Markets Lower, Closing News 8/19/11

Markets fell today, the Dow was down 172 points and the S&P 500 fell 17 points on continued concern over European banks, under pressure after HPQ fell 20.03% today following yesterday’s exploration of strategic alternatives for its PC business and merger announcement. For the week the Dow was 4.01% lower and the S&P 500 was down 4.69%.

Gold continued its run at all time highs, trading at $1,850 per ounce as investors turn to safe-havens for their money. Gold traded 1.50% higher today, and is up $232, 13.76%, since the beginning of August.

European banks continued their slide today on the continuing concern over their funding levels and liquidity issued. Barclays (-3.7%),  Banco Santander (-4.07%), and Royal Bank of Scotland (-6.97%) all trade lower today. UBS (-0.75%) and Credit Suisse (-1.80%) had their slides mitigated after both banks confirmed they were not the unnamed bank that accessed the Fed’s swap facility earlier this week.

Pressure for Germany and France to agree to issue Euro-zone bonds increased today after Belgian Finance Minister Didier Reynders told the Financial Times that the bonds would calm the volatile selloffs that we have seen in Euro-zone banks over the last few weeks.

SportsBusiness Journal is reporting that MetLife is close to a deal for the naming rights for the New Meadowlands Stadium, home to both the New York Giants and Jets.  If the deal goes through it will leave nine NFL stadiums not to have a corporate sponsor name, bonus points if you can name them.

Market Indices/Statistics:

  • Dow closed down 172.93 pts/-1.57% to 10,817.65
  • S&P closed down 17.12 pts/-1.50% to 1,123.53
  • Nasdaq closed down 38.59 pts/-1.62% to 2,341.84
  • 23 of the 30 Dow stocks closed lower / 7 closed higher
  • All 10 S&P 500 sectors closed lower
  • Information Technology was the worst performing sector (down 2.75%)
  • The VIX was up 0.38 points to 43.05
  • Oil is up $0.18 to $82.69
  • Nat Gas is up $0.031 to $4.069
  • Gold is up $31.00 to $1,849.80
  • Euro vs. Dollar up $0.0067 to $1.4393
  • Dollar vs. Yen flat to $76.49

Companies in the News:

Bank of America shares traded lower today (-0.57% to $6.97) after the Wall Street Journal reported an internal memo was distributed saying that it will cut 3,500 jobs this quarter and that further restructuring could result in up to 10,000 jobs cut.

Carl Icahn, the largest shareholder of Clorox Company, announced that he is nominating himself and 11 others to the board of directors. Clorox announced it has received Icahn’s nominations and will review his nominees, but that the Board of Directors believe he is nominating the slate to advance his own agenda. Shares of CLX traded slightly lower (-0.19% to $64.00) in today’s session.

Barnes and Noble slid today (-17.45% to $9.98) after announcing that Liberty Media has invested $204 million through the purchase of new convertible stock. In connection with the investment, Barnes and Noble will expand its Board of Directors to 12 members, and Liberty Media will be entitled to elect two members to the Board.

Shares of JC Penney traded higher (+2.39% to $24.38) after entering into a shareholder agreement with Pershing Square Capital Management. Pursuant to the agreement, William Ackman can increase his stake to 26.1%, up from the current limit of 16.5%, and will give Pershing Square one seat on the Board of Directors.

Earnings:

The Gap traded higher today (+1.10% to $15.69) after reporting Q2 earnings per share of $0.35 on sales of $3.39 billion vs. analysts’ consensus of $0.33 per share on $3.34 billion.

Shares of LDK Solar fell (-22.98% to $5.06) after revising its Q2 and FY guidance after the closing bell yesterday.  LDK cut its Q2 revenue view from $710-760 million to $480-500 million and its FY revenue view to $2.5-2.7 billion from $3.5-3.7 billion, setting up today’s slide.

Foot Locker closed higher today (+1.31% to $17.79) after reporting Q2 earnings per share of $0.24, beating analysts’ forecasts of $0.12 per share. The retailer also beat on the top-line, reporting Q2 sales of $1.28 billion vs. estimates of $1.18 billion.

Coming Monday:

Economic Reports: None; Earnings from Navios Maritime Holdings, ShangPharma Corp., and Zuoan Fashion Ltd.


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