U.S. equity markets opened about flat this morning but fell into a swoon following remarks from House Speaker John Boehner indicated that there has been no change to the gridlock in negotiations on the federal deficit. In Europe, eurozone finance ministers approved the next tranche of aid to Greece and also reached an agreement on a banking supervisory mechanism. In Asia, Japan’s Nikkei rose sharply as a weaker yen prompted equity investors. In the U.S., a load of data came out today: initial jobless claims fell by more than expected (more coverage here), retail sales were not quite as good as expected (more coverage here), and the producer price index fell (more coverage here). Still, none of this was strong enough to overcome the continuing drama related to the approaching fiscal cliff.
The U.S. dollar index rose today, now up 0.14% at 79.929. The GSCI commodity index is up 0.81% at 63705, with commodities prices mixed again today. WTI crude oil closed down 0.3% today, at $86.48 a barrel. Brent crude trades down 1.3% at $107.91 a barrel. Natural gas is down 1% today at about $3.35 per thousand cubic feet following a flat report on inventories (more coverage here). Gold settled down 1.2% today at $1,696.80 an ounce.
The unofficial closing bells put the DJIA down more than 71 points to 13,174.10 (-0.54%), the NASDAQ fell nearly 22 points (-0.72%) to 2,992.16, and the S&P 500 fell 0.62% or nearly 9 points to 1,419.58.
There were several analyst upgrades and downgrades today, including International Rectifier (NYSE: IRF) cut to ‘sell’ with a target price of $15 at Goldman Sachs; Linear Technology Co. (NASDAQ: LLTC) cut to ‘sell’ with a target price of $32 at Citigroup; Lexmark International Inc. (NYSE: LXK) cut to ‘sell’ with a target price of $18 at Deutsche Bank; United Therapeutics Corp. (NASDAQ: UTHR) cut to ‘sell’ with a target price of $50 at Goldman Sachs; and Tesoro Corp. (NYSE: TSO) raised to ‘outperform’ with a target price of $60 at Credit Suisse.
Earnings reports since markets closed last night have resulted in the following price changes for reporting companies as of the last half hour of trading today: Restoration Hardware Holdings Inc. (NYSE: RH) is down 3.8% at 35.29, a new 52-week low; Ciena Corp. (NASDAQ: CIEN) is up 1.2% at 15.76; Hovnanian Enterprises Inc. (NYSE: HOV) is down 4.5% at $5.25 after posting a new 52-week low of $5.38 earlier today; and Pier One Imports Inc. (NYSE: PIR) is up 1% at $19.26 (more coverage here).
Some standouts from today include the following stocks:
Clearwire Corp. (NASDAQ: CLWR) is up 14.2% at $3.14 after posting a new 52-week high of $3.18 earlier today. The wireless carrier has been offered $2.90 a share by majority owner Sprint Nextel Corp. (NYSE: S) for the 49% of shares that Sprint doesn’t already own. Investors seem to think that a bidding war could start. More coverage here.
Harbinger Group Inc. (NYSE: HRG) is down 26.5% at $7.51. The private equity firm priced a secondary offering of 20 million shares at $7.50, a discount of more than 25% to last night’s closing price.
Stay tuned for Friday. We have noted the following events on the schedule (all times Eastern):
- 8:30 a.m. – Consumer price index
- 8:58 a.m. – Flash manufacturing PMI
- 9:15 a.m. – Industrial production