Stocks are in mostly negative territory at mid-day as investors
tap back into a gloomy outlooking following disappointing economic
data released this morning while interest rates on mortgages fell
to a new low stirring hopes they will help the flagging real estate
A new report on prices showed almost no inflation in the economy
raises lingering concerns about deflation, which the Fed has vowed
to fight to prevent. The Producer Price Index rose a scant 0.1%
last month, excluding volatile energy and food costs.
Also the U.S. Labor Department said initial claims for
unemployment rose by 13,000 to a seasonally adjusted 462,000, the
second rise in two months. The four-week average of claims, which
smooths out volatility in the weekly numbers, rose by 2,250 to
Interest Rates on 30-year mortgages fell to an average of 4.19%,
a new low that beats rates going back decades, according to
mortgage purchaser Freddie Mac, which tracks rates. It's down from
4.27% the previous week.
In company news, shares of Apollo Group (
) continued their slide from the pre-market after the company
withdrew its forecast for fiscal 2011 citing regulatory scrutiny
and a possible 40% decline in new students, Bloomberg reported. New
student enrollment in degree programs fell to 92,000 in the fourth
quarter ended Aug. 31, from 102,000 a year earlier, Apollo said in
a statement yesterday.
EMC Corp (
) is surging amid speculation that it could be bought out by Oracle
). Neither company has commented on the rumor, but many analysts
note that Oracle has been interested in buying out the data storage
system maker for some time.
) reportedly hired Goldman Sachs (
) to help defend against possible takeover approaches, Bloomberg
reported, citing three people familiar with the matter. Yahoo
shares have traded higher following a Wall Street Journal report
that AOL (
) and several private equity firms are considering a potential
takeover bid. Yahoo is seen as "more valuable to a financial buyer
able to unlock the value of the assets in a private setting," said
Youssef Squali, an analyst at Jefferies, as quoted by
Citigroup Inc (
) is falling along with other major banks, including Wells Fargo
& Co (
) and Bank of America Corp. (
), amid concerns about foreclosure halts. FBR Capital Markets'
analyst Paul Miller cautioned that the banking industry could lose
between $1 billion and $10 billion on foreclosure-related costs. On
Wednesday, all 50 U.S. states launched a joint investigation of the
mortgage industry which may slow down sales of foreclosed homes and
in turn hurt the housing market.
Elsewhere in the financial sector, UBS AG (
) said it will not take legal action against the company's former
executives who oversaw the bank during the financial crisis,
claiming the bank "learnt the lessons" from the credit crisis,
according to a Bloomberg report. Certain shareholder group have
urged UBS board to take legal action.
Verizon Communications Inc (
) is on the rise after its mobile unit Verizon Wireless said it
will begin selling Apple Inc's (
) iPad tablet handhelds from Oct. 28. The deal ends AT&T Inc's
) reign as the sole network provider for Apple's latest device.
Speculation abounds that the deal will be extended to Apple's
iPhones as well.
) awarded a wellwork contract to Halliburton (
) integrated services contract through ExxonMobil Iraq Ltd. for
refurbishment of wells in the West Qurna field in Southern Iraq,
according to a statement from the companies. Halliburton will
provide on-site logistics and technical support for both rigless
and rig-assisted workovers, the statement said.
Other services provided by Halliburton include provision of a
workover rig, coiled tubing, slickline services, logging,
production enhancement and well testing, the statement said.
In analyst actions:
) shares are just higher as the company was reportedly initiated
with a "buy" at Capstone. The firm has a $53 target on HP
NxStage Medical (
) shares have dropped lower following a downgrade at Rodman &
Renshaw in the pre-market session. The firm dropped its rating on
the stock to "underperform" from "market perform" and cited a
sum-of-the-parts valuation for the move. The firm placed a $15
price target on the shares.
Myriad Genetics (
) shares are on the rise following comments from an analyst who
said the company could be an acquisition target, according to a
report. Michael Yee, an analyst at RBC Capital Markets in San
Francisco, bumped his rating on the firm to "outperform."
Shares of Goodrich (
) are lower as the company is reportedly downgraded to "sell" from
"hold" at Societe Generale. The firm's price target on Goodrich
shares is unavailable.
Shares of MGM Resorts (
) are lower after the company was reportedly upgraded to
"outperform" from "market perform" at BMO Capital. The firm cited
its belief that metrics at Las Vegas are stabilizing. The firm also
said MGM has other near-term catalysts for the stock. The firm has
a price target of $18 on company shares.
Shares of TC Pipelines (
) are lower after the company was reportedly downgraded to
"underperform" from "market perform" at Wells Fargo. The firm
reportedly cited valuation as the reason for the move.
Commodities are mixed as December gold contracts rose $4, or
0.26%, to $1,374 an ounce while November crude contacts are just
lower 0.08%, or $0.05, at $82.93 a barrel.
In energy ETFs, the United States Oil Fund (
) is up 0.08% to $36.19 and the United States Natural Gas fund (
) was up 1.37% to $5.94.
In precious metal ETFs, the SPDR Gold Trust (
) is up 0.19% to $134.32. Market Vectors Gold Miners (
) is down 0.41% to $58.35. iShares Silver Trust (
) is up 1.65% to $23.88.