Stocks have shed modest early gains and are now lower in mid-day
trading, with blue chips leading the way, down 0.59%, after
disappointing data hit pre-market and morning sessions, and
investors awaited the latest government employment data, due
Friday, to gauge the strength of the recovery.
The Labor Department said 422,000 people nationwide requested
jobless benefits in the week ended May 28. The prior week's number
was revised up to 428,000 from an original 424,000. Economists
surveyed by MarketWatch had expected initial claims to decline to a
seasonally adjusted 418,000 in the week ended May 28. The average
of new claims over the past four weeks, considered a more accurate
measure of employment trends, fell 14,000 to 425,500, the lowest
level in more than a month.
Also, as home sales flag, the cost of a 30-year fixed mortgage
fell to the lowest level of the year at 4.55%, down from 4.60% in
the previous week, according to Freddie Mac, which tracks the
market. The cost of a 15-year fixed mortgage also declined to 3.74%
from 3.78%, also new lows for the year. The five-year
adjustable-rate mortgage was flat at 3.41%, while the one-year
adjustable-rate loan rose slightly to 3.13%.
Meanwhile, April factory orders fell 1.2% from a revised March
figure of up 3.8%. Economists were looking for a 0.8% drop,
according to Marketwatch.com. Excluding transport, new orders
slipped 0.2% in April. Shipments fell 0.2%, the first drop after
seven straight monthly gains.
In company news:
Kellogg Company (
) today announced at the Sanford Bernstein Strategic Decisions
Conference that it is reaffirming its FY 2011 guidance, with
internal sales growth guidance of 4%. The company also reaffirmed
internal operating profit guidance of flat to down 2%
year-over-year, and said it's on track for a currency-neutral
earnings per share growth in the low single-digit range.
ADRs of Novartis (
) are down after the company's Chief Executive Officer, Joe
Jimenez, said he is willing to spend $3 billion on acquisitions of
veterinary assets or consumer-health businesses to boost its
presence in those markets, Bloomberg reported. Also, the company is
also looking for acquisitions in the generic-drug, diagnostics and
biotech market, the report said.
Nordstrom (JWN) today posted a 7.4% increase in same-store May
sales versus a year ago. Preliminary total retail sales are at $796
mln, an increase of 13% compared to $705 mln last year.
Year-to-date same store sales are up 6.7% compared to the
prior-year month, while preliminary year-to-date retail sales
increased 12.2% to $3.02 bln versus last year's $2.7 bln.
Shares of Qualcomm (QCOM) are higher after reports the chipmaker
is working with Microsoft on its Windows 8 operating system. The
company's Snapdragon smart mobile processors are said to be
designed to power devices running the next version of the operating
Google (GOOG) is lower as investors continue to react to news of
Gmail hacking. Google swung to losses in the after-hours session
following the company's announcement that "hundreds" of Gmail
accounts had been hijacked through malware or "phishing" scams,
getting users to share passwords.
Shares of Bank of America (
) and Citigroup (
) are mixed after Moody's Investor Services said it may downgrade
the two banks as the debt-rating service evaluates whether the
government with cap its support of financial firms. The agency's
current ratings for the bank were based on "uplift from Moody's
systemic support assumptions that were increased during the
financial crisis," according to Bloomberg.
Commodities are down. August gold contracts are down 1.1%, to
$1,526 an ounce while July crude oil contacts are down 1.66% to
$98.64 a barrel.
In energy ETFs, the United States Oil Fund (USO) is down 1.14%
to $39.07 and the United States Natural Gas fund (UNG) is up 3.11%,
In precious metal ETFs, the SPDR Gold Trust (
) is down 0.74% at $148.80. Market Vectors Gold Miners (GDX) is
down 1.12% to $56.43. iShares Silver Trust (SLV) is down 1.45% to