Stocks Advance On Jobs, Housing Data

 |  Includes: DIA, QQQ, SPY
by: Midnight Trader
  • Dow Jones Industrial Average up 46.02 (+0.36%) to 12,984.69
  • S&P 500 up 5.80 (+0.43%) to 1,363.46
  • Nasdaq Composite up 23.81 (+0.81%) to 2,956.98


  • NIKKEI 225 up 0.44%.
  • Hang Seng Index down 0.78%.
  • China Shanghai Index up 0.25%.
  • FTSE 100 up 0.36%

U.S. stocks finished higher after new jobless claims last week held near four-year lows, while a big drop by Hewlett Packard Co. (NYSE:HPQ) following disappointing financial results last night kept a lid on most of the major averages.

New applications for unemployment benefits stayed at 351,000 during the week ended Feb. 18, the slowest pace since March 2008. That beat the 355,000 claims experts polled by Bloomberg News anticipated and bolstered confidence that a recovery in jobs is continuing.

Hewlett Packard shares finished lower after guiding fiscal Q2 and FY12 earnings below expectations. The computer manufacturer said it likely will earn between $0.88 to $0.91 per share during the current quarter, trailing the average call by analysts of $0.95 per share. For FY 2012, HPQ confirmed its EPS forecast of $4.00 per share while the Street is at $4.08 per share. HPQ's fiscal Q1 results were in-line with the consensus.

The S&P 500 Index wasn't negatively impacted by HPQ's results, trading near a 10-month high. The Dow Jones Industrial Average was able to finish higher as did the Nasdaq Composite.

In company news, several retailers finished higher after posting better-than-expected earnings results. Target Corp. (NYSE:TGT) shares climbed after reporting a $1.49 per share Q4 profit, handily beating estimates. OfficeMax (NYSE:OMX) finished higher after also topping analyst expectations, reporting Q4 earnings of $0.17 a share versus the consensus $0.14 EPS.

Sears Holdings (NASDAQ:SHLD) advanced on plans to sell 11 Sears full line store locations to General Growth Properties for $270 million. The department store retailer also said it intends to separate its Sears Hometown and Outlet businesses, along with certain hardware stores, through a proposed rights offering expected to raise between $400 million to $500 million. SHLD's Q4 EPS of $0.54 trailed forecasts by wide margin although its $12.5 billion in revenues managed to just beat the Street view.

Shares of several pharmaceutical companies with prospective anti-obesity drugs closed sharply higher after an advisory panel for the U.S. Food and Drug Administration overwhelmingly recommended Vivus' (NASDAQ:VVUS) Qnexa drug candidate be approved for U.S. sales. The vote, the next-to-last step needed before Qnexa can reach the market, had VVUS shares closing higher.

Orexigen Therapeutics (NASDAQ:OREX) shares closed higher after the company and the FDA struck a deal on testing guidelines for its investigational weight loss drug, Contrave. OREX had received a Complete Response Letter to its New Drug Application late last month and will now conduct additional studies prior to approval to ensure Contrave does not unacceptably increase the risk of major adverse cardiovascular events.

The gains for VVUS and OREX also had a positive effect on Arena Pharmaceuticals (NASDAQ:ARNA), which also advanced. Like VVUS and OREX previously, Arena's anti-obesity drug lorcaserin was turned down by an FDA advisory panel in September 2010. The FDA reportedly has also been under some pressure, including by a U.S. Senate committee, to speed its decision process for obesity drugs, citing the lack of approved medications for "a significant unmet medical need."

Shares of GrafTech (GTI) plummeted despite posting Q4 earnings that beat the Thomson Reuters consensus. Revenue of $348 million was shy of analyst expectations which stood at $363.42 million for Q4.

Most of the S&P industry sectors ended higher, led by financial and technology stocks, each rising about 0.6%. Utilities and industrial stocks closed lower while consumer staple companies ended flat.

Crude-oil futures advanced, gaining 1.5% and settling at their highest since May. There was a smaller-than-expected increase in weekly inventories and a lower dollar. Oil for April delivery settled at $107.83 a barrel on the New York Mercantile Exchange. Natural gas ended lower.

Gold and silver rose, with gold for April delivery up $15 to settle at $1,786.30 an ounce in New York COMEX trading while silver closed up more than 3% today at $35.56 an ounce.


(+) ONVI, Rejects $4.25-a-share take-over bid by Symphony Tech

(+) SMSI, Software-maker climbing despite 68% drop in Q4 sales

(+) LVLT, Communications maker gets upgrade from Morgan Stanley

(+) MELA, Drug company up on positive study results


(-) AWAY, Break-even Q4 well below $0.09 a share in Street view

(-) PVA, 2012 guidance falls short of most forecasts

(-) TSL, Reported Q4 loss of $0.93 per ADS