Alcoa Kicks Off Earnings Season With a Beat

Stocks opened flat on Turnaround Tuesday only to cascade down to the lows of the day shortly thereafter. However, crude oil futures acted in the exact opposite fashion, rising nearly 3% to $92.25. Early in the trading session, Apple (AAPL) fell as much as 2% to $623, but recovered nicely on the day, closing the day down only 0.25%.

German Chancellor Angela Merkel visited Greek Prime Minister Samaras today in Athens amidst 25,000 protesters. Merkel pledged her support for a country that has seen youth unemployment levels skyrocket and a recession deepen. The troika (ECB, IMF, and EU) officials continue to analyze the Greek government’s pledges to cut spending and boost growth in order to allow the next tranche of aid to be released to Greece from the region’s bailout fund.

The latest Gallup poll showed that Romney gained on Obama among likely voters. Romney now holds an estimated 49% of the vote compared to Obama’s 47%, with a margin of error of 2%. Last week’s poll showed Obama holding a lead over Romney at 50% to 45%. Today’s sell-off likely disproves the theory that stocks rose last Thursday on Romney’s outperformance of Obama at the presidential debate.

Following up on a lawsuit filed last week against JPMorgan (JPM) that involved defective mortgage loans stemming from its acquisition of Bear Stearns, the US filed a lawsuit against Wells Fargo (WFC), stating that the bank falsely certified FHA loans that once defaulted and had to be paid for by the US government.

Aluminum manufacturer Alcoa (AA) kicked off earnings season by beating earnings-per-share estimates. The company reported EPS of $0.03 vs estimates of break-even and lowered their global aluminum demand forecast for 2012 to 6% from 7%.

The Fed will release its beige book of economic conditions throughout the 12 Fed districts. Today, the minutes from the regional directors’ meeting were released, and noted the fiscal uncertainty ahead, positive changes in housing, and increasingly weak manufacturing.

In the morning, the Census Bureau will release Merchant Wholesalers Inventories for August with economists forecasting a monthly decline to 0.4% from 0.7%. In the afternoon, the Treasury will sell $21 billion in 10-year notes. The current 10-year note closed at a yield of 1.71% today.

In earnings, Costco (COST), Progressive (PGR), ADTRAN (ADTN), and OCZ Technology (OCZ) will report earnings.

Annunci

Stocks Reverse on Hint of Bond Buying Plan from the ECB

It was a very sleepy summer day for the markets. Today started off with ECB officials stating that the central bank will not make any decisions on a bond-buying program until the German Constitutional Court ratifies the ESM’s treaty on September 12. Later in the day, Reuters reported that the ECB was exploring yield band targets for a bond-buying program.

Durable goods orders were released in the morning, gaining 4.2% from last month’s 1.6%, which was ahead of economist expectations of 4.2%. Crude oil futures rose after the report before finishing in negative territory on the day.

Over the weekend, China will report year-to-date industrial profits. On Monday, Germany will release business climate indicators from the IFO Institute.

On Monday in the US, the Dallas Federal Reserve will report manufacturing numbers. Economists are expecting the index to rise from -13.7 to -7.

Tiffany’s (TIF) and Samsonite (SMSOF) will report earnings.

Weekly ETF Channel Newsletter

ETF Channel
Weekly ETF Newsletter
The ETF Week in Review
This thirty fourth trading week of 2012 comes to a close with investors sending stocks higher on Friday after Ben Bernanke’s comments that there was still room for the Fed to act.

ETFs


The Gold Explorers ETF (GLDX) outperformed other ETFs this week, up about 8.9%. Components of that ETF showing particular strength this week include shares of Keegan Resources (KGN.CA), up about 24.2% and shares of Sabina Gold and Silver (SBB.CA), up about 19.4% on the week.
And underperforming other ETFs this week is the Steel ETF (SLX), down about 3.8% this week. Among components of that ETF with the weakest showing for the week were shares of Worthington Industries (WOR), lower by about 9%, and shares of United States Steel (X), lower by about 8% on the week.

Other ETF standouts this week include the Junior Gold Miners ETF (GDXJ), outperforming this week with a 6.9% gain. And the S&P Emerging Markets High Beta Portfolio (EEHB) was an underperformer, falling about 3.4% this week.

 

EQUITIES

The Dow Jones Industrial Average, the Nasdaq, and the S&P 500 edged lower for the week.

GOLD AND OIL

Crude oil futures are higher this week, trading around $96.40 per barrel on Friday afternoon.

Gold futures are higher this week, trading at $1,669.99 an ounce in afternoon trading.

ECONOMY

In notable economic news this week, jobless claims rose by 4,000 for a second week to reach 372,000 in the period ended August 18 according to the Labor Department.CORPORATE NEWS

In corporate news this week, Best Buy (BBY)announced that net income during the quarter fell by 90 percent, due to weak sales and restructuring charges. The company earned $12 million, or 4 cents per share, versus $128 million, or 34 cents per share in the same period last year. Adjusted earnings were 20 cents per share, and revenue declined by about three percent to $10.55 billion.Dell (DELL) announced that it earned $732 million in the second fiscal quarter on revenue of $14.5 billion, or 42 cents per share, versus a profit of $890 million on revenue of $15.6 billion in the same period last year. The amounts to an eighteen percent decline in profit, and eight percent revenue decline.

Hewlett-Packard (HPQ) announced that it lost $8.9 billion, or $4.49 per share, versus a profit of $1.93 billion, or 93 cents per share in the same period last year. Revenue was $29.7 billion versus $31.2 billion in the same period last year. The results include a one time $10.8 billion, or $5.49 per share charge related to one time changes. Analysts had expected adjusted profit of 98 cents per share on revenue of $30.2 billion.

Autodesk (ADSK) announced that it earned 48 cents per share on revenue of $568.7 million, below estimates of 49 cents per share and revenue of $593.5 million. The company expects a profit of 40-45 cents per share in the current quarter, and revenue in the range of $550 to $570 million, well below estimates of 50 cents per share and revenue of $601.3 million.

A Seoul, South Korea court ruled that Samsung’s Galaxy smartphone looks very similar to Apple’s (AAPL) iPhone, but the company did not violate the iPhone design patents.


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Weekly ETF Channel Newsletter

ETF Channel
Weekly ETF Newsletter
The ETF Week in Review
This thirty third trading week of 2012 comes to a close with investors assessing better than expected data on consumer confidence and leading indicators.

ETFs


The Uranium ETF (URA) outperformed other ETFs this week, up about 8.7%. Components of that ETF showing particular strength this week include shares of Uranium One (UUU.CA), up about 16.5% and shares of Uranium Energy (UEC), up about 16.4% on the week.
And underperforming other ETFs this week is the Coal ETF (KOL), off about 4.1% this week. Among components of that ETF with the weakest showing for the week were shares of Alpha Natural Resources (ANR), lower by about 11.8%, and shares of Arch Coal (ACI), lower by about 6.2% on the week.

Other ETF standouts this week include the SPDR S&P Homebuilders ETF (XHB), outperforming this week with a 5.6% gain. And the Social Media Index ETF (SOCL) was an underperformer, falling about 3.7% this week.

EQUITIES

The Dow Jones Industrial Average, the Nasdaq, and the S&P 500 edged higher for the week.

GOLD AND OIL

Crude oil futures are higher this week, trading around $95.96 per barrel on Friday afternoon.

Gold futures are lower this week, trading at $1614.88 an ounce in afternoon trading.

ECONOMY

In notable economic news this week, Jobless claims climbed by 2,000 to 366,000 according to Labor Department figures. The four-week moving average dropped to 363,750.CORPORATE NEWS

In corporate news this week, Home Depot (HD)announced that it earned $1.53 billion, or $1.01 per share, in its second fiscal quarter that ended on July 29, up from $1.36 billion, $0.86 per share in the same period last year. Analysts had expected earnings of of 97 cents per share. Revenue increased by 1.7 percent to $20.57 billion, below estimates of $20.74 billion.Target (TGT) announced that it earned $1.06 per share in its most recent fiscal quarter, versus the $1.01 per share that analysts estimated. Revenue was $16.78 billion. Analysts had expected $16.84 billion in revenue.

Lenovo Group (LNVGY), the world’s second-largest PC maker behind Hewlett-Packard (HPQ) announced that profit rose to $141.4 million for the quarter ending on June 30, up from $108.8 million in the same period last year. Analysts estimated earnings of $133.5 million.

Wal-Mart Stores (WMT) announced that it earned $1.18 per share on $113.5 billion in revenue for its most recent fiscal quarter. In the same period last year, the company earned $1.09 per share on $109.4 billion revenue. Analysts had expected earnings per share of $1.07, and revenue of $115.75 billion. The company attributed the miss to the effects of currency translation.

Apple (AAPL) saw its shares hit a record intraday high of $644.13 due to continuing chatter ahead of an expected iPhone 5 announcement early next month.


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Weekly ETF Channel Newsletter

ETF Channel
Weekly ETF Newsletter
The ETF Week in Review
The thirty second trading week of 2012 comes to a close with investors assessing a worse-than-expected Chinese trade report that may intensify concern that global growth is slowing.

ETFs

The Industrials GEMS ETF (IGEM) outperformed other ETFs this week, up about 8.5%. Components of that ETF showing particular strength this week include shares of Millennial Media (MM), up about 45.7% and shares of Adex Mining (ADE.CA), up about 16.7% on the week.And underperforming other ETFs this week is the SPDR Dow Jones REIT ETF (RWR), off about 2.6% this week. Among components of that ETF with the weakest showing for the week were shares of Commonwealth Reit (CWH), lower by about 14.5%, and shares of Vornado Realty Trust (VNO), lower by about 6.9% on the week.

Other ETF standouts this week include the S&P International Developed High Beta Portfolio (IDHB), outperforming this week with a 6.8% gain. And the Vanguard REIT ETF (VNQ) was an underperformer, falling about 2.5% this week.

EQUITIES

The Dow Jones Industrial Average, the Nasdaq, and the S&P 500 edged higher for the week.

GOLD AND OIL

Crude oil futures are higher this week, trading around $92.73 per barrel on Friday afternoon.

Gold futures are higher this week, trading at $1619.91 an ounce in afternoon trading.

ECONOMY

In notable economic news this week, the number of Americans applying for unemployment benefits fell by 6,000 to a seasonally adjusted 361,000. The U.S. trade deficit narrowed to $42.9 billion in June from $48 billion in May, the lowest level in 18 months. SPONSORED AREA 

 

CORPORATE NEWS

In corporate news this week, cvsCVS Caremark (CVS) announced that it earned $966 million, or 75 cents per share, in its most recent fiscal quarter, versus $816 million, or 16 cents per share, in the same period last year. Results beat estimates, and revenue increased by 16 percent. The company attributed much of the gain from former wagWalgreen (WAG) customers it attracted after that company ended its prescription relationship is esrxExpress Scripts (ESRX).owwOrbitz Worldwide (OWW) reported that second quarter profit fell, and also cut its forecast for the full year. Net income was $4.6 million, or 4 cents per share, versus $8.9 million, or 8 cents per share in the same period last year. Analysts had expected five cents per share. Revenue was $200.98 million, while analysts had expected $207.77 million.

ttmTata Motors (TTM) announced that first quarter profits increased by 12 percent, mainly due to a sales jump at its Jaguar Land Rover subsidiary that offset lower profits in its domestic business. Net profit was 22.45 billion rupees, or $406 million and revenue was 433.2 billion rupees, about 30 percent higher than the same period last year. Analysts expected a profit of 27.61 billion rupees on revenue of 429.4 billion rupees.


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Weekly ETF Channel Newsletter

ETF Channel
Weekly ETF Newsletter
The ETF Week in Review
This thirty first trading week of 2012 comes to a close with investors reacting positively to the latest jobs number as the calendar turns to August.

ETFs

The Global Steel Portfolio ETF (PSTL) outperformed other ETFs this week, up about 4.6%. Components of that ETF showing particular strength this week include shares of United States Steel (X), up about 14.2% and shares of Mechel OAO (MTL), up about 13.9% on the week.And underperforming other ETFs this week is the SPDR S&P Biotech ETF (XBI), off about 7.6% this week. Among components of that ETF with the weakest showing for the week were shares of Halozyme Therapeutics (HALO), lower by about 51.3%, and shares of Aveo Pharmaceuticals (AVEO), lower by about 30.7% on the week.

Other ETF standouts this week include the Direxion Large Cap Insider Sentiment Shares (INSD), outperforming this week with a 4.5% gain. And the Dynamic Biotechnology & Genome Portfolio (PBE) was an underperformer, falling about 5.6% this week.

EQUITIES

The Dow Jones Industrial Average, the Nasdaq, and the S&P 500 edged higher for the week.

GOLD AND OIL

Crude oil futures are higher this week, trading around $91.45 per barrel on Friday afternoon.

Gold futures are lower this week, trading at $1604.89 an ounce in afternoon trading.

ECONOMY

In notable economic news this week, the U.S. economy created more jobs than expected with 163,000 new positions added in July, though the unemployment rate rose to 8.3 percent.CORPORATE NEWS

In corporate news this week, UBS (UBS) announced that profits in the second quarter fell by 58 percent to 425 million francs, or $434.16 million, mostly due to losses incurred in the Facebook (FB)IPO, as well as a decline in investment banking business. A year ago, the company earned 1.02 billion francs, or $1.2 billion. Analysts had expected a profit of 1 billion francs.Dollar Thrifty Automotive Group (DTG) announced that net income in the second quarter increased by 16 percent, mainly due to lower costs. The company earned $49.4 million, or $1.69 per share, versus $42.5 million, or $1.36 per share in the same period last year. Revenue increased to $395.4 million from $395.1 million.

Tesoro (TSO) announced a 78 percent increase in profit during the second quarter, mainly due to increased margins in its west coast refining business. Earnings were $387 million, or $2.75 per share, versus $218 million, or $1.52 per share during the same quarter in 2011. Analysts expected earnings of $2.30 per share.

Toyota (TM) announced that profit in the April to June quarter were 290.3 billion yen, or $3.7 billion. Sales increased by 60 percent to 5.5 trillion yen, or $70.5 billion. Quarterly vehicle sales were nearly double to 2.3 million vehicles, as sales rose globally.


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Weekly ETF Channel Newsletter

ETF Channel
Weekly ETF Newsletter
The ETF Week in Review
This thirtieth trading week of 2012 comes to a close with investors sending stock higher on Friday, betting that European leaders will act together to get the region’s debt crisis under control soon.

ETFs

The Oil Services ETF (OIH) outperformed other ETFs this week, up about 4.5%. Components of that ETF showing particular strength this week include shares of Cameron International (CAM), up about 13.6% and shares of Baker Hughes (BHI), up about 12.6% on the week.And underperforming other ETFs this week is the Social Media Index ETF (SOCL), off about 7.2% this week. Among components of that ETF with the weakest showing for the week were shares of Zynga (ZNGA), lower by about 32%, and shares of Yelp (YELP), lower by about 20.2% on the week.

Other ETF standouts this week include the Dynamic Oil & Gas Services Portfolio (PXJ), outperforming this week with a 3.3% gain And the Global Steel Portfolio (PSTL) was an underperformer, falling about 6.4% this week.
EQUITIES

The Dow Jones Industrial Average and the S&P 500 edged higher for the week, while the Nasdaq trade relatively flat.

GOLD AND OIL

Crude oil futures are lower this week, trading around $90.00 per barrel on Friday afternoon.

Gold futures are higher this week, trading at $1618.40 an ounce in afternoon trading.

ECONOMY

In notable economic news this week, manufacturers’ orders for durable goods increased by 1.6% to a seasonally adjusted $221.63 billion. Orders for May were revised up to $218.20 billion, a 1.6% gain from the prior month.

 

 

CORPORATE NEWS

In corporate news this week, NRG Energy (NRG) announced it will buy power producer GenOn Energy (GEN) in a deal worth $1.7 billion in stock.

United Parcel Service (UPS) announced that quarterly results missed forecasts, and it also cuts its 2012 outlook due to global uncertainty. Adjusted earnings increased by 7.5 percent to $1.15 per share versus $1.07 per share in the same period last year. Estimates were for earnings of $1.17 per share. Revenue increased to $13.35 billion from $13.19 billion in the same period last year, and was below the estimate of $13.7 billion.

JetBlue (JBLU) announced that net income increased to $52 million, or 16 cents per share, versus $25 million, or 8 cents per share, in the same period last year. Revenue increased by 11 percent to $1.23 billion. The airline said that the gains were due to an increase in business and leisure travel, and the profit was its highest second quarter profit in history.

Delta Air Lines (DAL) said that it lost $168 million, or 20 cents per share, in the most recent fiscal quarter, down from $198 million, or 23 cents per share, in the same period last year. Revenue increased to $9.73 billion from $9.15 billion. The company forecast a return to profitability next quarter.

Sprint Nextel (S) announced that it lost $1.37 billion, or 46 cents per share, versus $847 million, or 28 cents per share in the same period last year. Revenue was $8.8 billion versus $8.3 billion last year, and analysts had expected $8.727 billion.

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