Markets Higher, Closing News 11/8/11

After spending the middle of the day in negative territory, markets rallied on news that Italian Prime Minister, Silvio Berlusconi, agreed to step down. Despite the positive reaction, most of the on air pundits continue to focus on the uncertainties that abound in Europe and the impact of those uncertainties on worldwide markets.

Arrivederci Berlusconi…the Italian Prime Minister confirmed that he would step down after a new budget law is approved in parliament. Confidence in his abilities to solve the debt crisis facing Italy coupled with rumors about promiscuous behavior lead to a crisis of confidence in the 17-year tenured PM.

Former European Central Bank Vice President Lucas Papademos is expected to be named prime minister of an interim government; however, sources suggest that Papademos’ terms to serve are holding up the announcement.

Next guy out of a job….Penn State head football coach, Joe Paterno?  Looking likely.

An International Atomic Energy Agency report states that new evidence supports the charge that Iran has been actively acquiring the means to design an atomic bomb and that the country continues to conduct related research putting in jeopardy Tehran’s economic and diplomatic development.

Market Indices/Statistics:

  • Dow closed up 101.79 pts/+0.84% to 12,170.18
  • S&P closed up 14.80 pts/+1.17% to 1,275.92
  • Nasdaq closed up 32.24 pts/+1.20% to 2,727.49
  • 28 of the 30 Dow stocks closed higher
  • All 10 S&P 500 sectors closed up
  • Financials was the best performing sector (+1.93%); Telecom was the lowest gainer (+0.32%)
  • The VIX was down 2.37 to 27.48
  • Oil is up $1.42 to $96.94
  • Nat Gas is down $0.058 to $3.861
  • Gold is down $5.10 to $1,786.00
  • Euro vs. Dollar down $0.0001 to $1.3832
  • Dollar vs. Yen down $0.340 to $76.62

Companies in the News:

McDonald’s hit a new 52-week high today after reporting better than expected October sales. The stock did pull back off its highs and closed down .02%/-$0.02 to $94.60.

Despite reports that Hewlett Packard is considering a sale of its webOS unit valued at hundreds of millions of dollars, HPQ was the only other Dow component that finished in the red at -0.14%/-$0.04 to $27.84.

Yelp Inc., an online review site, has reportedly chosen Goldman Sachs and Citigroup as the banker to lead the company’s IPO valued at approximately $2 billion.

China’s Ministry of Commerce approved Yum!Brands bid to acquire the remaining portion of Chinese restaurant operator, Little Sheep in a deal valuing the company at $860 mil.  YUM closed up 1.83%/+$1.00 to $55.63.

Earnings:

Toyota Motor Corp traded under pressure today after posting a 32% drop in quarterly operating profit and withdrawing its full year guidance buckling under the pressure of the Thai floods and the March earthquake. TM ended down 1.33%/-$0.87 at $64.61.

Priceline traded up 8.77%/+$44.65 to $552.85 after reporting that its third-quarter earnings more than doubled on strong demand for overseas travel.

Rockwell Automation gained on positive Q4 earnings and a FY outlook that is in line with expectations.  ROK ended the day up 6.5%/+$4.52 to $74.33.

International Flavors & Fragrances was under pressure today after releasing disappointing Q3 earnings and revenue along with guidance pointing to the low end of targets. IFF closed down 10.2%/-$6.28 to $55.03.

There was a fair amount of buzz around the release of Activision Blizzard’s “New War: Call of Duty” game, dubbed by some as “the most anticipated video game in history. After the Bell, Activision released better than expected revenues and raising its FY earnings and revenue outlook boosting the stock about 3% to $14.24. By the way, if I viewed the coverage correctly, the NYSE façade is a target in the game!

Coming Wednesday:

Economic Reports:  Weekly mortgage apps at 7:00 a.m., wholesale trade at 10:00 a.m.  Earnings from:  Anheuser Busch, GM, HSBC, Macy's, Ralph Lauren, Wendy's, Cisco, Green Mountain