Markets Lower, Closing News 7/20/11

Markets finished slightly lower today after yesterday’s 200 point rally, remaining tentative on a day without any real progress or news on the debt ceiling talks or any developments from Europe.


Existing home sales fell 0.8% in June, to a rate of 4.77 million, better than the -3.8% in May, but below the +2.9% that economists were expecting.  The report published by the National Association of Realtors indicated that sales were weighed down by sales declines in the Northeast and West.


The earnings story was a good one again today as all 15 companies in the S&P 500 that reported earnings today beat analysts’ expectations for earnings per share.  Today’s earnings were lead by BlackRock, PNC, and US Bancorp.


President Obama signaled today that the White House could be open to discussing a short-term increase in the U.S. debt ceiling as a way to provide congress with extra time to work out a long term solution. 


Farleigh Dickenson University released a study that MTV’s Jersey Shore does not change peoples’ views on New Jersey. 43% of the shows fans have a favorable view of the Garden State, slightly higher than the 41% favorable perception by non-viewers.   Before you come back with a snarky “Jersey stinks, only 43% have a favorable view”, only 18% of both viewers and non-viewers have a negative view of New Jersey.  The takeaway from the study for this Jersey Boy– Keep pumping those fists.


Market Indices/Statistics:



  • Dow closed down 15.51 pts/-0.12% to 12,571.981

  • S&P closed down 0.89 pts/-0.07% to 1,325.84

  • Nasdaq closed down 12.29 pts/-0.43% to 2,814.23

  • 16 of the 30 Dow stocks closed higher / 14 closed lower

  • 7 of the 10 S&P 500 sectors closed lower

  • Financials was the best performing sector (up 1.08%)

  • Consumer Discretionaries was the worst performing sector (down 0.58%)

  • The VIX was down 0.12 pts to 19.09

  • Oil is up $0.59 to $98.45

  • Nat Gas is down $0.051 to $4.460

  • Gold is down $0.50 to $1,600.00

  • Euro vs. Dollar up $0.0063 to $1.4214

  • Dollar vs. Yen down $0.38 to $78.75

Companies in the News:


Saratoga Resources Inc. (NYSE Amex: SARA), an oil and gas exploration company, traded 1.64% higher to $6.18 in their first session trading on the NYSE Amex today.


The Clorox Company confirmed receipt of a revised unsolicited proposal from Carl Icahn this afternoon.  The new offer from Icahn is for $80.00 per share, up from the original bid of $76.50 per share.  Shares of Clorox traded higher (+2.44% to $74.34) today.


Shares of Ecolab Inc. traded -7.37% lower to $51.31 today after announcing an agreement to merge with Nalco Holding Company (+24.25% to $35.87) for $38.80 per share in a deal valued at $5.4 billion.  Ecolab updated their FY guidance to $2.52-2.56 per share, ahead of the $2.51 per share that analysts were expecting.


Quepasa Corp shot higher today (+40.11% to $9.99) after announcing an agreement to purchase MyYearbook.com in a deal valued at $100 million.  The deal is comprised of $82 million in QPSA stock and approximately $18 million in cash.


Boeing traded higher today (+2.18% to $72.07) after American Airlines announced the largest aircraft order in aviation history.  The deal is for 200 narrowbody airplanes, and includes options for 100 next-generation 737s. 


Earnings:


Shares of Johnson Controls Inc. slid today (-4.38% to $39.69) after announcing Q3 earnings per share of $0.56 on revenue of $10.36 billion (both in line).  Shares were lower today because of comments made by JCI’s CFO stating that the residential business unit was much softer than expected and that margin improvement is not expected in 2011.


Altria also fell (-2.41% to $26.37) despite reporting Q2 earnings per share that were in line.  Altria reported earnings per share of $0.53, indicating that their tobacco companies will continue to face significant competitive challenges, weighing on investor sentiment today.


Hanesbrands slid today after reporting their Q2 earnings before the opening bell this morning.  HBI reported earnings per share of $0.87 on $1.23 billion revenue, in line with expectations, but said that their 3Q earnings could reach $0.81 per share which was well below the $0.91 per share that analysts were expecting.


Coming Thursday:


Economic Reports:Jobless Claims (expected to be 406k) at 8:30 am; Earnings from AT&T, Eli Lilly, Ford and Morgan Stanley.