and will be replaced by Marcelo Claure, a member of Sprint's board and the current founder and CEO of Brightstar. Shares of Sprint hit new 52-week lows of $5.83 before closing the day at $5.90, down 18.96 percent. Shares of T-Mobile U.S. lost 8.40 percent, closing at $31.06.

Earnings Of Note

This morning, DISH Network (NASDAQ: DISH) reported its second quarter results. The company announced an EPS of $0.46, missing the consensus estimate of $0.51. Revenue of $3.69 billion was in-line with the consensus estimate. Net income for the quarter rose to $213 million from a net loss of $11 million in the same quarter a year ago, as subscriber-related revenue rose 5.6 percent to $3.65 billion. During the quarter, 656,000 gross new pay-TV subscribers were activated and the company bringing its count to 14.053 million versus 14.014 million a year ago. Pay-TV average revenue per user improved to $84.15 from $80.81 a year ago, while the churn rate declined to 1.66 percent from 1.67 percent a year ago. During the quarter, DISH added 36,000 net broadband subscribers, bringing its total subscriber base to approximately 525,000 users. Shares gained 1.71 percent, closing at $63.21.

This morning, Chesapeake Energy (NYSE: CHK) reported its second quarter results. The company announced an EPS of $0.36, missing the consensus estimate of $0.45. Revenue of $5.10 billion beat the consensus estimate of $4.76 billion. Net income for the quarter fell to $145 million from $374 million in the same quarter a year ago because of the repurchase of debt securities associated with the company's April debt refinancing. Oil and natural gas production in the quarter totaled 694,650 barrels of energy per day, which was 13 percent higher year over year. Production of natural gas liquids rose 72 percent in the quarter, but the average price the company received for natural gas declined 13 percent to $21.03 per barrel. The company raised the midpoint of its 2014 production outlook by ten thousand barrels of energy to 685,000 to 705,000 barrels of energy per day because of better production trends in the first half of 2014 and an expected increase in well connections in the second half of 2014. Shares gained 0.50 percent, closing at $26.19.

After the market closed, Keurig Green Mountain (NASDAQ: GMCR) reported its third quarter results. The company announced an EPS of $0.99, beating the consensus estimate of $0.88. Revenue of $1.02 billion missed the consensus estimate of $1.05 billion. Shares were trading lower by 3.03 percent at $114.55 following the earnings report.

After the market closed, Symantec (NASDAQ: SYMC) reported its first quarter results. The company announced an EPS of $0.45, beating the consensus estimate of $0.42. Revenue of $1.74 billion beat the consensus estimate of $1.67 billion. Shares were trading higher by 1.14 percent at $24.00 following the earnings report.

After the market closed, Prudential Financial (NYSE: PRU) reported its second quarter results. The company announced an EPS of $2.49, beating the consensus estimate of $2.35. Revenue of $11.11 billion fell short of the consensus estimate of $11.12 billion. Shares were trading flat at $86.57 following the earnings report.

Quote Of The Day

"We're not going to guess what's on Russia's mind, but we can see what Russia is doing on the ground –- and that is of great concern. Russia has amassed around 20,000 combat-ready troops on Ukraine's eastern border." -- Oana Lungescu, a NATO spokesman said on Wednesday.

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