YAHOO [BRIEFING.COM]: Equities
opened the session on a higher note after reports indicated Spain may be
willing to ask for access to precautionary credit. The reports were followed by
comments out of Germany which suggested the country's officials believe
additional hurdles remain in Spain's way. Separate reports indicated the old
continent's other troubled sovereign, Greece, is far from reaching an agreement
with the Troika on its next bailout tranche. The European news did little to
curb optimism as buyers lifted the major averages to midday session highs,
which were maintained into the close. As a result the S&P 500 registered a
gain of 1.0%.
Citigroup (C 37.25, +0.59) advanced 1.6% after
announcing Chief Executive Officer, Vikram Pandit, and President and Chief
Operating Officer, John Havens, have resigned. The resignations are effective
immediately and the company's board has elected Michael Corbat as the new CEO.
Goldman
Sachs (GS 123.22,
-1.28) slipped 1.0% despite cruising past its earnings and revenue estimates.
The financial giant exceeded Capital IQ earnings expectations by $0.58 and
reported revenues nearly $1 billion ahead of Capital IQ estimates. In addition,
the investment bank increased its dividend to $0.50 from $0.48.
PNC (PNC 60.40, -2.53) fell 4.0% despite
beating on earnings and revenues.
Meanwhile, American Express (AXP 58.63, +1.04) outperformed and closed with a gain of
1.8%.
European financials showed considerable strength after earlier reports
indicated Spain may ask for precautionary credit. Even though German officials
have since come out to cool the speculation, European banks have maintained
their gains. Deutsche Bank (DB 45.02, +1.97) rose by 4.6% while Banco Bilbao Vizcaya
Argentaria (BBVA
8.24, +0.51) jumped 6.6%.
The materials sector led the broader market. Within the space, steel producers
showed notable gains. Cliffs Natural Resources (CLF 44.07, +2.93) and Olympic Steel (ZEUS 18.77, +1.07) advanced 7.1% and
6.1%, respectively.
Packaging stocks also showed strength. Packaging Corp (PKG 36.26, +0.66) rose by 1.9% after
reporting mixed earnings. The company reported a slight earnings miss, while
its revenues were in-line with Capital IQ estimates. In addition, the
management issued upside fourth quarter guidance. Peers Owens-Illinois (OI 20.61, +0.45) and Greif (GEF 44.04, +0.87) registered gains of
2.2% and 2.0%, respectively.
Also of note, provider of construction materials Texas Industries (TXI 44.47, +3.28) surged 8.0% after
Sidoti upgraded the stock to ‘buy.'
The Dow Jones Transportation Average outperformed the broader market and
settled higher by 1.1%.
Railroads Kansas City Southern (KSU 77.35, +2.65) and Union Pacific (UNP 123.40, +2.47) saw respective gains
of 3.6% and 2.0%. Freight carriers were also on the rise. Expeditors International
of Washington
(EXPD 35.25, +0.25) and CH Robinson (CHRW 60.90, +0.54) both added near 0.8%.
Meanwhile, Overseas Shipholding Group (OSG 3.76, -1.41) was the worst performer
among transportation stocks. The shipper sank 27.3% to extend its recent
weakness. There did not appear to be any news related to the company and
today's selling follows the stock's Friday decline of 13.6%.
In consumer stocks, Coca-Cola (KO 37.90, -0.23) slid 0.6% after the
beverage giant reported in-line earnings and revenues.
Avon
Products (AVP
17.14, -0.13) slipped 0.8% after the Food and Drug Administration disclosed a
letter which warns the cosmetics producer about the marketing of some of its
products.
WD-40
Company (WDFC
47.66, -3.39) fell 6.6% after missing on both earnings and revenues . In
addition, the company lowered its full-year 2013 earnings and revenue guidance
below consensus.
In economic news, the August net long-term TIC flows report indicated a $91.4
billion inflow of foreign capital into U.S. denominated assets. This follows
the prior month's reading of $67.0 billion.
Industrial production increased during September by 0.4%, which was better than
the 0.3% increase that had been widely expected. The reading follows the
unrevised 1.2% decrease experienced in the prior month. Capacity utilization
hit 78.3%, which was in-line with the Briefing.com consensus, and up from the
unrevised prior month reading of 78.2%.
September consumer prices increased by 0.6% which was slightly better than the
Briefing.com consensus of a 0.5% increase. Today's reading follows prior
month's 0.6% increase. In addition, core prices rose by 0.1% which was slightly
cooler than the generally expected increase of 0.2%.
The NAHB Housing Market Index for October registered a reading of 41. That was
up from the prior month's reading of 40, and slightly worse than the reading of
42 that had been expected among economists polled by Briefing.com.
Crude oil oscillated between
positive and negative territory as the dollar index weakened. Prices popped to
a session high of $92.30 per barrel moments after floor trade opened and
brushed a session low of $91.30 per barrel in morning action. A rally heading
into the close had crude settle at $92.08 per barrel, or 0.3% higher.
Natural gas extended yesterday's losses as it trended lower into the red on
milder weather forecasts. It fell off a session high of $3.47 per MMBtu set in
early morning pit trade and eventually closed 1.4% lower at $3.44 per MMBtu.
Precious metals got a boost from a drop in the dollar following headlines out
of Europe suggesting that Germany may be open to precautionary credit for
Spain. The reports were later refuted by German officials, but both gold and
silver continued to trade firmly in the black. Gold climbed as high as $1748.90
per ounce in morning pit action and settled with a 0.5% gain at $1746.20 per
ounce. Silver dipped to a session low of $32.79 per ounce and moments later
popped to a session high of $33.08 per ounce. It eventually closed with a 0.7%
gain at $32.97 per ounce.
Tomorrow, the weekly MBA Mortgage Index will be announced at 7:00 ET, while
September housing starts and building permits will be released at 8:30 ET.DJ30
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