Get RSS Feed
9:05am (EST)
The market got a breath of fresh air on Tuesday and the bulls needed it after watching the Dow fall below 10,000 on Monday. Futures were already pointing towards a slightly higher open yesterday morning but shortly before Wall Street’s lunch hour news broke on a possible rescue package for Greece.
The market soared in seconds and stayed in a solid uptrend for well over an hour before giving back some of its gains close. The Dow managed to finish with a 150 point gain and closed at 10,058. The S&P 500 added 14 ticks and closed at 1,070 while the Nasdaq tacked-on 25 points to settle at 2,150.
In earnings news, Walt Disney (DIS, $29.84, up $0.36) reported profits of $0.44 a share, down from $845 million, or $0.45 a share, from a year ago but still good enough to beat Wall Street’s figures.
Revenue came in at $9.7 billion. If you do some fancy accounting and exclude certain items which all companies do, Disney actually earned 47 cents a share. That beat the 38 cents the suit-and-ties put on the board for the company’s profits.
From the “Imagine That” department…Airgas (ARG, $61.35, up $0.80) announced that its board has unanimously rejected the buyout proposal from Air Products & Chemicals (APD, $67.95, down $0.20). The deal was announced last Friday and we told you that there had already been two previous offers.
It looks like APC will have to go hostile if it wants Airgas.
Look for some Fed news out at 10am on how they plan to unwind stimulus measures without sending the nation back into recession. As we head to press, Dow futures are up 10 points to 10,014 while the Nasdaq futures are higher by 2 to 1,753. S&P 500 futures are flat at 1,066.
Rally Cools As Bears Push Back
Wednesday, May 12th, 2010
9:00am (EST)
The bulls failed to carry Monday’s momentum over into Tuesday as the market started lower and struggled for much of the day. The market slipped as optimism waned following the $1 trillion European rescue package. We didn’t have a triple-digit close on the Dow for the first time in five trading sessions although the index did move within a 200 point range.
The bulls did manage to push the market into positive territory for a few hours and trading was choppy going into the close before the bears pulled out the victory by taking two out of the three indexes.
The Dow traded to a high of 10,874 before falling back to close with a loss of 37 points, or 0.3%, to finish at 10,748. The index is trading a little above the 10,800 level we are watching and did finish the day below it. Sometimes you will see a stock or index “stretch” their support or resistance lines but the action is telling us Dow 10,200-10,250 is in the cards. A break below this level means we are going back under 10K.
The S&P 500 fell 4 points, or 0.3%, and settled at 1,155 after reaching a high of 1,170. We said in yesterday’s morning update the index could run to 1,170 and that is where the door was slammed. The bulls are trying to push past this second wave of resistance but once we fall below 1,150 we think the index could test 1,075 over the short-term.
The Nasdaq ended the day fractionally higher but by less than a point and closed at 2,375. The index reached a high of 2,405 but slipped at resistance once again despite an upbeat earnings forecast from Intel (INTC, $22.28, down $0.27). We can see 2,200-2,100 on the horizon.
Tech did manage to hold up but if you are a current bull then you had to be disappointed that Intel finished in the red. The company said that they expect revenue and earnings per share to grow at a double-digit rate as the market for personal computers continues to be robust. Intel went on to say that most of the growth will come from China and India.
Turning to earnings, Walt Disney (DIS, $35.76, up $0.47) is trading lower this morning despite posting better-than-expected results. The company posted a profit of $953 million, or $0.48 a share, versus $613 million, or $0.33 a share, in the year ago quarter. Revenue rose 6% to $8.6 billion. Analysts were looking for revenue of $8.4 billion and $0.45 a share.
Wall Street must have felt shares were a little overpriced and obviously they are a little disappointed that Disney’s media networks didn’t perform as well as their movie studios. Shares are lower by 3% this morning and are at $34.65, down $1.11, in pre-market trading.
As we head to press, the bulls are showing a little life this morning as futures are pointing towards a slightly higher open. Dow futures are up 34 points to 10,743 while the S&P 500 futures are up 5 to 1,158. The Nasdaq 100 futures are advancing 10 points to 1,945.
Tags: call options, DIS, INTC, option picks, option signals, options alerts, put options, stock options trading, Walt Disney earnings
Posted in Earnings, Market Analysis, Market Commentary | Comments Off