Markets Mixed, Closing News 7/5/11

The markets began the day looking for some direction as the futures seesawed between negative and positive territory on worries about interest rate hikes from China and the ECB. At the opening, the equity markets kicked off the holiday-shortened week down as investors took a step back. Trading was choppy with low volume following its best week in two years.

Towards mid-morning, the Dow and S&P stayed negative, while the Nasdaq was up about 4 points following slightly better than expected new orders received by U.S. factories in May. A government report showed an increase in demand for transportation equipment.

After the half way point, the markets started to turn negative as uncertainty kept investors away. The soft patch that the markets incurred during June seemed to be on the minds of investors.  According to analysts on CNBC, second quarter earnings are expected to improve, however, traders are concerned over the guidance for the rest of the year. AutoNation Chairman and CEO Mike Jackson, addressed his company’s view of the auto market saying he is seeing stronger sales from luxury customs, but lower sales in Florida and California due to the supply disruption from Japan and the depressed housing market. Jackson also said June has been the worst selling month for the year as companies are pulling back in marketing and advertising, but now that production is back online and shipments are improving, he expects the car market to pick up by the end of the year.

At the close, the Dow and S&P stumbled after Moody’s Investor Services cut Portugal’s long-term bond ratings to Ba2, or junk, from Baa1 with a negative outlook. Moody’s cites a growing risk that Portugal will require a second round bailout.

Market Indices/Statistics:

  • Dow closed down 12.90 pts/-0.10% to 12,569.87
  • S&P closed down 1.79 pts/-0.13% to 1,337.88
  • Nasdaq closed up 9.74 pts/+0.35% to 2,825.77
  • 15 of the 30 Dow stocks closed lower / Chevron (CVX) was the best Dow performer
  • 6 of the 10 S&P 500 sectors closed lower 
  • Energy and Consumer Discretionary was the best performing sectors
  • The VIX is up 0.19 pts to 16.06
  • Oil is up $1.97 to $96.54
  • Nat Gas is down $0.029 to $4.359
  • Gold is down $33.10 to $1,515.70
  • Euro vs. Dollar up $0.0121 to $1.4420
  • Dollar vs. Yen up $0.3000 to $81.0450

Companies in the News:

Energy Transfer Equity LP (ETE) announced it is increasing its offer for Southern Union Co (SUG) by 2.8 percent to $41.52 or about $5 billion beating the $4.9 billion offer from Williams Companies Inc (WMB).

National Oilwell Varco, Inc. (NOV) announced it is acquiring Ameron International Corporation, (AMN) for about $772 million.  Ameron’s shareholders will receive $85.00 per share in cash in return for each they own.

Immucor Inc., (BLUD) announced it is being acquired by TPG Capital for $27 a share in cash or approximately  $1.97 billion.

Tanger Factory (SKT) was upgraded to buy from hold at Jefferies based on recent acquisitions and lower development risk.  The price target was raised to $32 from $27.  Tanger closed up 2.1%.

Medtronic Inc. (MDT) was downgraded to market perform from outperform at Wells Fargo citing spine business concerns following the infuse papers published in The Spine Journal.  The new price target range is  $36-$37 from $46-$47.  Medtronic cloed down 2.9%.

Earnings:

None for today.  Traders are look for some companies to provide pre announcements ahead of second quarter earnings season.

Coming Tuesday:

Economic Reports:ISM Non-Mfg Index at 10:00 am