Stocks Lower in Mid-Session Trading; Investors Seek Clear Direction

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Stocks have turned lower at mid-day after a morning of choppy trade around even, as investors weigh mixed corporate earnings, new M&A deals, copious analysis on the effects of the Federal Reserve's quantitative easing policy and the skyrocketing price of gold futures.

Topping deal news, Chevron Corp ( CVX ) is off session lows but still in the red following news the oil major plans to buy Atlas Energy Inc ( ATLS ) for $4.3 billion. Chevron will pay $43.34 a share for Atlas, which marks a 37% premium over the company's closing price Monday. The deal will bolster Chevron's stake in the Marcellus shale fields.

Elsewhere in M&A action, Lions Gate Entertainment Corp ( LGF ) is down in the first half of trading amid speculation that the studio will merge with Metro-Goldwyn-Mayer. Executives from the two companies are expected to meet within the next few days to discuss plans on how to join forces once MGM emerges from bankruptcy. MGM filed for Chapter 11 last week as it seeks to restructure $4 billion in debt.

In other corporate news, Pfizer ( PFE ) unit Wyeth won a challenge from a generic drug rival regarding the patent on the extended release version of its antidepressant Effexor in Australia, according to a Bloomberg report. A federal court judge in that country dismissed a challenge by Sigma Pharmaceuticals, Alphapharm and Generic Health, saying that Wyeth's patent is valid, the report said.

Bank of America ( BAC ) and JPMorgan Chase ( JPM ) managed to make money every day during the last quarter after doing the same thin in the first quarter of this year, reports Bloomberg, citing a regulatory filing.

Merck & Co. ( MRK ) is looking to get 25% of its annual sales from emerging markets by 2013 as booming economic growth spurs disease diagnoses and demand for treatments, reports Bloomberg. Merck already gets 18% of its sales from emerging markets. Merck is aiming to become No. 1 or No.2 in seven countries within the next five to seven years, the report said, noting that the countries of interest are China, India, South Korea, Russia Brazil, Mexico and Turkey.

FalconStore Software ( FALC ) inked a services and reseller pact with Hewlett-Packard ( HPQ ), which has sent shares in the software company up by double-digits in mid-day trading. The terms of the deal are not available. Under the agreement, FalconStore, which makes network-storage management software, will provide disaster-recovery and business-continuity products to HP.

Vodafone Group plc ( VOD ) is down after the British mobile group sold its remaining interest in Japan's Softbank Corp ( SFTBF ) for about $5 billion. Vodafone also raised its full-year earnings outlook. Vodafone expects full year operating profit to reach between 11.8 billion pounds and 12.2 billion pounds, up from its earlier projection of 11.2 billion pounds to 12.0 billion pounds.

AT&T ( T ) has cut the price of the BlackBerry Torch--the new smartphone from Research in Motion ( RIMM )--less than three months after it began selling RIM's answer to the ever-growing mobile telephone space, Bloomberg reported. AT&T is offering the phone for $99.99 with a tow-year contract, the report said. The move is another sign of the uphill battle facing Research in Motion, which led the smartphone market in its nascent stages.

In the latest earnings news:

--Dean Foods ( DF ) shares are down sharply after the company reported Q3 EPS of $0.13, below Street estimates of $0.21 per share. Sales were $3.1 billion, ahead of the analyst consensus of $3.03 billion on Thomson Reuters. Separately, the company announced that Jack Callahan, 52, will resign his role as Chief Financial Officer (CFO) to accept a similar position as CFO of another publicly traded company.

--Genomic Health Inc ( GHDX ) has increased its market value by more than a fifth after it reported a strong third quarter performance that topped the Street.

--Delta Petroleum ( DPTR ) shares are higher after the company said Q3 sales were $35.4 million and EPS were a nickel per share. That compares to $21.4 million in sales a year ago and a loss of $0.35 per share.

--EnerNOC ( ENOC ) said late Monday Q3 adjusted EPS were $1.81, above the Thomson Reuters mean estimate for $1.55. Sales were $162.8 million, above forecasts for $160.8 million. It sees Q4 adjusted EPS between loss of $0.62-$0.73 on sales of $20-$24 million. Bloomberg's mean estimate is for a loss of $0.56 per share.

Commodities are higher as December gold contracts are up $17, or 1.23%, to $1,420 an ounce while December crude contacts are up 0.10%, or $0.10, at $87.16 a barrel.

In energy ETFs, the United States Oil Fund ( USO ) is up 0.32% to $37.65 and the United States Natural Gas fund ( UNG ) is up 0.47% to $5.92.

In precious metal ETFs, the SPDR Gold Trust ( GLD ) is up 0.81% to $138.90. Market Vectors Gold Miners ( GDX ) is up 1.75% to $62.85. iShares Silver Trust ( SLV ) is up 3.35% to $28.06.



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.

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This article appears in: Investing , Commodities


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