Stocks End Flat on Merger Monday

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"Economic data was mostly light -- the Empire State manufacturing survey was the lone 'A-list' item, and topped expectations -- and there were no major earnings reports," stated Schaeffer's Trading Analyst Peter Bryans. Aside from a slew of M&A activity, "It was a rather slow day," with the major market indexes dancing around breakeven for most of the session. The Dow Jones Industrial Average (DJIA) ultimately resolved to the upside, though, inching 5 points higher.

Continue reading for more on today's market, including :

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The Dow Jones Industrial Average (DJI - 16,781.01) explored both sides of breakeven, but eked out a gain of 5.3 points, or less than 0.1%, by the close. Sixteen of the Dow's 30 blue chips ended higher, led by The Home Depot, Inc.'s ( HD ) 1.1% rise. UnitedHealth Group Inc. (UNH) paced the declining minority, shedding 1.5%.

The S&P 500 Index (SPX - 1,937.78) followed a similar path, settling a wishy-washy session with a gain of 1.6 points, or about 0.1%. The Nasdaq Composite (COMP - 4,321.11) fared the best of its peers, advancing 10.5 points, or 0.2%.


The CBOE Volatility Index (VIX - 12.65) spent the session comfortably higher, tacking on 0.5 point, or 3.9%, by the bell.

CLOSING SUMMARY - INDICES

CLOSING SUMMARY - NYSE AND NASDAQ

A Trader's Take :

"Futures were lower ahead of the bell, likely due to the situation in Iraq," added Bryans. "However, the S&P 500 muscled into positive territory, and the Russell 2000 Index (RUT) remains higher year-to-date."

5 Items on Our Radar Today :

  1. The International Monetary Fund (IMF) lowered its 2014 outlook for the U.S. today, saying the domestic economy will grow by 2% this year, versus earlier expectations for a 2.8% growth pace. IMF economists also expect longer-term economic growth to average around 2% for the next few years, with full employment not emerging until late 2017. (Bloomberg)
  2. It was another Merger Monday, with a handful of companies making large buyout bids. Among them: Medtronic, Inc. (MDT) bid on Covidien plc (COV) for nearly $43 billion in cash and stock, while Williams Companies, Inc. (WMB) offered $6 billion to merge with Access Midstream Partners LP (ACMP) (The Boston Globe; Bloomberg)
  3. Industrial production rose by a better-than-expected 0.6% last month after edging 0.3% lower in April, the Federal Reserve reported. Capacity utilization, meanwhile, hit 79.1%, its highest reading in nearly six years. In other economic news, the National Association of Home Builders/Wells Fargo homebuilder confidence index ticked 4 points higher this month to 49. Readings south of 50 indicate that the majority of builders view the current market as unfavorable (versus favorable). (USA Today; Reuters)
  4. Despite its technical travails, Cree, Inc. ( CREE ) remains a recent favorite among speculative bulls, a trend that was seen again on Friday.
  5. Amazon.com, Inc. (AMZN) suffered a price-target cut this morning, and more could be on the way, given the current analyst landscape.

For a look at today's options movers and commodities activity, head to page 2.

STOCKS - NOTABLE CALL ACTIVITY

STOCKS - NOTABLE PUT ACTIVITY

Commodities :

Oil futures pulled back from a nine-month high today, after analysts said it was unlikely that violence in Iraq would halt crude production in the region. By the close, July-dated oil gave up a penny to end at $106.90 per barrel.

On the other hand, August gold futures extended their winning streak, tacking on $1.20, or 0.1%, to finish at $1,275.30 an ounce.

SCHAEFFER'S MARKET POSTURE



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.

All Rights Reserved. Unauthorized reproduction of any SIR publication is strictly prohibited.



This article appears in: Investing , Options

Referenced Stocks: TSLA , MSFT , AAPL , CREE , HD

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