Stocks are losing steam at mid-day, after the Dow Jones
Industrials had gain 104 points with 27 of its 30 components moving
to the upside. The initial gain came after producer price data came
in stronger than analysts had anticipated. Still, corporate
earnings for some firms - such as Dell Inc. (
) - gave investors pause and a reason to reconsider the strength of
the economic recovery.
Producer prices rose a seasonally adjusted 0.2% in July, as a
surge in tobacco prices offset a decline in energy costs, the Labor
Department said this morning. Excluding food and energy, the
so-called core PPI rose 0.4%, the largest monthly gain since
January, MarketWatch reported. Both readings were stronger than
Wall Street economists predicted. Over 12 months, producer prices
have climbed an unadjusted 7.2%.
Shares of Dell Inc. (
) are down sharply after the computer maker reported late yesterday
that Q2 non-GAAP EPS came in at $0.54 on sales of $15.7 billion.
The Street view is for EPS of 0.49 on sales of $15.76 billion. Dell
raised its non-GAAP operating income growth expectation for FY 2012
to 17% to 23% year-over-year from 12% to 18%. The company also
revised its full-year revenue-growth outlook to 1% to 5% from the
previous range of 5% to 9%.
In company news:
E*Trade Financial (
) shares are higher, after the online brokerage said July daily
Average Revenue Trades were 144,023, an 11% increase from June and
a 12% increase from the year-ago period. It ended the month with
2.8 million brokerage accounts - including 24,110 gross new
brokerage accounts and 916 net new brokerage accounts during the
Shares of Southern Union (
) are higher after Williams (
) said late Tuesday that it still wants to buy Southern Union for
$44 per share in cash. But Southern Union still backs a competing
offering from Energy Transfer Equity, Reuters reported.
Five tobacco companies including Lorillard (
), Reynolds American (RAI) and Vector Group (VGR) have filed a
lawsuit to stop an FDA regulation that requires graphic
anti-smoking warning labels to be placed on cigarette packs, The
New York Times reported. Altria (MO), the parent company of Philip
Morris, said it supported the new law and has not joined the
Shares of Kinetic Concepts (KCI) are down after Bloomberg
reported that Bain Capital had pulled out of talks with Avista
Capital Partners involving a bid for the company. Bain Capital and
Avista Capital were seeking to raise financing for a takeover offer
that would top a $5 billion bid from Apax Partners that is already
on the table.
In earnings news:
--Shares of Target (TGT) are higher after the upscale discount
retailer reported second quarter earnings per share came in at
$1.03, which was better than the analyst consensus of $0.97 a share
on Thomson Reuters. Sales were $15.9 billion, which was shy of
Street estimates of $16.1 billion. For Q3, the company expects EPS
in the range of $0.70 to $0.75 per share, vs. the Street view of
$0.71 per share. For the full year 2011, EPS is seen in the range
of $4.15 to $4.30 per share, vs. expectations of $4.12 per
--Shares of Staples Inc. (SPLS) have turned lower, down 0.63%,
after the office supply chain reported fiscal Q2 adjusted EPS came
in at $0.22 compared with $0.20 a year earlier, two cents better
than the Street view. Sales were up 5.2% to $5.82 million. The
Street looked for $5.64 million. For the fiscal year, Staples said
it expects to achieve adjusted earnings per share between $1.39 and
$1.45. Analysts are, on average, forecasting $1.36 a share on the
Commodities are higher. December gold contracts are up 0.04% to
$1,786 an ounce while September crude oil contacts are up 0.82% to
$87.41 a barrel.
In energy ETFs, the United States Oil Fund (USO) is up 0.41% to
$33.97 and the United States Natural Gas fund (UNG) is up 0.4%, to
In precious metal ETFs, the SPDR Gold Trust (GLD) is up 0.07% to
$174.04. Market Vectors Gold Miners (GDX) is up 0.32% to $60.47.
iShares Silver Trust (SLV) is down 0.26% to $38.91.
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