Stocks Higher at Mid-Day as Earnings Cheer Investors Ahead of Weekend; BofA Shares Struggling
Stocks are moving higher at mid-day as investors focus on earnings reports from Google ( GOOG ) and General Electric ( GE ), which came in better than the Street had predicted. Deals rumored to be in the offing also are providing support.
In earnings, shares of General Electric are up more than 5% after the company reported Q4 EPS of $0.36 per share, four cents ahead of the analyst consensus on Thomson Reuters. Revenue was $41.4 billion, vs. expectations of $39.9 billion. GE was helped by solid performance of its finance, health care and transportation units. "Strong performance at GE Capital was also encouraging," GE CEO Jeff Immelt said in a statement.
Google is higher after CEO Eric Schmidt said he is handing over day-to-day management and his title to Larry Page, one of the two co-founders of the search-engine giant. Schmidt is remaining at Google as executive chairman and will concentrate on deal-making and other strategic initiatives. The company also reported Q4 earnings that beat analysts' estimates as optimism about the economy led companies to boost spending for online advertising.
In the latest company news:
AstraZeneca ( AZN ) advised the US Food and Drug Administration that results of its Brilinta blood thinner that concerned regulators were likely caused by high-dose aspirin, Bloomberg reports. AstraZeneca is seeking approval of Brilinta, which concerned health officials after certain participants did worse on Brilinta than people in other parts of the world.
Shares of Pep Boys - Manny, Moe & Jack ( PBY ) are up by double digits on news of a possible sale of the company. The company is considering strategic options with Bank of America. ( BAC ), according to Bloomberg.
Shares Pfizer (PFE) are tracking lower after Bloomberg reported that the world's largest drug maker extended its tender offer to acquire King Pharmaceuticals (KG) for a third time. The two firms are awaiting US regulatory approval of the deal, worth $3.6 billion, The offer, for $14.25 a share, is now due to expire at 5pm on Jan. 28. Upon approval, the acquisition will be the biggest for Pfizer since its $68 billion buy of Wyeth in 2009.
Hewlett-Packard (HPQ) shares are higher despite news yesterday that four directors are deciding not to stand for re-election at the company's next annual meeting in March. The computer company also is adding an additional seat to the board, increasing the total number to 13, as part of its efforts to "new insight and perspective" to the firm.
Royal Bank of Scotland (RBS) ADRs are up nearly 7% this morning after the Financial Times reported the bank could possibly leave the British government's asset-protection scheme by the end of 2011.
Warner Music Group (WMG) boosted its market value by a fifth out of the gate this morning on a report that it has hired Goldman Sachs Group to solicit takeover bids. Bloomberg broke the story, citing a person with knowledge of the company's plans.
Shares of Eli Lilly (LLY) are higher after the drug maker said late Thursday the FDA's Peripheral and Central Nervous System Drugs Advisory Committee decided it could not recommend approval of Amyvid based on the currently available data. Still, the committee voted unanimously to recommend approval of Amyvid conditional on a reader training program that demonstrates reader accuracy and consistency through a re-read of previously acquired scans.
Elsewhere in earnings news:
--Shares of Bank of America ( BAC ) are down in morning trade after it reported a Q4 loss as costs rose associated with refunds, litigation and write downs tied to mortgages. The bank reported a loss of $0.16, but an ex-items profit of $0.04 per share, below the Thomson Reuters mean analyst estimate for $0.14. Revenue of $22.67 billion is down from $25.4 billion a year earlier and below the Street view for $24.8 billion.
--SunTrust Banks Inc. (STI) swung to a Q4 profit of $0.23 compared to a loss of $0.64 a year earlier, topping the Street view for $0.09 a share. Total revenue rose 19% to $2.33 billion.
--First Horizon National Corp (FHN) is off nearly 4% this morning after the bank reported a $0.20 Q4 net loss due to $63 million in costs associated with leaving the Troubled Asset relief Program.
--Shares of oilfield services firm Schlumberger (SLB) were trending lower even as the company said that Q4 revenue of $9.07 billion was better than the analyst consensus of $8.7 billion on Thomson Reuters. EPS was $0.85, ahead of expectations of $0.78 per share. Also, the company's board approved a 19% increase in the companyÃ¢â¬â"¢s quarterly dividend, to 25 cents a share.
Schlumberger shares are down 2.4%, or $1.93, to $83.37.
Commodities are down. February gold contracts are down $5, or 0.38%, to $1,342 an ounce, while March crude oil contacts are down 0.54%, or $0.48, at $89.10 a barrel.
In energy ETFs, the United States Oil Fund (USO) is down 0.35% to $37.44 and the United States Natural Gas fund (UNG) is up 0.97% to $6.43.
In precious metal ETFs, the SPDR Gold Trust (GLD) is down 0.07% to $131.11. Market Vectors Gold Miners (GDX) is down 0.82% to $54.19. iShares Silver Trust (SLV) is down 0.26% to $26.78.