Today we have a bit of economic news due out, however, it is important to note that tomorrow is another Jobs Thursday and it will be quite interesting to see the numbers and whether the market really is heating up. That could put some brakes on recent price action and gains in the market. Our guess this morning, without getting too involved with the numbers at this point, is that we will come in under the current consensus. It is a Catch 22 situation because good numbers would encourage certain members of the US Fed to want to continue to stay on the sidelines and not act but poor numbers would hurt the market but force the Fed's hand. It is one of those situations where you must pick your poison.
We have our first set of economic news out today, and it is as follows (data set - consensus):
MBA Mortgage Index - N/A
Productivity Preliminary Number - 1.5%
Unit Labor Cost Preliminary Number - 0.4%
Crude Inventories - N/A
Looking at Asian markets we see markets are mostly higher:
All Ordinaries - up 0.50%
Shanghai Composite - up 0.16%
Nikkei 225 - up 0.88%
NZSE 50 - down 0.08%
Seoul Composite - up 0.87%
In Europe markets are lower:
CAC 40 - down 0.59%
DAX - down 0.48%
FTSE 100 - down 0.41%
OSE - down 0.77%
Sirius XM (SIRI), a stock we admittedly moved out of around the $2.15/share range jumped after the company's earnings report. We already knew that the results would be strong based on the subscriber reports that the company previously released. Shares finished up $0.10 (4.55%) for the day to close at $2.30/share on volume of 191.2 million shares. It was a strong day, and the company not only beat on earnings but also upped their outlook which pleased shareholders as it indicates the recent results will continue moving forward. It was a strong report and strengthens our belief that the deleveraging story will continue moving forward. As the free cash flow increases, so too shall the shares.
We have noticed that Clearwire (CLWR) has strung together a winning streak over the past few trading sessions with the shares up over 50% in that span. In yesterday's trading shares rose $0.08 (5.63%) to close at $1.50/share on volume of 15 million shares. The company still has issues going forward, such as where they will get the money to keep them funded in twelve months, but the big issues were covered in this quarter's conference call where we found out that they have enough cash to buy them the twelve months to find further financing. It certainly hasn't hurt that the risk-on trade has returned to the market and so long as that is the case we should see stocks such as Clearwire remain strong, although a pullback is due at this point.
MGM Resorts (MGM) reported earnings which beat expectations. Their quarterly loss was smaller than expected, but although the company surprised they did state that bookings for conventions were lower at this point which would affect results for the next quarter. The company turned in a quarter which was better than many competitors and highlights the company making some strides in China while also keeping an eye on expenses for the entire company. Shares were up $0.70 (7.46%) to close at $10.08/share on volume of 31.6 million shares. MGM is not our favorite play in the space, but this quarter's results stand on their own and were impressive.
It is funny how one quarter what results in a drag for the company can then turn around and be a driver for growth the next. That seems to be the case for Fossil (FOSL) which saw shares rise dramatically after the company released their earnings. Shares shot up $21.98 (31.49%) to close at $91.77/share on volume of 7 million shares. Last quarter results were below expectations due to Europe but shares got an added boost this quarter as the company stated that they saw Asia and Europe driving growth through the year. They even expect to add to the company owned store count moving forward, so it really is a bullish story going forward.
Tenet Healthcare (THC) shares rallied $0.42 (9.01%) finishing at $5.08/share on volume of 10.3 million shares after the company reported results ahead of expectations. Tenet exceeded estimates due to increased admissions and greater revenue derived from those patients although the company still ended up posting a loss. The company led the industry higher today, but for the year the shares are flat.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.