Stocks Mixed to Lower as Home Construction, Financial Stocks Disappoint

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Stocks are lower at mid-day as earnings reports from several big financial sector names disappointed investors and weigh on the broader market. Adding to downward pressure was disappointing government data on U.S. home construction. Still positive earnings news from Apple ( AAPL ) and International Business Machines ( IBM ) provided some support.

In the latest economic news, construction of new U.S. homes fell 4.3% to an annualized rate of 529,000 in December, according to Commerce Department data, a sharper drop than Wall Street economists expected. But the forward-looking portion of the report showed building permits jumped 16.7% to an annualized rate of 635,000 in December - the highest level since last March - from a revised 544,000 in November.

Topping earnings news:

--Shares of Apple ( AAPL ) have backtracked from a session high of $348.60--the highest 52-week level for the stock, after reporting post-bell yesterday that Q1 net income jumped to $6 billion, or $6.43 a share, compared with net income of $3.38 billion, or $3.67 a share, last year. Revenue soared more than 70% to $26.74 billion on strong holiday sales of the iPhone and iPad. Analysts predicted EPS of $5.40 a share on revenue of $26.74 billion.

--IBM has risen throughout morning trading after reporting a Q4 profit of $4.18 a share, topping the $4.08 average estimate of analysts surveyed by Bloomberg. Full-year profit this year, excluding some costs, will be at least $13 a share.

--Shares of Goldman Sachs ( GS ) have come off session lows but remain in red after the investment bank said before the bell that Q4 sales were $8.64 billion, below the Thomson Reuters mean for $9 billion. It earned $3.79, ex items. Estimates were for $3.76 per share.

--AMR ( AMR ) says it lost $0.21 per share, less items, in Q4, better than the Thomson Reuters mean for a loss of $0.32. Sales were about $5.6 billion, above estimates for $5.56 billion.

--Wells Fargo ( WFC ) is lower as it reports Q4 earnings of $0.61 per share, matching the analyst consensus on Thomson Reuters. Revenue was $21.5 billion, vs. expectations of $20.98 billion.

--Cree (CREE) is sharply lower after the company reported Q2 revenue of $257 million, below the analyst consensus of $277 million on Thomson Reuters. EPS was $0.55, below expectations of $0.58 per share. For Q3, the company guides for revenue of $245 to $265 million and EPS of $0.38 to $0.45 per share. The Street is at $288 million in revs and earnings of $0.58 per share.

In company news:

Shares of Boston Scientific (BSX) are down after the bio tech firm announced today that it has entered into a definitive merger agreement to acquire Atritech, a privately held company based in Plymouth, Minnesota. Boston Scientific is expected to make an initial payment of $100 million, and afterward make additional potential payments of up to $275 million upon achievement of specified regulatory and revenue-based milestones through 2015.

Pfizer (PFE) shares are flat even as the drug maker inked a pact with privately-held Theraclone Sciences to discover antibodies against infectious diseases and cancer, reports Reuters. Pfizer will use Theraclone's technology test the function of tens of thousands of natural human antibodies. Theraclone will receive up to $632 million in research funding and undisclosed royalties on any products developed in the pact.

Ctigroup (C) announced today that it is appointing John Havens as president and chief operating officer as part of its plans to change the company's management structure. Havens, who has been serving as the CEO of the bank's institutional clients group, will now be responsible for Citigroup's daily operations. He will report to CEO Vikram Pandit.

Shares of Comcast (CMCSA) are higher after the cable giant said it received regulatory clearance from the Federal Communications Commission and the Department of Justice for its acquisition of NBC Universal from General Electric (GE). The joint venture will be 51% owned by Comcast, 49% owned by GE and managed by Comcast. The transaction is expected to be completed by the end of January.

J. Crew (JCG) shares are lower following news yesterday that the clothing company agreed to settle a lawsuit over its osed $3 billion takeover by private- equity firms TPG Capital and Leonard Green & Partners. J. Crew will spend another month seeking competing offers, Bloomberg noted. J. Crew will also make a $10 million payment to plaintiffs as a part of the agreement.

Shares of Occidental Petroleum (OXY) are trending higher after a Reuters report the company won a contract to develop the $10 billion Shah sour gas project belonging to Abu Dhabi National Oil. The deal could reportedly make Occidental a leader in high-sulpher gas production. ConocoPhillips (COP) had pulled out of the project last April, which left Abu Dhabi National seeking another partner.

Commodities are mixed. February gold contracts are up $3, or 0.25%, to $1,372 an ounce while February crude oil contacts are down 0.18%, or $0.16, at $91.21 a barrel.

In energy ETFs, the United States Oil Fund (USO) is up 0.18% to $38.80 and the United States Natural Gas fund (UNG) is up 2.08% to $6.12.

In precious metal ETFs, the SPDR Gold Trust (GLD) is up 0.36% to $133.91. Market Vectors Gold Miners (GDX) is down 0.5% to $55.53. iShares Silver Trust (SLV) is up 0.56% to $28.31.

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

Copyright (C) 2016 All rights reserved. Unauthorized reproduction is strictly prohibited.

This article appears in: Investing , Commodities
Referenced Symbols: AAPL , AMR , GS , IBM , WFC

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