Bloggy Business Today

By Ryan Vlastelica

NEW YORK |
Mon May 21, 2012 4:27pm EDT

NEW YORK (Reuters) – Stocks rose more than 1 percent on Monday, with the SP 500 snapping a six-day losing streak in a rebound from equities’ biggest weekly drop in almost six months, but Facebook slumped in its second session after a disappointing debut.

Tech shares .GSPT were among the day’s biggest gainers, with an SP sector index surging 2.8 percent on the strength of Apple Inc (AAPL.O). Shares of Apple climbed 5.8 percent to $561.28, leading the Nasdaq to its biggest one-day percentage gain since December 2011.

Facebook Inc (FB.O), the social networking giant that fell short of lofty expectations last week, fared no better on Monday. Facebook’s stock sank 11 percent in its second day of trading, dropping to $34.03, well below its $38 issue price.

“Institutional buyers weren’t as enamored with Facebook as retail investors were, so it isn’t a surprise to see them taking their liquidity out for other areas,” said John Norris, managing director of wealth management with Oakworth Capital Bank in Birmingham, Alabama.

Investors are watching the 1,300 to 1,290 range on the SP 500 as a major support level, the lower end of which was tested last week after the benchmark index had fallen 7.8 percent since the end of April. The bottom of the range coincides with the SP 500′s 10-month moving average.

Sentiment improved after G8 leaders gave verbal backing for Greece to stay in the euro and stressed over the weekend that their “imperative is to promote growth and jobs.” Greece is expected to hold elections after the country was unable to form a government following its most recent elections.

The Dow Jones industrial average .DJI jumped 135.10 points, or 1.09 percent, to 12,504.48 at the close. The Standard Poor’s 500 Index .SPX climbed 20.77 points, or 1.60 percent, to 1,315.99. The Nasdaq Composite Index .IXIC rose 68.42 points, or 2.46 percent, to close at 2,847.21.

In another factor helping sentiment, China’s premier called for additional efforts to support growth on Sunday, signaling Beijing’s willingness to take action after a recent series of economic indicators suggested that the world’s second-biggest economy will slow further in the second quarter.

“We’ve been in something of a near panic lately, and after so many down days, it was inevitable that we would bounce back, especially with news indicating that things aren’t falling apart,” Norris said.

Facebook shares were expected to face tough trading this week if lead underwriter Morgan Stanley

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By Angela Moon

NEW YORK |
Fri May 18, 2012 6:35pm EDT

NEW YORK (Reuters) – Normally a big decline would set up Wall Street for a technical rebound. But that may not be the case next week, even after the market posted its worst weekly loss for the year and the SP fell for six straight sessions.

With the corporate earnings season drawing to an end and recent U.S. economic data raising doubts about the pace of growth, the SP 500, which is down 7.3 percent so far in May, could decline further next week as concerns about the financial health of Europe persist.

“What has changed in the world since April? We went from hearing a constant refrain that the world is awash in money and markets must go higher to hearing nobody wants to take any risk. … All in a week,” said Peter Cecchini, global head of institutional equity derivatives at Cantor Fitzgerald Co in New York.

The SP 500 fell 4.3 percent for the week, its steepest weekly decline this year, and closed below 1,300 for the first time in four months.

The hotly awaited market debut of Facebook on Friday was marred by technology glitches on the Nasdaq in sending messages back to the brokerages that handled orders of Facebook Inc (FB.O) for individual, or “retail,” investors. Those problems rekindled fears about the market’s electronic trading system and caused some investors to stay away from equities.

Weighing on sentiment is a growing sense among investors that the euro zone debt crisis is nearing new heights, fueled by fears of the potential for a Greek euro exit and the deteriorating health of the Spanish banking system.

Solid corporate earnings and upbeat U.S. economic indicators had fueled the rally in U.S. stocks, offsetting jitters over Europe. But with earnings almost out of the way and data starting to disappoint, investors have shifted their focus back to headlines out of Europe.

Leaders of the Group of 8 major industrial economies meet this weekend to try to tackle the financial crisis in Europe. U.S. President Barack Obama, the G8 host, has urged European leaders repeatedly to do more to stimulate growth, fearing contagion from the euro crisis that could hurt the U.S. economy and his chances of re-election in November.

“The market is extremely oversold. Nonetheless, all major indicators remain on sell signals,” said Larry McMillan, president of options research firm McMillan Analysis Corp, in a report on Friday.

“We expect a powerful but short-lived rally should

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By Chuck Mikolajczak

NEW YORK |
Fri May 18, 2012 5:21pm EDT

NEW YORK (Reuters) – Stocks fell on Friday after a sloppy debut by Facebook Inc (FB.O) spoiled hopes that a spectacular open for the most-anticipated stock sale in years would brighten the mood in what has been a gloomy month for equity markets.

Shares of Facebook, the social networking giant, were volatile in the busiest day ever for a trading debut. After early gains of more than 10 percent, Facebook shares fell back to the $38 issue price, ending up just 0.6 percent at $38.23.

It was the Nasdaq’s most actively traded stock, with more than 566 million shares traded.

“When Nasdaq started running into some problems early on before Facebook opened – when there was a sense they kept putting it off, putting it off, the market did come under a little bit of pressure because people were getting nervous about it,” said Ken Polcari, managing director at ICAP Equities in New York.

The SP 500 dipped below 1,300, seen as a key support level, for the first time since mid-January. Investors were cautious before leaders of the Group of Eight nations met about the euro zone debt crisis.

After delays in the scheduled start of Facebook trading raised anxiety levels among traders and onlookers outside Nasdaq’s headquarters, the stock opened at $42.05, compared with an initial public offering price of $38 a share. It rose as high as $45 before pulling back.

Investors were left in the dark about whether their buy and sell orders on Facebook went through as the Nasdaq did not tell broker/dealers whether opening trades had been executed. Nasdaq did not disseminate execution data until 1:50 p.m. (1750 GMT).

“The fact that there is this much interest in a big capital raise, an event like this is good for the markets overall,” said Gordon Charlop, a managing director at Rosenblatt Securities in New York.

The SP 500 fell for a sixth straight day and recorded its worst week since November on growing concerns that global growth will suffer from the euro zone’s problems and signs of a slowing U.S. recovery.

The broad index has dropped 7.3 percent so far in May.

The Dow Jones industrial average .DJI dropped 73.11 points, or 0.59 percent, to 12,369.38. The Standard Poor’s 500 Index .SPX lost 9.64 points, or 0.74 percent, to 1,295.22. The Nasdaq Composite Index .IXIC fell 34.90 points, or 1.24 percent, to 2,778.79.

For the week, the Dow fell 3.5 percent, the SP 500

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By Chikako Mogi

TOKYO |
Thu May 17, 2012 2:16am EDT

TOKYO (Reuters) – Asian shares recovered some ground on Thursday from the previous day’s sell-off, but investors found little reason to chase risk amid deepening turmoil in Greece and fears of contagion to other stressed euro zone economies.

Against a background of financial instability in Greece’s banking sector, European shares were set to start mixed, with financial spreadbetters predicting that major European markets would open between a 0.2 percent drop and a 0.1 percent rise. U.S. stock futures were up 0.6 percent.

Gold and the euro recouped most of their losses from Wednesday as signs of stability in share markets helped improve sentiment slightly, but Brent bore the brunt of general risk aversion, slipping to a near four-month low.

MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS rose 1 percent on short covering, after sliding more than 3 percent – its biggest one-day drop in six months – and hitting a new four-month low on Wednesday. The index has shed about 8 percent so far in May.

Bucking the general trend of recovery in Asia-Pacific, Australian shares fell to a four-month low, with banks easing on more signs of pressure on margins.

Japan’s Nikkei stock average .N225 gained 0.7 percent.

News on Wednesday that some Greek banks face emergency funding needs dealt a further blow to risk sentiment, already beaten down by worries about much slower economic growth in China, a fragile U.S. jobs market and a shock trading loss at JPMorgan Chase Co (JPM.N).

“May is typically a bear month for markets as players often look to take advantage of the saying, ‘sell in May and go away,’ but all the negative factors compounded to give momentum to sell risk assets indiscriminately,” said Bob Takai, general manager of Sumitomo Corp’s energy division, adding that the markets will likely remain depressed for the next two to three quarters.

The European Central Bank said it has stopped providing liquidity to some Greek banks that have not been successfully recapitalized.

Greece on Wednesday put a senior judge in charge of an emergency government to lead the nation to its second election in just over a month on June 17. The vote will likely determine whether the highly indebted country remains in the common currency area.

The head of the World Bank warned on Wednesday that a decision by Greece to leave Europe’s common currency zone would raise big questions about the impact on Spain, Italy and other euro zone countries

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By Chuck Mikolajczak

NEW YORK |
Tue May 15, 2012 5:26pm EDT

NEW YORK (Reuters) – Stocks fell for the eighth day in the past 10 on Tuesday as uncertainty stemming from the political stalemate in Greece gave investors another reason to be cautious and sellers came out in force late in the session.

The SP 500 fell for the third straight session as attempts to form a government in Greece fell apart, raising the possibility of a rejection of the bailout terms spelled out by the European Union for the fiscally troubled nation.

After holding near the unchanged mark for much of the session, stocks moved lower in the absence of positive news to turn the tide of negative sentiment.

“Those who are looking for a little bit of a bounce off the last eight trading sessions lost their nerve because there is really nothing out there to indicate the broader story has changed,” said Peter Kenny, managing director at Knight Capital in Jersey City, New Jersey.

The concerns about upheaval in the euro zone and its effect on the global economy weighed on energy and materials stocks, with U.S. crude down for the third straight day. The SP energy index .GSPE and the SP materials index .GSPM each dropped 1.5 percent.

Quarterly results helped boost retailers TJX (TJX.N), up 6.9 percent at $42.45, and Dick’s Sporting Goods (DKS.N), up 5.9 percent at $50.05.

U.S. retail sales rose 0.1 percent in April, slightly below expectations. However, details in the Commerce Department’s report indicating underlying strength in demand and a rebound in manufacturing activity in New York State calmed concerns that the economy was stalling.

The declines on Tuesday pushed the SP 500 down more than 6 percent from its early April high, leaving some investors optimistic that the pullback may be nearing an end as stock prices become more attractive.

“We could go a little lower, but not much lower. It’s hard to ignore the fundamentals – and clearly there are some good fundamentals and prices,” said Mark Martiak, senior wealth strategist at Premier/First Allied Securities in New York.

Data showing an index of home builders’ sentiment at a five-year high in May helped lift the sector’s shares. The PHLX housing index .HGX advanced 0.6 percent. But Home Depot (HD.N) shares lost 2.4 percent to $48.67 and ranked as the biggest drag on the Dow after the home improvement retailer posted quarterly sales that fell short of Wall Street’s expectations.

The Dow Jones industrial average .DJI dropped 63.35 points, or

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