Mid-Day Market Update: Crude Oil Up Over 8%; American Eagle Shares Plummet On Weak Guidance
Midway through trading Wednesday, the Dow traded up 0.41 percent to 19,200.42 while the NASDAQ declined 0.58 percent to 5,348.86. The S&P also rose, gaining 0.12 percent to 2,207.36.
Leading and Lagging Sectors
In trading on Wednesday, utilities shares fell by 1.4 percent. Meanwhile, top losers in the sector included Aqua America Inc (NYSE: WTR), down 4 percent, and PNM Resources Inc (NYSE: PNM), down 3 percent.
GoPro Inc (NASDAQ: GPRO) announced solid camera unit sales growth during the week of Black Friday, indicating restructuring efforts to trim costs and projecting strong holiday demand in the United States for its new HERO5 cameras.
GoPro announced a company-wide restructuring initiative that was expected to reduce non-GAAP operating expenses to ~$650 million next year, enabling the company to meet its target of returning to non-GAAP profitability in 2017. The initiative includes closing GoPro’s entertainment division and eliminating more than 200 full-time positions as well as the cancelation of open positions, which would shrink the company’s workforce by ~15 percent.
GoPro estimated total aggregate charges of ~$24 million–$33 million for the restructuring and expects to recognize most of the charges in Q4 of 2016.
Equities Trading UP
Superconductor Technologies, Inc. (NASDAQ: SCON) shares shot up 59 percent to $3.17 after the company disclosed that the U.S. Department of Energy has awarded the company and its partners with a $4.5 million contract to improve HTS Wire for its Next Generation Electric Machines program.
Shares of Champions Oncology Inc (NASDAQ: CSBR) got a boost, shooting up 22 percent to $2.33. Champions Oncology reported a Q2 GAAP loss of $0.05 per share on revenue of $4.5 million.
Arbutus Biopharma Corp (NASDAQ: ABUS) shares were also up, gaining 12 percent to $2.97. Chardan Capital upgraded Arbutus Biopharma from Neutral to Buy and raised the price target from $3 to $4.
Equities Trading DOWN
Arrowhead Pharmaceuticals Inc (NASDAQ: ARWR) shares dropped 67 percent to $1.45 after the company announced it was discontinuing all its clinical RNAi programs. The company also announced plans to reduce workforce by 30 percent.
Shares of Cerecor Inc (NASDAQ: CERC) were down 56 percent to $2.08 after the company reports top-line data from CERC-301. The trial failed to demonstrate efficacy on the primary endpoint.
American Eagle Outfitters (NYSE: AEO) was down, falling around 14 percent to $16.33. American Eagle posted in-line Q3 earnings. However, the company posted weak quarterly comparable sales and issued a weak outlook for the current quarter.
In commodity news, oil traded up 8.2 percent to $48.95 while gold traded down 1.50 percent to $1,172.90.
Silver traded down 1.31 percent Wednesday to $16.52, while copper rose 1.21 percent to $2.64.
European shares were higher today. The eurozone’s STOXX 600 gained 0.28 percent, the Spanish Ibex Index rose 0.14 percent, while Italy’s FTSE MIB Index surged 2.13 percent. Meanwhile the German DAX climbed 0.12 percent, and the French CAC 40 climbed 0.65 percent while U.K. shares rose 0.17 percent.
The MBA’s index of mortgage application activity declined 9.4 percent for the latest week.
Private-sector employers added 216,000 net new jobs in November, the ADP reported. However, economists were expecting a gain of 165,000.
Consumer spending increased 0.3 percent in October, versus a revised 0.7 percent growth in September. Economists were expecting a 0.5 percent gain in spending. However, personal income increased 0.6 percent in October, versus a revised 0.4 percent growth in September. Economists projected a 0.4 percent growth in income.
The Chicago PMI increased to 57.60 for November, versus a prior reading of 50.60. Economists expected a reading of 52.00.
The pending home sales index rose 0.1 percent to 110.0 in October. Economists were expecting a 0.2 percent growth.
Crude supplies dropped 900,000 barrels in the week ended November 25, the U.S. Energy Information Administration reported. Analysts were projecting a decline of 250,000 barrels. Gasoline supplies rose 2.1 million barrels, while distillate stockpiles increased 5 million barrels.
Cleveland Federal Reserve Bank President Loretta Mester will speak at 12:35 p.m. ET.
The Federal Open Market Committee will release its latest Beige Book report at 2:00 p.m. ET.
Data on farm prices for November will be released at 3:00 p.m. ET.
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