Stocks are lower at mid-day as the major indexes pare
prior-session gains in the face of a weak New York regional
manufacturing report and the biggest rise in three years of core
consumer prices, although overall inflation is down. The index of
builder confidence for new single-family homes also fell to its
lowest reading since Sept. 2010, missing the Street.
Mortgage applications jumped last week, but demand was driven
largely by refinancing to take advantage of falling interest rates,
the Mortgage Bankers Association reported. The group's seasonally
adjusted index of home mortgage and refinancing activity rose 13
points for the week ended June 10, the biggest gain since
Manufacturing activity deteriorated sharply in the New York
region in June, according to the Empire State manufacturing survey
released Wednesday by the New York Fed. The Empire State index fell
below zero to -7.8 in June from 11.9 in May. This is the first time
the index has been below zero since last November. The decline in
June was unexpected.
Also out this morning, U.S. consumer prices rose a seasonally
adjusted 0.2%. The consumer price index advanced despite the first
decline in energy prices in 11 months. So-called core prices, which
strip out volatile food and energy costs, increased 0.3%, the
largest one-month gain since July 2008, and stronger than
expectations. Consumer prices have risen 3.6% over the past year,
the biggest 12 month increase since October 2008.
The index of builder confidence for new single-family homes fell
3 points in June to 13, according to the National Association of
Home Builders/Wells Fargo Housing Market Index. Economists polled
by MarketWatch had expected a 16 reading.
In company news:
Johnson & Johnson (JNJ) is down after announcing this
morning that is cutting back on its heart stent business under
pressure from falling prices and rising competition. The move will
include the closing of two factories and up to 1,000 job cuts in
its Cordis heart unit. It will take a charge of up to $600 million
to cover costs.
Shares of Advanced Micro Devices (
) are down after Bloomberg reported the chip maker has approached
at least three potential candidates to take over for ousted CEO
Dirk Meyer. The overtures, so far, have been rebuffed, the report
said. Among the executives AMD approached were Oracle (ORCL)
CO-President Mark Hurd, EMC COO Pat Gelsigner and Carlyle Group
Managing Director Greg Summe, the report said, citing people
familiar with the matter.
U.S. antitrust regulators have approved a $900 million bid by
Google Inc. (GOOG) for patents owned by Nortel Networks, The Wall
Street Journal reports, citing people familiar with the matter. The
Justice Department conducted an antitrust review and concluded that
Google's ownership of the patents would not trigger significant
competitive concerns. Other bids by Apple Inc. (
) and Research in Motion (RIMM) are also under review by the
Justice Department, the WSJ says. Microsoft Corp. (MSFT), AT&T
(T) and Verizon Communications (VZ) have objected to the sale in
legal documents filed on Monday.
Shares of Chevron (
) are down even as Reuters reports that the oil major managed to
secure a shale gas exploration permit from the Bulgarian government
for exploration work at a potentially large field in the
northeastern part of that country. The permit is for five years,
the report said. The field is initially estimated with potential
reserves of between 300 billion and 1 trillion cubic metres of
Empire Resorts (
) is up after the Wall Street Journal reports that the Obama
administration removed a hurdle for Indian tribes wanting to build
casinos far from their ancestral land, setting the stage for new
development. It said the Interior Department rescinded a Bush-era
directive that said tribes could develop casinos off their
reservations only if they were within commuting distance. The
Bureau will return to a policy that considers off-reservation
casinos on a case-by-case basis, the WSJ reports. The policy shift
is poised to revive numerous plans for off-reservation casino
projects, from the Columbus River George in Oregon to the
Catskills, it said.
Shares of JPMorgan Chase (JPM) are down as TheStreet.com reports
that the bank will pay a $2 million fine for "high-pressure sales
tactics" related to a shuttered credit-protection product. The
Office of the Comptroller of the Currency levied the fine in
connection to credit protection products the bank sold through its
home lending, auto and card services divisions between January 2008
and May 2009.
Commodities are mixed. August gold contracts are up 0.16%, to
$1,527 an ounce while July crude oil contacts are down 0.93% to
$98.45 a barrel.
In energy ETFs, the United States Oil Fund (USO) is down 0.66%
to $38.84 and the United States Natural Gas fund (UNG) is down
0.64%, to $11.56.
In precious metal ETFs, the SPDR Gold Trust (
) is down 0.25% at $148.56. Market Vectors Gold Miners (GDX) is
down 1.01% to $52.85. iShares Silver Trust (SLV) is down 0.37% to