Stocks are mixed in mid-day trading as President Obama sends
Congress a $3.7 trillion budget for fiscal 2012 in what is viewed
to be the beginning of a protracted budget battle between the White
House and congressional Republicans. The budget allocates billions
of dollars for renewable energy and infrastructure projects, but
makes painful cuts as well, reports say.
The president's plan maintains spending on major entitlements
such as Social Security, Medicare and Medicaid. The budget includes
cuts to reduce deficits by $1.1 trillion over the 10 years while
increasing spending in areas such as education.
No major US economic reports are due out today.
In company news:
Shares of Merck & Co. (
) are down after the company said that it won the first state court
trial over its Fosamax osteoporosis drug, which was blamed for
osteonecrosis of the jaw. A jury in Atlantic City, NJ said that the
drug did no cause the 67-year-old plaintiff to develop the
condition. Merck has already won two of three cases that proceeded
to a verdict in federal court in Manhattan.
Shares of Ely Lilly (
) are flat after the Financial Times reports the drug maker is
looking to raise up to $750 million through three funds that will
share drug development costs with external researchers and venture
capitalists. The move is a part of an effort by drug companies to
discover new ways to improve high failure rates and costs of drugs,
the report said.
) is higher on its plans to partner with Samsung Electronics to
launch the Galaxy Tab 10.1, a 10.1-inch screen tablet, which will
use the NVIDIA Tegra 2 mobile super chip for its Android 3.0 user
interface. The companies have also announced that they will
collaborate on bringing a new Android-based super phone with a
dual-core CPU to consumers.
Credit Suisse Group (
) ADRs are gaining after after the company agreed to issue 6
billion Swiss francs ($6.2 billion) of contingent convertible
bonds, which will satisfy 50% of the contingent capital requirement
under proposed Swiss rules, according to media reports.
) is up after reporting that it has entered into a cooperative
research and development agreement with the National Cancer
Institute's (NCI) Cancer Therapy Evaluation Program.
Netflix (NFLX) is firmly higher after Qualcomm (QCOM) says
Android devices using the Snapdragon platform will be able stream
NFLX movies and tv shows, AP reports. It said the hardware used for
NFLX video decoding helps extend battery life and improve picture
quality, the story said.
Shares of Citigroup (C) are down after Bloomberg reports that
the bank plans to hire 20 senior corporate and investment bankers
for its European team, which the is said to have been weakened by
departures. Citi will add managing directors in London along with
bankers in Russia, Turkey and the Middle East.
Seahawk Drilling (HAWK) is sharply lower after it said it has
filed for bankruptcy protection and plans to sell its fleet of
offshore drilling rigs to Hercules Offshore (HERO) for $105
million. Hercules Offshore plans to buy Seahawk's assets with 22.3
million shares of its stock, $25 million in cash to retire Seahawk
debt and additional cash for working capital. The sale is seen
closing in Q2.
St. Joe Company (JOE) shares slip after Fairholme Capital
Management LLC's Bruce Berkowitz resigned from the company's board,
citing disagreements with other board members. He is JOE's largest
shareholder. Berkowitz and Fairholme President Charles Fernandez
also withdrew their names to be considered for election at the
company's annual shareholder meeting, according to a regulatory
Green Mountain Coffee Roasters (GMCR) is seeing its shares slide
4% as the competition in the emerging market of single-cup coffee
brewing segment becomes stiffer with the entry of coffee giant
Starbucks (SBUX), according to Reuters. Starbucks's plan to launch
its own single-serve coffee brewer, Ready Brew, will follow the end
of an agreement with Kraft (KFT). Starbucks provides coffee discs
for Kraft's Tassinmo one-cup home brewer.
General Electric Co. (GE) said late Sunday that it has agreed to
buy the well support division of U.K. engineering firm John Wood
Group PLC for around $2.8 billion in cash. GE said the deal is
expected to close later in 2011. In a separate statement, Wood
Group said net proceeds from the sale will be $2.6 billion and that
it plans to return not less than $1.7 billion to shareholders,
In earnings news;
--MGM Resorts International (MGM) is down after its narrowed Q4
loss, which topped the Street, failed to impress investors in the
face of lower revenue at most of its properties in the weak
--Shares of Valspar (VAL) are down after the company reported
its financial results for the fiscal first quarter, which saw a 2%
drop in net income. The decline was due to an acquisition charge
and higher costs, according to the company.
Commodities are higher. April gold contracts are up $4, or
0.28%, to $1,364 an ounce while March crude oil contacts are up
0.3%, or $0.27, at $85.85 a barrel.
In energy ETFs, the United States Oil Fund (USO) is up 0.64% to
$36.28 and the United States Natural Gas fund (UNG) is up 0.1% to
In precious metal ETFs, the SPDR Gold Trust (GLD) is up 0.57% to
$133.08. Market Vectors Gold Miners (GDX) is up 1.13% to $56.34.
iShares Silver Trust (SLV) is up 2.02% to $29.80.
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