Mid-Day Update: Stocks Gains as European Business Sentiment Improves; Housing Starts Jump
Stocks are higher in mid-day trading as business sentiment in Europe appears to improve despite the ongoing credit crisis there. On the real estate front, new construction starts surged past expectations last month, indicating continued improvement in the housing market.
Stocks fell in the previous session after the head of the European Central Bank and regional finance ministers failed to boost confidence in the advance of a debt-fix plan.
Today, Germany's Ifo Institute index of German business confidence showed improvement in December, beating analyst expectations.
In U.S. economic data, housing starts rose to the highest rate since April of last year. The Commerce Department reported a 9.3% gain in new home construction in November to a seasonally adjusted rate of 685,000. Also, starts for multi-family residences rose 32.2% in November. A MarketWatch poll had expected an annual clip of $635,000.
In company news:
General Mills ( GIS ) is down more than 2% after reporting Q2 adjusted EPS of $0.76, matching the year-ago result and 3 cents shy of the Thomson Reuters mean analyst estimate for $0.79. Sales grew 14% to $4.62 billion. The Street looked for $4.59 billion.
AT&T Inc. ( T ) said late Monday that after a thorough review of options it has agreed with Deutsche Telekom AG to end its bid to acquire T-Mobile USA, which began in March of this year. Sprint ( S ) and its partner Clearwire ( CLWR ) were up strongly earlier on news the $39 bln acquisition of T-Mobile USA was no longer going ahead as it was stymied by antitrust concerns. S and CLWR have since either lost most of their gains or turned negative.
AstraZeneca ( AZN ) is fluctuating between positive and negative after saying it will take a pre-tax charge of $381.5 million over research-and-development expenses related to two drug studies. It now sees full-year core earnings per share in the lower half of the $7.20-to-$7.40-a-share range, owing to the charge.
Jefferies Group (JEF) was up nearly 20% as it reports Q4 EPS of $0.21, or $0.17 excluding certain accounting items, compared to $0.31 a year earlier and topping the Thomson Reuters mean analyst estimate for $0.14. Revenues were $554 million. The Street expected $562 million.
Google (GOOG), Kohlberg Kravis Roberts & Co. L.P. and Recurrent Energy today announced an investment in a portfolio of solar photovoltaic facilities serving the Sacramento Municipal Utility District. The portfolio of projects is financed with a combination of debt and equity, which includes a significant equity investment from Google in addition to equity from SunTap Energy RE, a new venture formed today by KKR to invest in solar projects in the U.S.
Shares of ConocoPhillips (COP) are higher while The Wall Street Journal reports that the U.S. Army Corps of Engineers issed a permit to the oil major to allow development of the first commercial oil well in the National Petroleum Reserve in Alaska.
Commodities are higher as February gold contracts are up $6 to $1,603 an ounce while January crude oil contacts are up $0.65 to $94.18 a barrel.
In energy ETFs, the United States Oil Fund (USO) is up 3% and the United States Natural Gas fund (UNG) is down 1%.
In precious metal ETFs, the SPDR Gold Trust (GLD) is up 1%. Market Vectors Gold Miners (GDX) is up 3%. iShares Silver Trust (SLV) is up 2%.
Here's where markets stand at mid-day:
-Dow Jones Industrial up 2.8%
-S&P 500 futures up 2.4%
-Nasdaq 100 futures up 2.7%
-Nasdaq-100 Pre-Market Indicator up 1.3%
Nikkei up 0.49%
Hang Seng up 0.60%
Shanghai Composite down 0.10%
FTSE-100 down 0.24%
DAX-30 up 0.91%
MID-DAY NYSE INDEX WATCH
NYSE Energy down 0.4% at 11,805
NYSE Financial down 0.4% at 3,910.87
NYSE Health Care down 0.22% at 6,734.97
NYSE Arca Tech 100 down 0.4% at 1,067.38
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(+) FFIV, (+7.2%) Upgraded to Outperform from Perform at Oppenheimer
(-) TRGT, (-34%) Reported Disappointing Top-Line Results for Second Phase 3
Study of TC-5214
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