Initial Jobless Claims – in the week ending December 3, the advance figure for seasonally adjusted initial claims was 381,000, a decrease of 23,000 from the previous week’s revised figure of 404,000. The Dow Jones Industrial Average traded to a morning high of 12195.91 before afternoon weakness reached a low of 11966.22; remaining above the 200- day simple moving average at 11944.5. The NASDAQ traded to a morning high of 2645.92 before afternoon weakness reached a low of 2592.55; failing to hold the 50- day simple moving average at 2598.5.
Asian stocks were lower on Thursday on profit-taking ahead of the settlement of a futures contract and as market players turned cautious ahead of key events in Europe. The Nikkei 225 ended the day at 8,665 – down 0.66% and the Hang Seng ended the day at 19,108 – down 0.69%. European stocks were lower on Thursday as the European Central Bank president dashed investors’ hopes that the institution would buy more government bonds. The FTSE 100 ended the day at 5,484 – down 1.14%; the DAX ended the day at 5,874 – down 2.01%; and the CAC 40 ended the day at 3,095 – down 2.53%.
The yield on the US Treasury 10-Year note rallied from morning high yield of 2.098 to an afternoon low yield of 1.969, versus its 50-day simple moving average at 2.057. Gold traded up to a high of 1760.5 the Troy ounce before weakening to an afternoon low of $1707.8, versus the 50- day simple moving average at $1707.0. Crude oil traded to a high of $101.73 per barrel before weakening to an afternoon low of $98.24. The euro versus the dollar traded between 1.3293 and 1.3456.
Energy
A subsidiary of Kansas City energy company Inergy LP (NRGY) said yesterday that it was launching an initial public offering that could bring an estimated $297.2 million in proceeds, after costs. Exxon’s (XOM) closely-watched outlook report is due out later today. Among the predictions: By 2025, natural gas will replace coal as the leading fuel for generating electricity in the U.S., and will be the world’s No. 2 fuel source overall, while global energy demand will grow 30% by 2040. Chevron (CVX) yesterday unveiled a $32.7B capital and exploratory spending program for 2012, roughly the same amount as this year. Halliburton (HAL) is resumed with a Conviction Buy at Goldman Sachs. Baker Hughes (BHI) is a Buy and rivals Rowan Cos (RDC), Noble Corp (NE), and Ensco (ESV) are all new Neutrals. Transocean (RIG) and Diamond Offshore (DO) each get started at Sell. Halliburton (HAL) is named a Long Research Tactical Idea at Morgan Stanley. Sunoco Logistics (SXL) is lowered to Neutral from Buy at Bank of America-Merrill Lynch.
Energy Select Sector SPDR (XLE) was trading at $68.63 at 4:00 PM on Thursday, down 2.79% on the day – up 0.56% year-to-date.
Materials
SunCoke Energy (SXC) is a new Outperform and $15 price objective at Oppenheimer. Antofagasta plc (ANFGY) is raised to Buy from Reduce at Nomura. In afternoon trading: Heavily Active Stocks: Shares of Alcoa (AA) are down about 3.5%. Shares of Vale SA (VALE) are down about 4%. Shares of Freeport McMoran (FCX) are down about 5%. Shares of Cemex (CX) are down about 5.25%. Shares of United States Steel (X) are down about 4.75%.
The Materials Select Sector SPDR (XLB) was trading at $33.67 at 4:00 PM on Thursday, down 3.11% on the day – down 12.34% year-to-date.
Industrials
The airline association affirmed its forecast of $6.9 billion in 2011 profit for the global industry, boosting North America’s expected contribution to $2 billion from $1.5 billion, while cutting expectations for most other regions. Boeing (BA) machinists last night ratified a landmark four-year contract extension following weeks of talks. In afternoon trading: Shares of AMR Corp. (AMR) are down about 28.75%. Shares of Pinnacle Airlines (PNCL) are down about 22%. Shares of Vestas Wind Systems (VWDRY) are down about 10.5%. Heavily Active Stocks: Shares of General Electric (GE) are down about 1.4%. Shares of Corning (GLW) are down about 1.5%.
The Industrial Select Sector SPDR (XLI) was trading at $33.21 at 4:00 PM on Thursday, down 2.47% on the day – down 4.76% year-to-date.
Consumer Discretionary
As California is poised to adopt a new round of vehicle standards designed to cut emissions and expand the market for electric vehicles, a new report finds that the state is emerging as a leader in this economic sector. J.C. Penney Co. Inc. (JCP) bought a 16.6% stake in Martha Stewart Living Omnimedia Inc. (MSO) for $38.5 million dollars, the company said yesterday. Sir Run Run Shaw, the Chairman of Television Broadcasts (TVBCF) and producer of Blade Runner, is to retire after over 40 years at Hong Kong’s biggest television company. G-III Apparel (GIII) reported FQ3 revenue of $510M and EPS of $2.16 (beating consensus by $12.5M and $0.02). The company’s guidance for FY12 is mixed (revenue of $1.25B is slightly above Street forecasts, but EPS of $2.50-$2.60 falls below a $2.80 consensus). Pacific Sunwear (PSUN) announced a deal with its landlords to close 175-200 underperforming stores and new financing from its lenders. The company also announced a Q3 loss of 10 cents (beating by $0.04) on revenue of $242M ($233M expected). Gannett (GCI) stated at a UBS conference (webcast) it’s seeing indications of improved business activity, and is comfortable with Q4 EPS estimates. Lululemon Athletica (LULU) is begun with a Buy and $60 price objective at Sterne Agee. Madison Square Garden (MSG) is moved up 180 degrees, to Overweight from Underweight at Morgan Stanley. Pacific Sunwear of California (PSUN) is raised to Neutral from Underweight at Piper Jaffray. American Axle (AXL) is Boosted to Buy from Hold at Deutsche Bank. Expedia (EXPE) gets downgraded to Neutral from Buy at Citigroup. Tesla Motors (TSLA) is moved to Underweight from Overweight at Morgan Stanley. Peugot SA (PEUGY) is cut to Neutral from Buy by BNP Paribas. Carmike Cinemas (CKEC) is cut to Below Average from Average at Caris & Company. Las Vegas Sands (LVS) is lowered to Neutral from Buy at Janney Montgomery Scott. In afternoon trading: Shares of E-Commerce Dangdang (DANG) are up about 23.75%. Shares of G III are up about 19.5%. Shares of Tesla Motors are down about 11%. Shares of Global Education (GEDU) are down about 10.25%.
The Consumer Discretionary Select Sector SPDR (XLY) was trading at $38.71 at 4:00 PM on Thursday, down 2.12% on the day – up 3.48% year-to-date.
Consumer Staples
Costco (COST) reported FQ1 EPS of $0.80 (in-line), while beating revenue by $170M. Smithfield Foods (SFD) beat estimates by 6 cents and revenue by $100M. Central European Distribution Corp (CEDC) is upgraded to Buy from Hold at Jefferies. Philip Morris International (PM) is reduced to Neutral from Buy at Nomura. In afternoon trading: Shares of Central European Distribution are up about 23.75%. Actively Traded Stocks: Shares of Wal-Mart (WMT) are down about 0.5%. Shares of Altria Group (MO) are down about 0.4%. Shares of Walgreens (WAG) are down about 0.2%. Shares of Coca Cola (KO) are up about 0.3%.
The Consumer Staples Select Sector SPDR (XLP) was trading at $31.68 at 4:00 PM on Thursday, down 1.15% on the day – up 8.09% year-to-date.
Healthcare
Boston Scientific Corp. (BSX) said yesterday the Internal Revenue Service has told the medical device maker it owes $581 million in back taxes plus interest and penalties. Anthera Pharmaceuticals (ANTH) is initiated with a Buy at Canaccord Genuity. Jazz Pharmaceuticals (JAZZ) is cut to Hold from Buy with a $40 objective at WBB Securities. Silicon Labs (SLAB): SLAB is lowered to Neutral from Buy at UBS. In afternoon trading: Shares of Alexza Pharmaceuticals (ALXA) are down about 42.75%. Shares of Affymax (AFFY) are up about 38.75%. Actively Traded Stocks: Shares of Amgen (AMGN) are up about 0.4%. Shares of Pfizer (PFE) are down about 1.2%.
The Health Care Select Sector SPDR (XLV) was trading at $33.33 at 4:00 PM on Thursday, down 1.86% on the day – up 5.81% year-to-date.
Financials
Delaware-based IPIC Group Ltd. on Wednesday withdrew its offer to buy 500 million outstanding Bank of America (BAC) shares at $6 per share, a 9 percent premium at the time of the offer. After staying silent amid all the furore surrounding MF Global’s (MFGLQ) collapse, Jon Corzine is appearing today at a House committee hearing to speak about his role in the fiasco. The biggest U.S. banks will have to end their reliance on ratings agencies to assess the risk of their assets under proposed rules aimed at weakening the influence of the agencies. Some analysts reckon the regulations could reduce the demand for the services of S&P (MHP), Moody’s (MCO) and Fitch (FMLCF). Morgan Stanley has Overweights on American Capital (AGNC) – $32 price target and MFA Financial (MFA) – $7.50 price target. It assigns Equal Weights on Hatteras Financial (HTS) – $29 price target, Annaly Capital Management (NLY) – $18 price target, Apollo Residential Mortgage (AMTG) – $16 price target, and Invesco Mortgage Capital (IVR) – $16.50. Sovran Self Storage (SSS) is a new Outperform and $48 target at Robert W. Baird. Munich Re (MURGY) gets a Buy-from-Neutral boost at UBS. Hatteras Financial (HTS) is now Neutral from Buy at Sterne Agee. In afternoon trading: Shares of Lehman Brothers (LEHMQ) are down about 19%.
The Financial Select Sector SPDR (XLF) was trading at $12.82 at 4:00 PM on Thursday, down 3.90% on the day – down 19.62% year-to-date.
Information Technology
McAfee Inc. (MFE) has laid off approximately 250 employees, or 3 percent of its work force. The U.S. Department of Justice has confirmed it is looking into an antitrust investigation of electronic book pricing. The European Union’s antitrust watchdog is investigating Cupertino-based Apple Inc. (AAPL) and five major publishers in terms of how they price and sell e-books. Fifty investors have this year used SEC rules to conceal their stakes in certain companies as they look to avoid “substantial harm” to their competitive positions. In addition to Warren Buffett when he bought IBM (IBM) shares, Ralph Whitworth used special disclosure exemptions for big investors to cloak his purchases of H-P (HPQ) stock. Alibaba is reportedly looking for up to $4B in debt financing for a deal to buy back the 40% of the company owned by Yahoo (YHOO). Ciena (CIEN) missed estimates by 4 cents, while beating revenue by $5M. THQ (THQI) warns it expects its FQ3 revenue to be roughly 25% below prior guidance of $510M-$550M, on account of weaker-than-expected sales of its uDraw graphics tablet for the Xbox 360 and PlayStation 3. SAIC (SAI) posted better-than-expected Q3 numbers while pointing to challenges ahead. TIBCO Software (TIBX) is a new Neutral and $29 target price at Mizuho. Moneygram (MGI) is a new Neutral at Goldman. Wipro (WIT) is increased to Buy from Neutral at Bank of America-Merrill Lynch. PC Mall (MALL) is moved to up Outperform from Underperform with a $7 target at Raymond James. Cree Inc (CREE) is moved to Equal Weight from Overweight at Morgan Stanley. Infosys (INFY) is now Neutral from Buy at Bank of America-Merrill Lynch. In afternoon trading: Shares of DemandTec (DMAN) are up about 56.25%. In afternoon trading: Shares of THQ are down about 34%. Shares of IPG Photonics (IPGP) are down about 10%.
The Technology Select Sector SPDR (XLK) was trading at $25.64 at 4:00 PM on Thursday, down 1.57% on the day – up 1.79% year-to-date.
Telecommunications Services
In afternoon trading: Shares of Towerstream (TWER) are down about 11.75%. Shares of TerreStar (TSTRQ) are down about 10%. Shares of Clearwire (CLWR) are down about 9.5%. Shares of Leap Wireless (LEAP) are down about 9.25%. Shares of NII Holdings (NIHD) are down about 6.25%. Shares of VimpelCom (VIP) are down about 5%. Actively Traded Stocks: Shares of Sprint Nextel (S) are down about 3.75%, while shares of AT&T (T) are down about 0.75% and shares of Verizon (VZ) are down about 0.6%. Shares of Frontier Communications (FTR) are down about 3.5%.
The NASDAQ Telecommunications Index (IXTC) was trading at $197.89 at 4:00 PM on Thursday, down 1.90% on the day – down 12.19% year-to-date.
Utilities
In afternoon trading: Actively Traded Stocks: Shares of AES Corp. (AES) are down about 2.7%. Shares of Duke Energy (DUK) are down about 0.3%. Shares of PPL Corp. (PPL) are down about 0.6%. Shares of Exelon (EXC) are down about 0.9%. Shares of Genon Energy (GEN) are down about 1%. Shares of Southern Company (SO) are down slightly. Shares of American Electric Power (AEP) are down about 03%. Shares of NRG Energy (NRG) are down about 4.1%. Shares of CenterPoint Energy (CNP) are down about 1.4%.
The Utilities Select Sector SPDR (XLU) was trading at $34.56 at 4:00 PM on Thursday, down 1.45% on the day – up 10.27% year-to-date.
STOCKS: NRGY, XOM, CVX, HAL, BHI, RDC, NE, ESV, RIG, SXL, SXC, ANFGY, AA, VALE, FCX, CX, X, BA, AMR, PNCL, VWDRY, GE, GLW, JCP, MSO, TVBCF, GIII, PSUN, GCI, LULU, MSG, AXL, EXPE, TSLA, PEUGY, CKEC, LVS, DANG, GEDU, COST, SFD, CEDC, PM, WMT, MO, WAG, KO, BSX, ANTH, JAZZ, SLAB, ALXA, AFFY, AMGN, PFE, BAC, MFGLQ, MHP, MCO, FMLCF, AGNC, MFA, HTS, NLY, AMTG, IVR, SSS, MURGY, HTS, LEHMQ, MFE, AAPL, IBM, HPQ, YHOO, CIEN, THQI, SAI, TIBX, MGI, WIT, MALL, CREE, INFY, DMAN, IPGP, TWER, TSTRQ, CLWR, LEAP, NIHD, VIP, S, T, VZ, FTR, AES, DUK, PPL, EXC, GEN, SO, AEP, NRG, CNP
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