24/7 Wall St. Closing Bell -- July 13, 2012: Market Jumps on Financials, Hopes for China

The three major US stock indexes opened higher this morning following the release of Chinese GDP and other data. The Middle Kingdom’s GDP grew at a rate of 7.6% in the second quarter, down from 8.1% growth last year, kindling hopes that the government would take further action to stimulate the economy (our coverage here). The ratings cut on Italian debt had less impact on investors as the data from China pushed the cut to one side. Solid quarterly earnings reports from Wells Fargo & Co. (NYSE: WFC) and JPMorgan Chase & Co. (NYSE: JPM) also drove the market higher at opening and the financial sector buoyed stock prices all day.

The US dollar index fell today, now down -0.34% at 83.377. The GSCI commodity index rose about 0.4% to 614.91, with commodities prices mostly higher today. WTI crude oil rose 1.2% today, closing at $87.10/barrel, up 3.1% for the week. Brent crude trades up 1.5% at $102.58/barrel. Natural gas is up 0.1% today to $2.877/thousand cubic feet. Gold settled at $1,592.00/ounce, up 0.8% for the week.

The unofficial closing bells put the DJIA up more than 203 points to 12,777.09 (1.62%), the NASDAQ rose more than 42 points (1.48%) to 2,908.47, and the S&P 500 rose 1.65% or about 22 points to 1,356.77.

There were several analyst upgrades and downgrades today, including Saks Inc. (NYSE: SKS) cut to ‘underperform’ at BofA/ML; Kinder Morgan Inc. (NYSE: KMI) raised to ‘buy’ at Citigroup; (NYSE: CRM) started as ‘buy’ at ThinkEquity; Dean Foods Co. (NYSE: DF) cut to ‘neutral’ at Goldman Sachs; and Google Inc. (NASDAQ: GOOG) started as ‘neutral’ at Wedbush.

Earnings reports since markets closed last night have led to some price changes as of the last half hour of trading today: JPMorgan is up 5.8% at $36.00; Wells Fargo is up 3% at $33.83; Lexmark International Inc. (NYSE: LXK) is down -16.1% at $20.40 after posting a new 52-week low of $20.26 earlier today; and Ocean Power Technologies Inc. (NASDAQ: OPTT) is down -11% at $2.66.

On Monday we are scheduled to get earnings results from Citigroup Inc. (NYSE: C), J.B. Hunt Transport Services Inc. (NASDAQ: JBHT), Gannett Co. Inc. (NYSE: GCI), Robert Half International Inc. (NYSE: RHI), and Joe’s Jeans Inc. (NASDAQ: JOEZ).

Take a look at our preview of tech company earnings due next week, including heavyweights Intel Corp. (NASDAQ: INTC), Apple Inc. (NASDAQ: AAPL), Microsoft Corp. (NASDAQ: MSFT), and Google.

Some standouts from today include the following stocks:

Bridgepoint Educations Inc. (NYSE: BPI) is down -24.1% at $9.85 after posting a new 52-week low of $9.39 earlier today. The for-profit education company is in jeopardy of losing its accreditation. More coverage here.

Presidential Life Corp. (NASDAQ: PLFE) is up 36.6% at $13.$13.94 earlier today. The insurer is being acquired for $14/share, or $415 million.

Box Ships Inc. (NYSE: TEU) is down -17.8% at $6.67. The container shipping company priced a secondary offering of 30 million shares at $7/share, a discount of -14% to last night’s closing price.

Hovnanian Enterprises Inc. (NYSE: HOV) is up 8.9% at $2.81. The homebuilder has reached a $125 million land-bank agreement with The Blackstone Group LP (NYSE: BX).

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

  • 8:30 a.m. – Retail sales
  • 8:30 a.m. – Empire State manufacturing survey
  • 10:00 a.m. – Business inventories
  • 11:30 a.m. – 3- and 6-month bill auctions

Have a great weekend!

Paul Ausick

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