24/7 Wall St. Closing Bell — July 10, 2012: Market Declines on Weak Profits, More Warnings

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The three major US stock indexes opened higher this morning on reports of a new bailout for Spanish banks and a 24-basis point drop on 10-year Spanish bond yields (our coverage here). The dollar strengthened throughout the day, but it could be that early earnings results were simply not encouraging looking forward. Commodities prices dropped as did crude prices on the rising dollar. The news from China on falling imports was out early this morning and likely contributed something to the overall weakness in the market today (our coverage here).

The US dollar index rose today, now up 0.31% at 83.416. The GSCI commodity index also rose, up about 1.8% at 615.94, with commodities prices mostly lower today. WTI crude oil fell -0.9% today, closing at $85.25/barrel. Brent crude trades down -2.4% at $97.91/barrel, as a lockout in Norway’s North Sea fields was averted (our coverage here). Natural gas is down -4.8% today to $2.744/thousand cubic feet. Gold settled down -0.6%, at $1,579.80/ounce.

The unofficial closing bells put the DJIA down more than 83 points to 12,653.12 (-0.65%), the NASDAQ fell more than 29 points (-1.00%) to 2,902.33, and the S&P 500 fell -0.81% or nearly 11 points to 1,341.47.

There were several analyst upgrades and downgrades today, including American Express Co. (NYSE: AXP) raised to ‘buy’ at Nomura; J.C. Penney Company Inc. (NYSE: JCP) maintained as ‘neutral’ but estimates cut at Credit Suisse; Limited Brands Inc. (NYSE: LTD) cut to ‘hold’ at Argus; Southwest Airlines Co. (NYSE: LUV) raised to ‘buy’ at Sterne Agee; and Tyson Foods Inc. (NYSE: TSN) cut to ‘neutral’ at JPMorgan.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: Alcoa Inc. (NYSE: AA) is down -4.6% at $8.36; WD-40 Co. (NASDAQ: WDFC) is down -4.2% at $48.33; Helen of Troy Ltd. (NASDAQ: HELE) is down -13.1% at $29.59; Shaw Group Inc. (NYSE: SHAW) is down -9.9% at $25.59; Wolverine World Wide Inc. (NYSE: WWW) is up 6.6% at $40.86; and SemiLEDS Corp. (NASDAQ: LEDS) is down -5% at $2.64 after posting a new 52-week low of $2.50 earlier today.

Tomorrow we are scheduled to get earnings results from Adtran Inc. (NASDAQ: ADTN), Itron Inc. (NASDAQ: ITRI), Marriott International Inc. (NYSE: MAR), and Texas Industries Inc. (NYSE: TXI).

Some standouts from today include the following stocks:

James River Coal Co. (NASDAQ: JRCC) is down -27.5% at $2.08. The coal miner is suffering the confirmation this morning of the bankruptcy filing by Patriot Coal Corp. (NYSE: PCX). More coverage here.

MAKO Surgical Corp. (NASDAQ: MAKO) is down -43.1% at $14.01 after posting a new 52-week low of $14.00 earlier today. The medical device maker cut its estimate on sales of its orthopedic robotic arm system.

Advanced Micro Devices Inc. (NYSE: AMD) is down -11.5% at $4.97. The semiconductor maker lowered its quarterly earnings forecast. More coverage here.

Chesapeake Energy Corp. (NYSE: CHK) is down -7.4% at $18.50. The natural gas producer’s shares went ex-dividend today in advance of the company’s dividend payment of $0.0875 on July 31st.

Stay tuned for Wednesday. We have noted the following events on the schedule (all times Eastern):

  • 7:00 a.m. – Mortgage Bankers Association purchase applications
  • 8:30 a.m. – International trade data
  • 10:00 a.m. – Wholesale trade data
  • 10:30 a.m. – EIA weekly petroleum status report
  • 1:00 p.m. – 10-year note auction
  • 2:00 p.m. – FOMC minutes released

Paul Ausick