Equities Update: Late Slide on Job Jitters

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Includes: AMBC, CMCSA, GE, ICOC, SHLM
by: Midnight Trader

4:15 PM, Dec 3, 2009 --

  • NYSE down 65 (0.9%) to 7,157.05.
  • DJIA down 86 (0.8%) to 10,366.
  • S&P 500 down 9 (0.8%) to 1,100.
  • Nasdaq down 12 (0.5%) to 2,173.14.


GLOBAL SENTIMENT

  • Hang Seng up 1.19%
  • Nikkei up 3.84%
  • FTSE down 0.24%


UPSIDE MOVERS

(+) BAC annnounces TARP payback plan.

(+) ABK gets ratings upgrade for assurance unit at S&P.

(+) DRYS initiated at Buy rating at Deutsche Bank.

(+) GE, CMCSA announce NBC Universal deal

(+) PIR says Nov. same-store sales up 13.7%.

(+) APWR turns up despite missing with Q3 earnings.

DOWNSIDE MOVERS

(-) TGT says Nov. same-store sales down 1.5%.

(-) M says Nov. same-store sales down 6.1%, backs Q4 guidance.

(-) ARO continues evening slide seen after Q4 guidance straddles Street view.

(-) ANF says Nov. same-store sales drop 17%.

(-) PLCE says Nov. same-store sales down 13%.

(-) COST says Nov. same-store sales up 6%.

MARKET DIRECTION

Stocks pushed to new daily lows heading into the close, including a brief 100-point drop for the Dow Jones Industrial Average, as Wall Street braces for the latest monthly jobs report out early Friday. The DJIA closed down 86 points or 0.8%, the S&P 500 shed 0.8% and the Nasdaq dropped 0.5%.

Early gains gave way to broad declines after a surprise drop in the ISM's index for November. The index fell to 48.7% from 50.6% in October. That's well below economists' mean forecast for 51.5, since it's below 50, signals contraction.

The data helped erase early gains in stocks on a reported drop in weekly jobless claims. The number of Americans filing for state unemployment benefits fell by a seasonally adjusted 5,000 to 457,000 in the week ending Nov. 28. It was the fewest initial claims since September 2008 and the fifth weekly drop. The total number of people claiming benefits rose by 527,000 to 9.61 million, as a new program for extended benefits kicked in, MarketWatch reported.

In company news, Bank of America (NYSE:BAC) said late Wednesday it will pay back $45 billion in preferred stock issued to the government through the TARP program. Investors focused on that positive in the financial sector instead of mostly disappointing November same-store sales figures from the nation's retailers.

In a move to raise some of BAC's credit ratings this morning, Fitch analysts said "the strongest element of the transactions is the government's approval of Bank of America's capital plan. Fitch views the approval as a significant endorsement by the regulators that Bank of America now possesses adequate financial resources to manage through what is expected to be a challenging next several quarters."

Retailers' same-store sales for November mostly disappointed Wall Street, save for a few exceptions. The International Council of Shopping Centers, after two downward revisions, expects sales to rise between 3% and 4% across the industry. Mixed analyst notes have hit on expectations for December sales.

Comcast (NASDAQ:CMCSA) and General Electric (NYSE:GE) announced they have signed a definitive agreement to form a joint venture that will be 51% owned by Comcast, 49% owned by GE and managed by Comcast.

Ambac (ABK) jumped after S&P raised its counterparty credit rating on Ambac Assurance Corp., the bond insurance unit of Ambac, to CC, up from selective default, according to Reuters. The ratings agency cited an improved financial position.

ICO (ICOC) soared after A. Schulman (NASDAQ:SHLM) said late Wednesday it would buy ICOC for $105.0 million in cash and 5.1 million shares of SHLM common stock.

The European Central Bank left its key lending rate unchanged at 1%, as expected.

Gold fell on the ISM data but recovered to close at $,217.40 an ounce, after hitting a new record at 1,226.40.

Crude oil ends just lower, down 0.2% at $76.46 a barrel.