Market Overview

TGIF As Markets Rally; S&P 500 Posts Longest Weekly Loss Streak Since 2011

Share:
TGIF As Markets Rally; S&P 500 Posts Longest Weekly Loss Streak Since 2011
Related AA
London Tower Fire Fallout: Arconic Shares Dive After Company Pulls Panels From Market
Arconic Reportedly Supplied Flammable Panels to Grenfell Tower, Shares Slide

U.S. stocks rallied on Friday following positive earnings reports from several large-cap multinationals this morning on a relatively light day of market moving news.

The Dow traded higher by more than 300 points before giving back some of the gains. The S&P 500 rallied but still posted its longest weekly loss streak since August 2011.

The Commerce Department reported housing starts in September rose more than expected in August. Consumer sentiment in October also came in higher than expected.

Speaking Boston this morning, Janet Yellen's prepared speech did not discuss her views of either monetary policy or economic outlook. On Thursday, St. Louis Fed Chief James Bullard hinted that the central bank should rethink ending its bond asset purchases.

Recommended: Best And Worst ETFs Of The Week Amid Market Rebound

  • The Dow gained 1.63 percent, closing at 16,380.41.
  • The S&P 500 gained 1.29 percent, closing at 1,886.76.
  • The Nasdaq gained 0.97 percent, closing at 4,258.44.
  • Gold lost 0.24 percent, trading at $1,238.20 an ounce.
  • Oil gained 0.35 percent, trading at $82.99 a barrel.
  • Silver lost 0.90 percent, trading at $17.28 an ounce.

News Of Note

September Housing Starts rose 6.3 percent to 1.017 million (versus expectations of 1.004 million) from 0.957 million in August. Permits rose 1.5 percent to 1.018 million (versus expectations of 1.029 million) from 1.003 million in August.

October Reuters/UofM Consumer Sentiment rose to 86.4 (versus expectations of 84.4) from 84.5 in September.

The Bank of England's Chief Economist Andrew Haldane said that the central bank may be forced to maintain interest rates at 0.5 percent for longer than expected because of a concerned global economy outlook.

European Central Bank executive member Benoit Coeure said that the central bank will begin purchasing asset-back securities within a few days.

According to The Wall Street Journal, the Chinese central bank will inject up to $32.8 billion into 20 large national and regional banks.

Analyst Upgrades And Downgrades Of Note

Analysts at Nomura upgraded AK Steel Holding (NYSE: AKS) to Buy from Neutral with a price target raised to $10 from a previous $7. Shares gained 9.46 percent, closing at $6.30.

Analysts at Citigroup maintained a Neutral rating on AT&T (NYSE: T) with a price target lowered to $34 from a previous $35. Shares gained 1.31 percent, closing at $34.08.

Analysts at Macquarie maintained a Neutral rating on Alcoa (NYSE: AA) with a price target raised to $13 from a previous $11. Shares gained 6.64 percent, closing at $15.57.

Analysts at Brean Capital initiated coverage of Alibaba (NYSE: BABA) with a price target raised to $13 from a previous $11. Shares lost 1.06 percent, closing at $87.91.

Analysts at Bank of America maintained a Buy rating on CF Industries Holdings (NYSE: CF) with a price target lowered to $283 from a previous $306. Shares lost 3.50 percent, closing at $244.96.

Analysts at CRT Capital maintained a Buy rating on Delta Air Lines (NYSE: DAL) with a price target raised to $51 from a previous $47. Shares gained 3.21 percent, closing at $34.39.

Analysts at Macquarie maintained a Neutral rating on Goldman Sachs (NYSE: GS) with a price target raised to $190 from a previous $180. Also, analysts at Citigroup maintained a Neutral rating with a price target lowered to $190 from a previous $195. Finally, analysts at Keefe Bruyette & Woods upgraded shares to Outperform from Market Perform with a price target raised to $195 from a previous $173. Shares gained 2.51 percent, closing at $176.91.

Analysts at Bank of America maintained a Buy rating on Google (NASDAQ: GOOG) with a price target lowered to $600 from a previous $670. Analysts at CRT Capital maintained a Buy rating with a price target lowered to $620 from a previous $660; analysts at Macquarie maintained an Outperform rating with a price target lowered to $630 from a previous $650; analysts at Canaccord Genuity maintained a Buy rating with a price target lowered to $700 from a previous $715; and analysts at Topeka Capital maintained a Buy rating with a price target raised to $700 from a previous $657. Shares lost 2.54 percent, closing at $511.17.

Analysts at Bank of America reinstated coverage of IBM (NYSE: IBM) with a Neutral rating and $200 price target. Shares gained 1.23 percent, closing at $182.05.

Recommended: The Year-Long Chain Of Retailer Data Breaches

Analysts at Barclays initiated coverage of Signet Jewelers (NYSE: SIG) with an Overweight rating and $120 price target. Shares gained 1.50 percent, closing at $109.62.

Analysts at MLV & Co initiated coverage of Tesla Motors (NASDAQ: TSLA) with a Buy rating and $300 price target. Shares gained 0.50 percent, closing at $227.48.

Analysts at Citigroup maintained a Neutral rating on UnitedHealth Group (NYSE: UNH) with a price target raised to $86 from a previous $77; analysts at Jefferies maintained a Hold rating with a price target raised to $93 from a previous $87; and analysts at Barclays maintained an Overweight rating with a price target raised to $101 from a previous $99. Shares gained 3.27 percent, closing at $88.18.

Analysts at Canaccord Genuity initiated coverage of Zulily (NASDAQ: ZU) with a Buy rating and $45 price target. Shares lost 0.40 percent, closing at $37.30.

Equities-Specific News Of Note

A Dallas-based lab worker has been isolated on a Carnival Cruise (NYSE: CCL) for possible Ebola exposure. The company said that the passenger is in isolation despite the CDC confirming the passenger is at a very low risk of infection. Shares gained 0.66 percent, closing at $34.92.

Lamar Advertising (NASDAQ: LAMR) said that its REIT Registration Statement was declared and shareholders will vote on the plan to reorganize itself as an REIT later this month. Shares gained 0.43 percent, closing at $48.60.

Ford's (NYSE: F) market share in Europe rose 10 basis points to 7.6 percent while General Motors (NYSE: GM) saw its market share shrink 70 basis points to 7.4 percent, according to the European Automobile Manufacturers Association. Separately, General Motors announced that its General Counsel Michael Millikin will retire in early 2015. Shares gained 0.29 percent, closing at $14.02 while shares of General Motors gained 1.0 percent, closing at $30.24.

Electronic Arts (NYSE: EA) saw four of its games rank on NPD's data of top-10 selling games. Activision (NASDAQ: ATVI) saw its "Destiny" ranking as number one, while "Reaper of Souls" fell to number 10 from number two; "Call of Duty: Ghosts" dropped out of the top-10 list. NPD data also said that U.S. physical retail video games fell 36 percent year over year to $481.2 million. (Note: "Grand Theft Auto V" was launched last year, skewing the comps.) Shares of Electronic Arts gained 5.07 percent, closing at $34.28 while shares of Activision Blizzard lost 0.74 percent, closing at $18.85.

Mark Cuban tweeted that he is buying shares of Netflix (NASDAQ: NFLX) as it is undervalued relative to other technology stocks. Cuban also suggested that Netflix will be an acquisition target. Shares lost 1.27 percent, closing at $357.09.

The SEC closed an inquiry into Keurig Green Mountain (NASDAQ: GMCR) over a 2010 accounting probe with no enforcement actions levied against the company. Shares lost 0.20 percent, closing at $137.71.

Recommended: Apple, Google Lead List Of Top 10 Most Valuable Brands

China National Petroleum (NYSE: PTR) said that it may miss its profit targets this year due to the recent slump in crude prices. Shares gained 0.73 percent, closing at $121.17.

Winners Of Note

Textron (NYSE: TXT) reported its third quarter results this morning. The company earned $0.57, beating the consensus estimate of $0.52. Revenue of $3.40 billion missed the consensus estimate of $3.67 billion. Net income for the quarter rose to $159 million from $99 million in the same quarter a year ago led by an 18-percent increase in total revenue. Textron Aviation revenue nearly doubled to $1.080 billion from $593 million a year ago; Bell revenue rose to $1.182 billion from $1.162; Textron Systems revenue dipped to $358 million from $405, while Industrial revenue rose to $785 million from $711 million. Textron raised its full-year 2014 EPS guidance to $2.05 to $2.15 from prior guidance of $1.92 to $2.12. Shares gained 8.88 percent, closing at $36.65.

SunEdison (NYSE: SUNE) is in talks to invest $2 billion to build a low-cost polysilicon factory in China. The facility will have a capacity of 20,000 to 30,000 metric tons a year that can produce polysilicon for $2 per kilogram less than its rivals. Shares gained 6.81 percent, closing at $16.63.

According to Reuters, Danone has decided it wants to consider an acquisition of Mead Johnson Nutrition (NYSE: MJN). Shares of Mead Johnson hit new 52-week highs of $104.89 before closing the day at $100.23, up 9.89 percent.

Caesars Entertainment (NASDAQ: CZR) said that it will begin talks with its debt creditors. The company is hoping to achieve a sustainable credit structure that will keep the company out of the courts. Shares gained 12.70 percent, closing at $11.71.

Regeneron (NASDAQ: REGN) said in a press release that its “EYLEA® (aflibercept) Injection demonstrated a significantly greater improvement in mean change in best-corrected visual acuity (BCVA) from baseline at 52 weeks compared to both bevacizumab (Avastin® /Genentech) and ranibizumab injection (Lucentis®/Genentech), the primary endpoint of the study. The median number of injections using the protocol-specified retreatment regimen was one fewer in patients treated with EYLEA compared to bevacizumab and ranibizumab. Fewer patients in the EYLEA group received criteria-based macular laser treatments than those treated with bevacizumab and ranibizumab.” The finding occurred in a National Institutes of Health-sponsored Diabetic Retinopathy Clinical Research Network comparative effectiveness study in patients with Diabetic Macular Edema. Shares hit new 52-week highs of $376.88 before closing the day at $369.64, up 8.49 percent.

Digital Ally (NASDAQ: DGLY) said that a police department in Tennessee placed an order for the company's wearable cameras, in-car systems, motorcycle video systems and VuLink connectivity devices. Shares gained 8.79 percent, closing at $12.50.

Decliners Of Note

Cliffs Natural Resources (NYSE: CLF) said that it will take a $6-billion charge in the third quarter to write off the value of its seaborne iron ore and coal assets. The company said that its decision was because of a revised outlook for long-term commodity prices and adverse market conditions. Shares lost 8.0 percent, closing at $8.74.

Myriad Genetics (NASDAQ: MYGN) issued downside first quarter guidance. The company expects its non-GAAP EPS to be $0.25 on revenue of $168 million. The company noted that its revised estimates are due to an increase in costs and turnaround time for its myRisk Hereditary Cancer test. The company also reaffirmed its fiscal 2015 outlook of non-GAAP EPS of $1.90 to $2.00 and revenue of $800 million to $820 million. Shares lost 7.23 percent, closing at $35.03.

Urban Outfitters (NASDAQ: URBN) said last night that negative retail comps have continued. As such, the company said that it believes gross profit margin may deleverage for the third quarter at a rate higher than it experienced in the first half of the year. Shares hit new 52-week lows of $29.11 before closing the day at $29.62, down 14.29 percent.

Earnings Of Note

SunTrust (NYSE: STI) reported its third quarter results this morning. The company earned $0.81 per share, beating the consensus estimate of $0.79. Revenue of $2.0 billion missed the consensus estimate of $2.07 billion. Net income for the quarter rose to $563 million from $179 million in the same quarter a year ago, which includes a $130-million tax benefit. Net interest for the quarter rose to $1.251 billion from $1.240 billion a year ago, while non-interest income rose to $780 million from $680 million a year ago. Mortgage production income rose to $45 million from $10 million a year ago. Book value per share rose 2 percent from June to $40.85 while tangible book value per common share also rose 2 percent to $29.21. Shares gained 2.58 percent, closing at $35.84.

General Electric (NYSE: GE) reported its third quarter results this morning. The company earned $0.38 per share, beating the consensus estimate of $0.37. Revenue of $36.20 billion missed the consensus estimate of $36.79 billion. Net earnings for the quarter rose to $3.51 billion from $3.18 billion in the same quarter a year ago. Industrial segment profit grew 9 percent to $4.33 billion from $3.97 billion a year ago; GE Capital segment profit fell 22 percent to $1.49 billion (portfolio size fell $6.5 billion from last quarter to $365 billion); aviation profit rose 16 percent to $1.26 billion; Power & Water profit fell 8 percent to $1.19 billion; health care profit rose 9 percent to $727 million; oil & gas profit rose 27 percent to $660 million; transportation profit rose 12 percent to $342 million; and appliances and lighting profit rose 14 percent to $88 million. Shares gained 2.35 percent, closing at $24.82.

Recommended: Belus Capital's Brian Sozzi Previews Chipotle Mexican Grill's Q3 Results

Honeywell (NYSE: HON) reported its third quarter results this morning. The company earned $1.47 per share, beating the consensus estimate of $1.41. Revenue of $10.10 billion beat the consensus estimate of $10.06 billion. Net income for the quarter rose to $1.17 billion from $990 million in the same quarter a year ago, as the company benefited from strong organic sales growth. Aerospace profit rose to $790 million from $730 million a year ago; automation and control solutions profit rose to $583 million from $523 million; performance materials and technologies profit rose to $444 million from $413; and corporate profit worsened to a loss of $58 million from a loss of $51. Honeywell raised its full-year fiscal 2014 EPS guidance to $5.50 to $5.55 from a prior guidance of $5.45 to $5.55. Revenue guidance was raised to $40.3 billion to $40.4 billion from $40.2 billion to $40.4 billion. Shares gained 4.25 percent, closing at $90.06.

Morgan Stanley (NYSE: MS) reported its third quarter results this morning. The company earned $0.77 per share, beating the consensus estimate of $0.54. Revenue of $8.70 billion beat the consensus estimate of $8.17 billion. Net income for the quarter rose to $1.7 billion from $906 million in the same quarter a year ago as the company benefited from a discrete tax benefit of $237 million. Income from institutional securities (before taxes) rose 27 percent from a year ago to $1.23 billion; income from wealth management rose 9 percent to $836 million; and investment management income fell 8 percent to $188 million. Book value per common share at the end of the quarter rose to $34.17 from $33.46 a year ago, while tangible book value per common share rose to $29.25 from $28.51. Shares gained 2.12 percent, closing at $33.22.

Quote Of The Day

"I'm glad to have inventory issues. It shows that people want the phone." - BlackBerry CEO John Chen commenting on reports of BlackBerry Passport shortages.

Posted-In: ActivisionEarnings News Econ #s Economics After-Hours Center Markets Movers Best of Benzinga

 

Related Articles (AA + AKS)

View Comments and Join the Discussion!