Markets Higher, Closing News 12/22/11

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Q3 GDP was +1.8% (+2.0% expected) vs. +2.0% for the prior quarter

Initial Jobless Claims for w/e Dec. 17 were down 4,000 to 364k (380k expected) vs. 368k (revised up from 366k) for the prior week

Market Indices/Statistics:

  • Dow closed up 61.91 pts/+0.51% to 12,169.65
  • S&P closed up 10.28 pts/+0.83% to 1,254.00
  • Nasdaq closed up 21.48 pts/+0.83% to 2,599.45
  • 23 of the 30 Dow stocks closed higher
  • 9 of the 10 S&P 500 sectors closed up
  • Financials were the biggest gainers (+2.05%);  Consumer Staples were the only decliners (-0.24%)
  • The VIX was down 0.27 to 21.16
  • Oil is up $0.73 to $99.40
  • Nat Gas is down $0.003 to $3.236
  • Gold is down $6.80 to $1,606.80
  • Euro vs. Dollar up $0.0001 to $1.3051
  • Dollar vs. Yen down $0.01 to $78.15

Companies in the News:

Juniper Networks closed up $1.30/+6.7% to $20.75 after BMO Capital raised the company to outperform citing an improvement in 1st half enterprise spending in the US and Europe.

Boeing shares got a little lift (+$0.70/+0.95% to $74.29) after AMR Corp won approval to continue operating its business as usual which includes a commitment to Boeing for the purchase of new planes.

Shares of Cobalt International Energy rose $0.55/+3.6% to $15.98 on news that the company has resumed its drilling program in the Gulf of Mexico since the drilling ban imposed after the 2010 Deepwater Horizon oil spill was lifted and Cobalt received U.S. Coast Guard and Bureau of Safety and Environmental Enforcement approvals.

Mead Johnson (-$7.72/-10.1% to $68.76) shares fell as much as 12 percent intraday following the recall of some of its Enfamil baby formula from Wal-Mart Stores Inc after the death of a Missouri infant who tested positive for Cronobacter, a bacteria that has sometimes been linked to rare illnesses in newborns and has been found in milk-based powdered baby formula.

Potash gained $2.41/+6.0% to $42.63 on an RBC upgrade to outperform and a price target increase; RBC says it believes the company is "well positioned" for a recovery in 2012 since, in their view, the company has the best portfolio of producing assets with four strategic investments.

NYSE Euronext shares rose slightly (+$0.38/+1.5% to $26.35) after the U.S. Department of Justice cleared the proposed combination between NYSE Euronext and Deutsche Borse AG. The DOJ approval is subject to the sale of a minority stake in Direct Edge Holdings, LLC by the International Securities Exchange, which is wholly owned by Eurex, the derivatives exchange of Deutsche Borse. However, reports suggest that European regulators have threatened to block the sale of NYSE Euronext’s derivatives business in Amsterdam which it has offered to do to reduce the threat of anti-competitiveness concerning the European Commission.

Akamai Technologies Inc. advanced $4.91/+18.4% to $31.63 on news that it was acquiring Cotendo Inc., a maker of mobile-network acceleration software, for about $268 million in cash. Investors are encouraged by the elimination of a tough competitor and a strengthening of Akamai’s web acceleration business.

Earnings:

American Greetings Corp. fell $3.59/21.1% to $13.39 after reporting Q3 earnings that dropped 37% as the greeting-card company's greater spending on product improvement and customer relationships masked improved sales, both in North America and internationally.  American Greetings' revenue has increased in recent quarters primarily on the strength of its international sales growth. The company reported a profit of $20.2 million, or $0.50 a share, down from $32.2 million, or $0.78, a year earlier. Revenue jumped 7.8% to $463.6 million. Analysts forecasted earnings of $0.81 on revenue of $439 million.

Bed Bath & Beyond Inc dropped $3.81/6.2% to $57.58 on slightly weaker-than-expected Q3 sales and a conservative profit outlook for the current quarter. Sales rose about 6.8 percent to $2.34 billion, but fell short of the analysts' average estimate of $2.35 billion. Q3 net earnings rose to $228.5 million, or $0.95 a  from $188.6 million, or $0.74 a share. Analysts were looking for a profit of $0.88 cents a share. For the fourth quarter, Bed Bath & Beyond sees earnings of about $1.28 to $1.33 a share. Analysts were looking for $1.30 a share.

Coming Friday:

Economic Reports:Durable Goods (+2.2% expected), Personal Income & Spending (+0.2% and +0.3% expected) at 8:30 a.m.; New Home Sales (+2.6% to 315k expected)  Earnings  None

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