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4:26 PM, Dec 7, 2009 --

  • NYSE down 26.9 (0.4%) to 7,155.73.
  • DJIA up 1.21 (0.01%) to 10,390.
  • S&P 500 down 2.73 (0.3%) to 1,103.
  • Nasdaq down 4.7 (0.2%) to 2,190.


GLOBAL SENTIMENT

  • Hang Seng down 0.77%
  • Nikkei up 1.45%
  • FTSE down 0.16%


UPSIDE MOVERS

(+) S gets favorable coverage in Barron's.

(+) AKAM raises outlook.

(+) NVDA gains in wake of Intel decision to scrap graphics chip.

(+) CTIC says Pixantrone produces 250% improvement in 1-Year progression free survival in Lymphoma.

(+) NYB sets stock sale, discloses acquisition.

(+) AXP gets upgraded.

(+) DFS gets upgraded.

(+) CYTR announces positive data in Leukemia study.

DOWNSIDE MOVERS

(-) SOMX tumbles as FDA says NDA for Silenor can't be approved in present form.

(-) INTC scraps plans for Larrabee graphics chip.

(-) COF gives up early gains despite upgrade.

(-) CAL selling convertible notes.

MARKET DIRECTION

Stock averages end on either side of the flat line, giving back the initial gains seen in the wake of Fed Chairman Ben Bernanke's relatively soothing afternoon comments for Wall Street. Bernanke signaled continued low interest rates into 2010. Investors thought the Fed might begin to change its tune after a much-improved jobs report.

Ahead of the Bernanke speech, stock investors were skittish, waiting for signs on the scope and speed of 2010 interest-rate policy in the wake of freshly improved job market data out Friday. Bernanke, today, signaled a steady course for U.S. monetary policy, which was taken by some to mean that rates would hold near zero for the time being.

"Though we have begun to see some improvement in economic activity, we still have some way to go before we can be assured that the recovery will be self-sustaining," Bernanke said.

Bernanke's talk was titled "Frequently Asked Questions." The most frequently asked question of the Fed right now is: Will the Fed let inflation get out of hand?

"The answer is no," Bernanke said. "The Fed is committed to keeping inflation low and will be able to do so." However, inflation "appears likely to remain subdued for some time."

Stocks advanced on Friday after a report showed the U.S. economy shed just 11,000 jobs in November, much less than Wall Street expected. Stocks gained despite sharp declines late last week for high-flying gold and oil, as the greenback improved. Some analysts were noting that the stock market's resilience on Friday, even as the dollar improved, may signal a bottom for the dollar. Other analysts said it's too soon for such a call.

In company news, Akamai (AKAM) gains after saying it expects Q4 revs in the range of $230 to $235 mln and earnings of $0.42 to $0.43 per share, up from prior expectations of revs in the range of $217 to $224 mln and EPS of $0.39 to $0.41 per share. The Street view is $221 mln in revs and earnings of $0.40 per share.

Sprint Nextel (S) is the subject of a mostly positive Barron's feature this week. With an ill-timed and overpriced purchase of Nextel Communications in 2006, a costly build-out of its network, and an excess of debt entering the credit crisis, the No. 3 wireless-service provider squandered what goodwill it had on Wall Street, the article says.

Shares collapsed from 22 in mid-2007 to below 2 in November 2008. The disdain for Sprint Nextel's stock, now near 3.70, has persisted -- even as the company shows encouraging signs of a turnaround, the shares appear deeply undervalued and a relatively new chief executive reorients the business for a fresh growth phase. The result: a stock that few profess to like, even as it promises 50% upside potential.

Intel (INTC) dips after a report says the company has canceled plans for its first high-profile chip based on a design called Larrabee. An Intel spokesman told The Wall Street Journal that development was behind schedule. Intel doesn't plan to comment further on future versions of Larrabee until next year. The chip giant had expected the product to create graphics for video games and perform other complex computing work, the article said.

Shares of INTC's rivals jumped on the news. AMD (AMD( gets an additional boost from an upgrade to outperform from underperform at Sanford C. Bernstein. The broker's price goal for each share is $12 from $5.50.

Allos Therapeutics (ALTH) slides after a downgrade to market perform at Wells Fargo. The broker has a $6-7 target for each share.

Major banking and brokerage shares are mixed. Bank of America upgrades credit card companies American Express (AXP), Discover Financial (DFS) and Capital One (COF). COF slips into the red around midsession but the others hold gains.

Royal Bank of Scotland (RBS) and Lloyds (LYG) were lower after reports in the Financial Times and Bloomberg said the UK government is considering a direct tax on bankers' bonuses or a windfall tax on the banks themselves amid rising public anger over the likely hefty payouts in the sector.

In mergers and acquisitions news, Celgene (CELG) says it will acquire privately held Gloucester Pharmaceuticals for $340 million in cash plus $300 million in
future U.S. and international regulatory milestone payments.

LaJolla Pharmaceuticals (OTC:LJPC) says it will merge with Adamis Pharmaceuticals.

CF Industries Holdings (CF) announced it increased its offer for Terra Industries (TRA) by $4.75 in cash per share. CF is now offering to acquire Terra for $36.75 in cash and 0.1034 of a share of CF Industries common stock for each Terra share.

ZiLOG (ZILG) is higher on news it will be bought by IXYS (IXYS) for $3.58 per share in cash.

Source: Equities Update: Mostly Flat on a Light Day