Mid-Day Update: Stocks Lower as Optimism Over Europe Slips Away; Home Prices Seen Rising

Stocks are lower at the session's half as initial optimism over progress in Europe's debt crisis crumbled amid a suggestion that the bailout fund for the continent's troubled governments would not be expanded.

U.S. indexes downshifted after a German official said the German government was opposed to the concept of combining current and permanent eruo-zone rescue funds, according to a MarketWatch report.

Investors were looking to leaders across the continent to take decisive action to resolve the ongoing debt crisis there. The European Central Bank meets Thursday, when investors are expecting interest rates to be lowered. Also, in Brussels, European leaders will meet Thursday evening and on into Friday, according to reports.

German Chancellor Angela Merkel and French President Nicolas Sarkozy are hoping to form a new treaty that would lay out tough budget rules for European Union countries. The pact would include sanctions for violators, reports say.

Shares of homebuilders are lower while MarketWatch reports that consumers are expecting home prices to rise for the first time in six months, according to a survey from mortgage company Fannie Mae.

For November, Fannie Mae said respondents see home prices edging up 0.2% over the next year. That compares with a decline of 0.3% consumers had predicted in August.

Home builders are lower:

PHM: -2.8%

RYL: -0.1%

KBH: -0.4%

TOL: -1.5%

SPF: -1.8%

In company news:

J.C. Penney Co. ( JCP ) is expected to announce Wednesday that it will pay around $38.5 million for a 16.6% stake in Martha Stewart Living Omnimedia Inc. ( MSO ), The New York Times' DealBook section reports. As part of a 10-year partnership, J.C. Penney plans to launch ministores and a revamped website focusing on the Martha Stewart brand, the article says.

Bank of America ( BAC ) CEO Brian Moynihan said that layoffs across the bank are under way as a part of its earlier announced cost-cutting plan. reports.

Talbots Inc. ( TLB ) is sharply higher as Sycamore Partners reportedly offered to acquire Talbots ( TLB ) for $3 per share, according to the Wall Street Journal in a late-Tuesday report. The story says Talbots has rebuffed efforts to discuss a transaction, according to Sycamore.

ADRs of Banco Santander ( STD ) are down while the Spanish bank sold its Columbian unit to Corpbanca (BCA). The sale is seen as a sign that new European bank requirements could force lenders to cut back on growth plans, noted Bloomberg in a report. STD was trying to plug a $7 billion capital shortfall, the report said.

Software company Basis International Ltd said a U.S. federal court in Albuquerque has granted a temporary restraining order against Research in Motion (RIMM), barring the BlackBerry maker from using Basis' BBX trademark, according to a Reuters report. The court decision bars RIM from using the BBX trademark at its Asian DevCon conference on December 7-8 in Singapore. However, late on Tuesday, RIM appeared to backtrack on using the trademark, Reuters reported.

Shares of Cenovus Energy (CVE) are down while the Canadian oil firm refiner is expecting oil production to grow 21% next year, according to a Reuters report. The refiner will spend 23% more to support that growth, the report said.

Commodities are mixed as February gold contracts are up 0.36% to $1,738 an ounce while January crude oil contacts are down 0.76% to $100.55 a barrel.

In energy ETFs, the United States Oil Fund (USO) is down 0.53% to $38.79 and the United States Natural Gas fund (UNG) is DOWN 1.6%, to $7.56.

In precious metal ETFs, the SPDR Gold Trust (GLD) is up 0.27% to $168.65. Market Vectors Gold Miners (GDX) is down 0.75% to $58.58. iShares Silver Trust (SLV) is down 0.88% to $31.65.

Here's where markets stand at mid-day:

-NYSE down 28.74 (-0.38%) to 7,510.39

-DJIA down 0.02 (-0.02%) to 12,147.21

-S&P 500 down 4.48 (-0.36%) to 1,253.99

-Nasdaq down 11.82 (-0.5%) to 2,637.75


Nikkei up 1.69%

Hang Seng up 1.58%

Shanghai Composite up 0.29%

FTSE-100 down 0.41%

DAX-30 down 0.63%


NYSE Energy down 0.89% at 12,507.23

NYSE Financial down 0.25% at 4,107.12

NYSE Health Care up 0.22% at 6,834.39

NYSE Arca Tech 100 down 0.47% at 1,104.06


(+) MSO, (+33.3%) J.C. Penney Taking Stake in Martha Stewart

(+) GALE, (+11.1%) Reports NeuVax Phase 2 Trial Data


(-) CYCC, (-8.4%) issued update on progress of ongoing clinical studies

(-) C, (-1.6%) to Cut 4,500 Jobs, Take $400 Mln Charge

(-) JAG,(-7.6%) CEO departs

(-) BTU,(-3.9%) Peabody Energy Downgraded to Neutral from Buy at Goldman Sachs

(-) VE, (-0.5%) Downgraded to Hold from Buy at Deutsche Bank

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2016 All rights reserved. Unauthorized reproduction is strictly prohibited.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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