M&A Activity Keeps Stocks Hot As The DJIA Hits Another All-Time High; Higher Highs On Lower Volume
May 8, 2007 | Leave a Comment
Stocks started the morning higher off another great day in China, with the Shanghai index up 2.2%, and on the news of a huge M&A announcement between two of the biggest aluminum giants and another merger in the defense arena.
Early on AA made a hostile takeover bid for AL. The $26.9 billion bid would make this the biggest merger ever in the aluminum arena and create a $54 billion behemoth. The other big merger involved AH being acquired by the British BAE Systems for $4.1 billion. The other talk was that ABN has also become a target of other suitors. obviously, the M&A rumor and deal mill are in full swing. Read more
A Very Eventful And Green Week Comes To A Close With Stocks Up Across The Board On Mixed Volume
May 5, 2007 | Leave a Comment
Stocks started the day off on a very positive note thanks to a couple of big merger rumors and more positive earnings from top stocks that outweighed the poor jobs report. Reports that MSFT wants to buy the search engine YHOO (around a $50 billion transaction) and that RTRSY is being offered takeover bids possibly by Thomson Financial definitely put a fire to a market that is just flush with M&A activity. Great earnings from CROX FSLR UEIC PCLN and RIO did not hurt either.
Good news from the micro could not be found in the macro today. The April jobs report showed only 88,000 jobs were added this month. This was below the 100,000 expected by pundits and was the smallest increase in two years. This is another sign that the economy is starting to slow down. Unemployment ticked up to 4.5% and average hourly earnings rose .2% below expectations of .3%. This can be taken as slightly positive since it does not show rapid inflation in wages. Read more
Today Was No Different Than The Rest, As Stocks Hit More All-Time And Six-Year Highs
May 4, 2007 | Leave a Comment
Stocks started the day off with a slight gap higher, thanks to a good day in China with the Shanghai index gaining 2.2% and on the back of more good earnings and economic data.
Jobless claims fell 21,000 to 305,000, better than expectations for a 10,000 increase. The ISM non-manufacturing index rose to 56 in April from 52.4 in March which is an incredible 49th straight month above 50. Wages grew .6% in the first quarter and productivity for the first quarter grew 1.7%–this caused some traders to speculate a rate cut could be possible (don’t hold your breath). Stellar earnings from NVEC, GFIG, HURN, RDS.A, and CBS didn’t help stocks in the morning either. Read more
Stocks Race To Six-Year And All-Time Highs But On Lower Volume; Smallcaps, Technology, And Leading Stocks Outperform
May 3, 2007 | Leave a Comment
More solid earnings reports, a strong factory orders report, and lower oil sent stocks gapping higher in the morning. Earnings from CMG, BWLD, BGC, DWSN, SPSS, MA, and DLLR blew the pants off estimates and helped their stocks and the indexes tack on large gains in the morning. During the time those earnings were coming out, factory orders rose 3.1% in March, above estimates of 2.1% and at the fastest pace in over a year. And oil fell $1.13 to $63.68, helping stocks forge ahead with the gains.
This was all the market needed to gap higher and rally the rest of the day, as shorts were squeezed hard. The put/call fell from 1.05 to .7, by the end of the day, as shorts ran for the hills. There was some slight profit taking in the final hour but when it was the day was over stocks still put in a very impressive short-killing day. Read more
A Choppy And Random Day Ends With Stocks Slightly Positive On Higher Volume; Leading Stocks Didn’t Do As Well
May 2, 2007 | Leave a Comment
Stocks started the day on a slight positive note thanks to some positive earnings and comments from stocks like PG. But the slightly positive open gave way to some selling after the ISM manufacturing index and NAR’s pending home sales numbers were released. The ISM manufacturing number came in at a better-than-expected 54.7 in April up from 50.9 in March. The National Association of Realtors pending home sales contracts fell 4.9% in March to 104.3. This was the lowest reading since March 2003 and obviously had a negative effect on the market. Read more
Stock Indexes Close Mixed And With Little Change, On Lower Volume; DJIA Up 19 Out Of Past 21 Sessions
May 1, 2007 | Leave a Comment
Despite amazing earnings reports from BIDU, MSFT, VSEA, MFW, DV, TEX, MTD, NOV, VLCM, NTGR, and DRIV, stock indexes decided to focus on the early morning GDP report and opened flat to slightly lower. GDP growth came in at 1.3% in the most recent quarter, down from economist 1.8% expectations and a four-year low. The poor GDP reading and the fact that YOY inflation is running at 2.2% definitely had a slightly negative impact. This poor reading helped the Euro hit a record high against the US dollar. The poor numbers were enough to keep the market choppy most of the day but the DJIA still hit another all-time high.
At the close the DJIA and the Nasdaq led the way higher with .1% gains, the SP 500 finished flat, the NYSE fell .1%, the SP 600 fell .3%, and the SP 400 led the way lower with a .4% drop. Leading stocks, in the form of the IBD 100, did not lead to the upside but they did not lead to the downside either, falling .2%. A respectable showing.
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