Mid-Day Update: Stocks Mixed as Economic Data Begets Choppy Holiday Trading
Here's where markets stand at mid-day:
-NYSE down 5.37 (-0.07%) to 7,926.40
-DJIA up 5.57 (+0.05%) to 11,565.06
-S&P 500 down 2.14 (-0.17%) to 1,256.70
-Nasdaq down 4.03 (-0.15%) to 2,663.73
Hang Seng down 0.62%
Nikkei down 0.23%
FTSE up 0.21%
MID-DAY NYSE INDEX WATCH
NYSE Energy up 0.21% at 12,368.50
NYSE Financial down 0.39% at 4,931.54
NYSE Health Care up 0.19% at 6,523.48
NYSE Arca Tech 100 down 0.30% at 1,091.06
(+) JAS (+32%) sold for $61 per share.
(+) BBBY (+6.1%) continues upside reaction to earnings, buyback.
(+) VRGY (+7.4%) gets revised $15 per share unsolicited offer from Advantest.
(+) SNIC (+25.3%) sold for $14.17 a share to Rovi.
(+) APRI (+5.4%) in deal with Bracco SpA.
(-) AIB (-15.3%) gets government cash injection.
(-) IRE (-4.7%) down as official says gov't will fund bank if private sources do not.
(-) MU (-3.5%) continues evening decline that followed disappointing earnings.
(-) TSLA (-5.2%) down as analyst coverage started at Sell.
(-) ERIC (-1.6%) downgraded.
Stocks traded near the flat line at mid-day as mixed economic data released before and after the opening bell squelched investor optimism ahead of the long holiday weekend. Still, deal news served to provide some support to stocks through the first half of trading.
This morning, the Commerce Department said new-home sales rose to a seasonally-adjusted annual rate of 290,000, from a downwardly revised 275,000 in October. The sales level missed the MarketWatch-compiled economist estimate of 295,000, and the initial government report said October sales were 283,000.
Also, a key gauge of U.S. consumer sentiment rose to 74.5 in late December from 71.6 in November, matching expectations, according to the Reuters/University of Michigan index.
Initial jobless benefits applications fell 3,000 to 420,000 in the latest period, about in line with Wall Street expectations. The less-volatile four-week average of claism rose 2,500 to 426,000. The number of people who continued to receive benefits fell 103,000 to a seasonally adjusted 4.06 million.
Meanwhile, orders for U.S.-made durable goods fell by a stronger-than-expected 1.3% in November. But some positive details emerged in the report. Excluding transportation, new orders rose 2.4%. And, core durable-goods orders, which are orders for capital goods excluding defense and aircraft, rose 2.6% in November after a 3.6% decline in October.
Lastly, personal incomes rose 0.3% in November, compared with 0.2% expected by economists. Spending gained 0.4%, while Wall Street had expected a gain of 0.5%. The report offers one of the most closely watched inflation measures. The core personal consumption expenditure price index excludes food and energy. This core gauge of inflation rose 0.1% in November, as expected by economists.
In the latest corporate news:
Shares of Sonic Solutions ( SNIC ) are off session highs but still holding sharp gains after it and Rovi Corporation ( ROVI ) announced that the two companies have signed a definitive agreement for Rovi to acquire Sonic in a stock and cash transaction. The enterprise value of the transaction is approximately $720 million and the per share value of Sonic common stock at signing of the agreement is $14.17.
Gilead Sciences ( GILD ) is off just under 1% at mid-day, after the company said it is scrapping Phase III trials of its prospective treatment for pulmonary fibrosis. Gilead last night said it was pulling the plug on ambrisentan, citing a lack of efficacy. The decision follows Monday's $225 million acquisition of Arresto Biosciences and AB0024, its lead drug candidate now in Phase I trials for patients with pulmonary fibrosis. A Gilead spokesman told Bloomberg there was no connection between the events.
Allied Irish Banks ( AIB ) is down 16%, as the Irish government seeks approval of a euro3.7 billion cash injection into the bank. The infusion of cash would leave the government with a more than 90% stake in the bank, according to the Irish Times.
Also in Ireland, ADRs of the Bank of Ireland ( IRE ) are sharply lower in the regular session--extending pre-market losses--as the Irish government said it would inject state funds into the bank if it cannot raise capital from private sources, Reuters reports.
Verigy (VRGY) shares are up 7.5%, but off a new 52-week high of $13.75 set earlier, after the company said it received a revised proposal from Advantest Corporation (ATE) for $15 per share in cash. That would value the maker of testing equipment for semiconductor manufacturers at $900 million, accord to a Bloomberg report on the matter.
Abbott Laboratories (ABT) is down fractionally returning to the red after a brief positive turn earlier, while AstraZeneca plc (AZN) continues to hold fractional gains, after the companies announced they are discontinuing efforts to develop Certriad. The investigational compound sought to combine the active ingredients from AZN's Crestor and ABT's Trilipix to treat abnormal levels of two or more lipids in the blood. The firms said there will no financial impact to their 2010 or 2011 earnings. They did, however, at one time expected $500 million in U.S. sales each year had Certriad gained the necessary approvals.
General Motors Co. (GM) has shed an opening bell loss and is in positive territory despite announcing a recall of about 100,000 vehicles to fix a rear axle problem, which could inadvertently lock, and the passenger-side airbag, which is susceptible to malfunction. The airbag recall applies to almost 96,000 Cadillac CTS models built between 2005 and 2007. About 1,300 new Cadillac Escalade, Chevrolet Avalanche 1500, Silverado 1500 and GMC Sierra 1500 vehicles may have the axle problem.
Shares of Teva Pharmaceuticals (TEVA) is spiking at mid-day up 3% and erasing an early loss following a report before the bell that a copy of the generic drug maker's best-selling multiple sclerosis drug, Copaxone, could win approval from U.S health regulators as soon as next month, reports Bloomberg, citing comments from a Bank of America Merrill Lynch analyst.
Constellation Brands (STZ) shares are higher in regular-session trading following news that it will sell 80% of its Australian and UK wine units to Champ Private Equity--an Australian-based firm--for $230 million, the company said in a statement.
Micron Technology (MU) shares are off session lows but still in firmly negative territory after the company reported first quarter results that missed the Street's estimates.
Exxon Mobil (XOM) shares are holding gains despite an earlier report that the oil major's schedule to restart a fluid catalytic cracking unit in Louisiana--which it shut down on Dec. 18--is "undetermined" according to a Bloomberg report. Still, an Exxon spokesman reportedly said that "at this time the refinery is operational and all customer needs are being met."
Jo-Ann Stores Inc. (JAS) is up near 33% in early trading, matching the premium on a $1.6 billion buyout from affiliates of private-equity firm Leonard Green & Partners. The $61-a-share offer was a 34% premium to yesterday's closing price.
Commodities are mixed. February gold contracts are down $9, or 0.63%, to $1,379 an ounce while February crude oil contacts are up 1.09%, or $0.99, at $91.47 a barrel.
In energy ETFs, the United States Oil Fund (USO) is up 0.91% to $38.99 and the United States Natural Gas fund (UNG) is down 0.18% to $5.63.
In precious metal ETFs, the SPDR Gold Trust (GLD) is down 0.39% to $134.52. Market Vectors Gold Miners (GDX) is up 1.15% to $60.12. iShares Silver Trust (SLV) is up 0.11% to $28.60.