Markets

Mid-Day Update: Stocks Off Sharply After Unemployment Claims, China Trade Deficit Disappoint

Here's where markets stand at mid-day:

-NYSE up 95.56 (-1.15%) to 8,243.20

-DJIA down 163.28 (-1.34%) to 12,049.81

-S&P 500 down 17.95 (-1.36%) to 1,302.07

-Nasdaq down 41.92 (-1.54%) to 2,709.38

GLOBAL SENTIMENT

Hang Seng down 0.82%

Nikkei down 1.46%

FTSE down 1.53%

MID-DAY NYSE INDEX WATCH

NYSE Energy down 2.64% at 13,503.54

NYSE Financial down 1.71% at 5,181.10

NYSE Health Care down 0.99% at 6,734.73

NYSE Arca Tech 100 down 1.58% at 1,121.99

UPSIDE MOVERS

(+) GMCR (+32.3%), SBUX (+8.6%) in pack tie-up.

(+) HGSI (+12.7%), GSK (+0.4%) gain on FDA approval of lupus drug.

(+) FCEL (+12.8%) beats with results.

(+) CBEH (+3.6%) beats with results, guidance.

(-) SFD (-0.5%) beats with EPS.

DOWNSIDE MOVERS

(-) SCON (-11.6%) reports sales drop.

(-) JTX (-41.5%) cancels Q3 earnings due to ongoing discussions with creditors.

(-) ARYX (-54.7%) to close after FDA delays guidance for study.

(-) PEET (-12.0%) downgraded.

(-) UL (-0.9%) downgraded.

(-) GM (-2.0%) says CFO leaving.

(-) ARMH (-8.0%) subject of negative analyst note on tablets.

(-) NTAP (-6.9%) downgraded.

MARKET DIRECTION

Stocks are down sharply at mid-day as new data showed more people applied for jobless benefits than had been expected and the United States and China showed unexpected trade deficits, sending oil prices sharply lower.

Weekly jobless claims rose by a higher-than-expected 26,000 new claims to 397,000, but the four-week rolling average, which smooths out volatility, is still near a three-year low, the Labor Department reported. According to economists polled by MarketWatch, first-time claims were expected to rise to a seasonally adjusted 378,000 from last week's upwardly revised level of 371,000

The US trade deficit grew by 15.1% to $46.3 billion, which was wider than economists had predicted. Also, China posted a $7.3 billion trade deficit in February, a surprise to financial markets that had predicted a surplus. Export and import growth slowed sharply, partly due to the impact from the Chinese New Year holiday during the month. China said that its monthly exports in February grew only 2.4% from the year-earlier period, while imports rose 19.4%. The growth represented a sharp slowdown from January.

In company news:

Green Mountain Coffee Roasters ( GMCR ) is up 34% at mid-day, after Starbucks ( SBUX ) says it will produce and sell its coffee and its Tazo brand tea via GMCR's K-Cup portion packs for use in the Keurig single-cup brewing system. The move is in line with the Seattle coffee chain's strategy to expand the reach of its single-cup coffee selections. Last year, SBUX introduced Via Ready Brew single-cup coffee.

Shares of Human Genome Sciences ( HGSI ) are higher after it and GlaxoSmithKline PLC ( GSK ) said the U.S. Food and Drug Administration (FDA) approved BENLYSTA to treat adult patients with active, autoantibody-positive systemic lupus erythematosus ( SLE ) who are receiving standard therapy.

Rio Tinto is down after it raised its cash offer for Riversdale Mining to $16.50 per share, up from the $16 offered in December. The higher price is contingent on Rio gaining acceptances from holders of more than half of Riversdale shares by March 23. Rio Tinto, which extended the offer period to April 1, said it would not raise its offer in the absence of a competing offer.

Arena Pharmaceuticals (ARNA) says it was issued United States Reissue Patent No. RE42,190 with claims to methods of identifying compounds that modulate the activity of the GPR119 receptor.

Shares of Jackson Hewitt Tax (JTX) have plunged after it cancelled its earnings conference call and webcast (originally scheduled for Thursday, March 10 at 8:30 a.m. Eastern Time) in light of ongoing discussions between JTX and lenders under its senior secured credit agreement.

AOL (AOL) is lower as Reuters reports that the company will cut about 20% of its global workforce to restructure in a bid to catch up with faster moving rivals, a source close to the company said. More than 900 of the company's 5,000 workers will lose their jobs, Reuters reports. AOL will cut about 400 employees in India, outsource another 300 positions and eliminate 200 jobs in the United States, the story said.

Ingram Micro (IM) said it has been selected by privately held Acronis to sell, market and support its product suite of data backup and recovery solutions to resellers and managed service providers throughout the Americas. Under the distribution agreement, IM channel partners will have access to a wider range of data protection and business continuity programs for Acronis, which provides backup, recovery and security solutions for physical, virtual and cloud environments.

Superconductor Technologies (SCON) is down after it says it expects to mention concerns about its ability to continue as a going concern due to past losses and negative cash flow, in its upcoming annual filing. It also said Q4 sales fell to $789,000 from $2.2 million a year ago. Net loss per share was $0.11, narrower than the $0.16 loss a year ago.

In earnings news:

--Smithfield Foods (SFD) reported 2011 Q3 adjusted EPS of $0.84, up sharply from the year-ago period and handily beating the Thomson Reuters mean analyst estimate for $0.66. Sales rose 10% to $3.2 billion, in line with the Street view. The company said that even though raising costs will increase going forward, low global red meat inventories are supporting a significantly higher live hog futures curve throughout fiscal 2012.

Commodities are down. April gold contracts are down $22, or 1.53%, to $1,408 an ounce while April crude oil contacts are down 2.72%, or $2.84, at $101.51 a barrel.

In energy ETFs, the United States Oil Fund (USO) is down 2.52% to $40.99 and the United States Natural Gas fund (UNG) is down $0.28, or 2.67%, to $10.19.

In precious metal ETFs, the SPDR Gold Trust (GLD) is down 1.64% to $137.12. Market Vectors Gold Miners (GDX) is down 3.68% to $56.77. iShares Silver Trust (SLV) is down 3.52% to $34.03.

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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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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