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Mid-Day Update: Stocks Ease From Highs; Europe, Economic Data Support

Posted
9/29/2011 12:26:00 PM
By: MT Newswires
Referenced Stocks:AMD;DFS;JNJ;MRK;RJF

Here's where markets stand at mid-day:

-NYSE up 114.51 (+1.67%) to 6,991.45

-DJIA up 167.91 (+1.52%) to 11,178.81

-S&P 500 up 12.30 (+12.31%) to 1,163.37

-Nasdaq up 4.88 (+0.18%) to 2,495.98

GLOBAL SENTIMENT

Nikkei up 1%.

Hang Seng closed.

Shanghai Composite down 1.1%.

FTSE-100 down 0.1%.

DAX-30 up 0.8%.

MID-DAY NYSE INDEX WATCH

NYSE Energy up 0.44% at 11,118.69

NYSE Financial up 0.12% at 3,947.16

NYSE Health Care up 0.25% at 6,612.73

NYSE Arca Tech 100 down 0.38% at 1,043.11

UPSIDE MOVERS

(+) NOK (+4.2%) cutting jobs.

(+) HOV (+0.8%) announces private debt exchange.

(+) AEG (+5.1%) plans to restructure.

(+) RAD (+2.5%) reports same-store sales rise.

(+) QGEN (+3.0%) gains after split analyst moves.

(+) INTC (+0.8%) follows AMD lower.

DOWNSIDE MOVERS

(-) AMD (-12.7%) warns for smaller sales growth.

(-) DVA (-7.5%) downgraded.

MARKET DIRECTION

Stocks are higher in mid-day trade, but have eased from their morning highs, after positive economic data mixed with increasing optimism over a possible resolution to the European debt crisis stokes investor sentiment for the second consecutive session.

German lawmakers essentially approved a decision in July to increase the effective lending capacity of the fund to euro440 billion ($595 billion) and gave it new powers, allowing it to buy the bonds of shaky countries or lend money to governments to head off a potential default.

U.S. real gross domestic product for the second quarter was revised to an increase of 1.3% annualized from the earlier estimate of a 1.0% rise, the Commerce Department said Thursday. Economists surveyed by MarketWatch expected second-quarter growth to be revised to a 1.2% rate.

The revision to second-quarter GDP was largely due to a pickup in construction spending and slightly faster consumer spending. A key measure of inflation was revised higher. The core personal consumption index, which excludes food and energy prices, increased 2.3% up from 2.2% reported earlier.

New applications for unemployment benefits sank by 37,000 last week to 391,000 to mark the lowest level since April, but a government official suggested the surprising drop may have stemmed from a variety of "technical" issues not captured by normal seasonal adjustments. Initial claims from two weeks ago were revised up to 428,000 from an original reading of 423,000, the Labor Department said.

In company news:

Chipmaker Advanced Micro Devices ( AMD ) shares touched a new 52-week low of $5.30, after the company reported preliminary Q3 revenue is expected to increase 4% to 6% as compared to Q211. The company previously forecasted Q3 revenue to increase 10%, plus or minus 2%, from Q211. A handful of analysts have downgraded AMD's shares this morning.

Discover Financial ( DFS ) shares are down after the company said U.S. regulators plan to bring an enforcement case over how it marketed fee-based products, reports said.

Shares of Raymond James ( RJF ) are up after Bloomberg reported that the Financial Industry Regulatory Authority, FINRA) has ordered the company to pay $1.69 million to more than 15,500 investors who were charged unfair and unreasonable commissions on securities transactions.

Merck & Co. ( MRK ) shares are higher after the company said late yesterday that it sold its 50 percent interest in the Johnson & Johnson ( JNJ ) Merck Consumer Pharmaceuticals Co. joint venture to J&J affiliates.

Shares of Family Dollar Stores (FDO) are down after Nelson Peltz, who was tipped to make a hostile offer for the company, agreed to abandon the effort, in return for a series of friendly agreements, according to The Wall Street Journal.

Research in Motion (RIMM) shares are down, while a Collins Stewart analyst, John Vinh, was quoted this morning as saying he thinks Research in Motion (RIMM) has stopped prducing its PlayBook and is looking at exiting the tablet market altogether, Barron's reports. RIM unveiled the playbook earlier this year.

Commodities are up. December gold contracts are up 0.32% to $1,623 an ounce while November crude oil contacts are up 2.59% to $83.31 a barrel.

In energy ETFs, the United States Oil Fund (USO) is up 3.04% to $32.20 and the United States Natural Gas fund (UNG) is down 1.08%, to $9.18.

In precious metal ETFs, the SPDR Gold Trust (GLD) is up 1.09% to $157.92. Market Vectors Gold Miners (GDX) is up 0.9% to $55.03. iShares Silver Trust (SLV) is up 4.02% to $30.03.