CLARIFICATION: Home Sales, Jobless Claims Data Helps U.S. Stocks Recover Ground After China PMI Data Triggered Global Sell-off

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(In an earlier version of this story it was stated that FRX was up 23.4%, shy of year highs. It is up 3.4% and shy of year highs. The 2 figure in 23.4% should have been the opening of a bracket).

After yesterday's wild fluctuations that saw the Dow swing from an all-time high, up 150 points, to an almost triple-digit loss at the close, it was always going to be interesting to see how the market fared today. Early on, selling in U.S. stocks picked up where it left off, at least partly due to weak economic numbers in Europe and China. By midday, however, all three major U.S. equity indexes had recovered some losses, although they remain modestly in the red - as investors and traders digested more of the domestic data.

The futures market pointed a sharply lower opening for U.S. equities, as market participants weighed jobless claims and housing data that were better than expectations against an unexpected contraction of Chinese manufacturing activity. Also weighing on global sentiment was a whopping 7.32% plunge in Japan's Nikkei Index.

Stateside, data released pre-bell showed that the number of people who applied last week for unemployment benefits fell by 23,000 to a seasonally adjusted 340,000. Economists polled by MarketWatch expected new claims to decline to 343,000 from a revised 363,000 in the prior week.

News on the housing front was good as well. Single-family home sales for April weighed in at 454,000, +2.3%, trumping analyst expectations of 430,000. That was the second best showing for new home sales since the beginning of the recession. In addition, the FHFA housing price index showed that March home prices climbed 1.3%.

On a down note, HSBC reported that the flash version of its Purchasing Managers' Index for May fell to a seven-month low of 49.6, down from April's final reading of 50.4. Analysts had forecast the PMI would remain at 50.4.

News out of China set the stage for a global sell-off, as that country's PMI unexpectedly showed a contraction. The preliminary reading of 49.6 for a Purchasing Managers' Index by HSBC Holdings Plc and Markit Economics compares with a final 50.4 for April. The number was also below the 50.4 median estimate in a Bloomberg News survey of 13 analysts. A reading below 50 indicates contraction.

Overseas, Japanese equities tumbled, suffering their biggest one-day loss in more than two years. The other Asian indexes closed lower, while European markets were all lower by about 2.5% in mid-day trading.

Commodities were mixed at midday. Oil was down $1.28 per barrel at $93.00, while natural gas continued to trade with strength, up $0.017 at $4.203 per million BTUs.

Gold was up $11.90 per ounce at $1,379.30, while silver was dipping $0.227 at $22.245. Copper was up $0.093 at $3.2875.

Here's where the markets stood at mid-day:

NYSE Composite down 55.64 (-0.58%) to 9,452.40

Dow Jones Industrial Average down 5.73 (-0.04%) to 15,301.44

S&P 500 down 5.51 (-0.33%) to 1,649.84

Nasdaq Composite Index down 5.65 (-0.16%) to 3,457.65

GLOBAL SENTIMENT

Nikkei 225 Index down 7.32%.

Hang Seng Index down 2.54%.

Shanghai China Composite Index down 1.15%.

FTSE 100 down 2.4%.

DAX down 2.64%.

CAC 40 down 2.57%.

NYSE SECTOR INDICES

NYSE Energy Sector Index (^NYE) down 57.88 (-0.43%) at 13,480.08

NYSE Financial Sector Index (^NYK) down 66.41 (-1.13%) to 5,827.61

NYSE Healthcare Sector Index (^NYP) down 51.82 (-0.55%) to 9,343.39

UPSIDE MOVERS:

(+) LPS (+12.3%, hits new 52-week top) Stock jumps to new 52-week zenith of $33.40 amid media reports that the company is in talks with Fidelity National Financial ( FNF ) and Thomas H. Lee Partners, which are interested in acquiring Lender Processing. The deal is supposedly worth about $2.9 billion and would value Lender Processing shares at around $33 per share.

(+) RUE (+22.7%, hits new 52-week high) Issue surges too new 52-week high of $41.98 after company reported that it had signed a deal under which Apax Partners will purchase all outstanding RUE shares for $42 per share in cash, a transaction valued at $1.1 billion.

(+) FRX (+23.4%, shy of year highs) Shares rise after the company says Howard Solomon will retire as CEO and president effective December 31, 2013.

DOWNSIDE MOVERS:

(-) AERL (-8.9%) Shares tumble after gaming company reported Q1 net income declined 17% to $15.3 million, or $0.36 per share compared to income of $18.4 million, or $0.43 per share for Q1 2012. The company maintains its non-GAAP income guidance for the year ended December31, 2013 of $60 million to $75 million.

(-) TCL (-6.6%, hit new 52-week low) Stock plunges to new 52-week low of $6.92--the sixth consecutive day the stock is lower with a total loss of 18% since May 16th. On May 15th, the company said it would apply to the SEC to de-list its ADRs at the end of the month due to the lack of volume and liquidity. The de-listing of Tata's ADRs was encouraged by a new Indian rule that requires all listed private companies to have at least a 25% public shareholding by the end of June. The stock is expected to be removed from the NYSE on or around June 10th.

(-) ATE (-5.7%) Issue slips after the rout in the Nikkei last night. The Japanese company manufactures and sells semiconductor and component test system products.



The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

Copyright (C) 2014 MTNewswires.com. All rights reserved. Unauthorized reproduction is strictly prohibited.


This article appears in: Investing , Commodities

Referenced Stocks: FNF

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