Markets Lower, Closing News 9/15/11

Markets closed higher, extending the run of days in the green to four days, on news that central banks will be working together to provide liquidity for European banks.  The Dow closed up 186 points after brushing off the bad economic data from this morning


The European Central Bank, U.S. Federal Reserve, Bank of England, Bank of Japan, and the Swiss National Bank have agreed to offer three rounds of three month U.S. Dollar loans to commercial banks to provide liquidity and prevent money markets from drying up in Europe.  The three programs are scheduled for October 12, November 9, and December 7. 


Inflation in August was up 0.4%, higher than the 0.2% expected, but lower than the 0.5% increase from July.  The core Consumer Price Index reading (ex-food and energy) was up 0.2%, in-line with expectations.  Food prices were up 0.4% for the month, and gasoline prices were 1.9% higher.


Jobless claims rose unexpectedly 11k to 428k from 417k (revised higher from last week’s figure) after economists had been forecasting for a decline to 411k.  The reading of 428k is the highest level in two months, and was especially downbeat because of the revision higher and a statement from the Labor Department saying that there is no indication that Hurricane Irene impacted the claims reading.


The Empire State Manufacturing Index fell to -8.82 in September, marking the fourth straight month of contraction.  Economists had been forecasting a decline to -4.00, which was better than Augusts’ reading of -7.72.  The index monitoring new orders and employment were also lower.


Esther George was appointed to be the President of the Kansas City Federal Reserve, replacing Thomas Hoenig who is retiring effective October 1.  George is currently Vice-President and COO of the Kansas City Fed. 


President Obama today awarded the Medal of Honor to 21 year old Dakota Meyer, who defied orders and entered a “killing zone” to save the lives of 13 U.S. Marines and 23 Afghan Troops. 


Market Indices/Statistics:



  • Dow closed up 186.45 pts/+1.27% to 11,433.18

  • S&P closed up 20.43 pts/+1.72% to 1,209.11

  • Nasdaq closed up 34.52 pts/+1.34% to 2,607.07

  • All 30 Dow stocks closed higher

  • All 10 S&P 500 sectors closed higher

  • Financials was the best performing sector (+2.56%)

  • The VIX was down 2.63 points to 31.46

  • Oil is up $0.30 to $89.31

  • Nat Gas is down $0.133 to $3.985

  • Gold is down $34.50 to $1,792.00

  • Euro vs. Dollar up $0.0148 to $1.3886

  • Dollar vs. Yen down $0.01 to $76.69

Companies in the News:


UBS fell (-10.02% to $11.41) in trading today following reports that a rogue trader that accumulated approximately $2 billion in losses.  The trader, a 31-year old London-based employee, was arrested this morning and remains in police custody.


Shares of Morgan Stanley traded higher (+7.17% to $16.59) after announcing that John Mack will step down as Chairman and retire from a full-time role at year end.  CEO James Gorman was elected to become Chairman of the board, combining the two roles beginning in 2012.


Cash America International Inc. traded higher (+7.27% to $60.63) following the announcement that the Board of Directors has approved a plan to divest majority ownership of its wholly-owned subsidiary, Enova International, Inc., in a public offering.  Enova intends to list its common stock on the NYSE under the symbol ENVA.


Tyco International announced an agreement to acquire Visonic Ltd., a leading developer and manufacturer of wireless home security and safety systems and components for $100 million in cash, approximately $2.26 per share.  Shares of Tyco traded higher (+2.52% to $42.38) in today’s session.


Earnings:


Shares of Clarcor Inc. slipped (-3.49% to $44.24) after reporting Q3 results after the closing bell last night.  Clarcor reported earnings per share of $0.63 on revenue of $284 million, missing estimates of $0.66 per share on $307 million revenue.  Shares were also under pressure because CLC guided that FY earnings per share will be $2.25-2.40, below consensus of $2.42.


Marcus Corp. shares jumped higher (+17.57% to $10.24) after reporting Q1 earnings per share of $0.42 on $123.9 million revenue, beating analysts’ estimates of $0.40 on $116 million on both top and bottom line.


Coming Friday:


Economic Reports: University of Michigan Consumer Confidence (expected to be 56.9) at 9:55 am