Jim Cramer Blog

The stock market traded cautiously today, ultimately declining on a lack of economic news and few high-profile merger announcements or other news to encourage buying. Quite the opposite occurred, with two potential deals collapsing over the weekend. Investors were also wary ahead of Congressional testimony from Federal Reserve Chairman Ben Bernanke on Wednesday, at which time he'll discuss the state of the economy. Oil prices retreated sharply, closing under $58 a barrel, while the 10-year Treasury note also fell, with the yield rising two basis points to 4.80%.
The most prominent deal to collapse was the second failed attempt by the NASDAQ Stock Market (Nasdaq: NDAQ - News) to acquire the London Stock Exchange. The LSE's shareholders overwhelmingly rejected NASDAQ's $5.3 billion merger offer on Saturday, agreeing with management that the offer undervalued the European exchange. NASDAQ's shares declined -6% in today's trading. Also falling apart were merger talks between French-based pharmaceutical Sanofi-Aventis (NYSE: SNY - News) and Bristol Myers-Squibb (NYSE: BMY - News), according to published reports in London over the weekend. That news sent the former slightly higher but the latter down -3%. Elsewhere, Canada-based aluminum producer Novelis (NYSE: NVL - News) added 13% after it agreed to be acquired by Indian metals producer Hindalco Industries for $3.6 billion. Four Seasons Hotels (NYSE: FS - News) slid -3% on news it would go private in a management-led buyout.
In business news, biotech Onyx Pharmaceuticals (Nasdaq: ONXX - News) skyrocketed after it reported a successful trial that extends the uses of its principal product. The California company's market value nearly doubled, gaining 97%, after it announced that its cancer treatment Nexavar "significantly" improved the survival rates of patients with advanced liver cancer. The Phase III trial was stopped early so that all patients in the trial could have access to the drug. Nexavar, jointly marketed with Bayer (NYSE: BAY - News), is presently only approved for the treatment of kidney cancer. Analysts speculated that Bayer might move to acquire Onyx based on the trial results.
Partly rebounding from recent selling was Apple (Nasdaq: AAPL - News). The stock's 2% climb today was fueled in part by an upgrade by Citigroup, which raised its rating on Apple to "buy" from "hold." Citigroup cited the expectation for significant new product releases from Apple as the basis for its recommendation. Citigroup's change is in contrast to that of Goldman Sachs, which removed Apple from its "Americas Conviction Buy List" last Thursday due to "negative speculation" in advance of Apple's launch of the iPhone.
Elsewhere, new Home Depot (NYSE: HD - News) CEO Frank Blake reversed a key strategic direction pursued by the company's former boss Robert Nardelli. The home repair retailer said it would examine strategic alternatives for its wholesale supply business. Under Nardelli, Home Depot expanded into the lower-margin wholesale business as part of a diversification plan. Large shareholders had long criticized the move as a distraction from Home Depot's core retail business. The stock finished up 1%.
By the BullMarket.com Staff

Labels: AAPL, BAY, BMY, FS, HD, NDAQ, NVL, ONXX, SNY

Shares of American Express Co. were the heaviest weight on the Dow Jones industrial average on a down day for the markets at midday Monday.
The index of 30 leading copanies was down 9.69, at 12,571.22.
Shares of New York-based American Express were down 97 cents to $56.56 as concerns about credit quality continued to spread across the financial services industry following announcements last week from mortgage companies about increasing defaults, and a report early Monday on increased foreclosure activity in January.
Shares of The Walt Disney Co. were down 45 cents, to $33.91, despite an upgrade from CIBC World Markets to "Sector Performer," from "Underperform."
Boeing Co. shares edged down 62 cents, to $80.39. Lehman Brothers analyst Joseph Campbell reiterated an "Overweight" rating and a $105 price target on the shares Monday, but wrote in a client note the shares were valued well above average for the industry, and outlined concerns about the risks the company faces trying to ramp up its 787 aircraft program on schedule and on budget.
On the upside, shares of alumina maker Alcoa Inc. added 65 cents, or 2 percent, to $33.17 on news that Canadian aluminum producer Novelis Inc. is being acquired by Hindalco Industries of India. Morgan Stanley analyst Marke Liinamaa noted the $6 billion deal highlights the value of Alcoa's downstream operations.
Shares of Home Depot Inc. gained 53 cents, to $41.53, on news the Atlanta-based home improvement chain is considering selling its Home Depot Supply business, which it bought last year for $3.2 billion.
And shares of Coca-Cola Co. were up 52 cents, to $48.28, as Wall Street speculated it may beat expectations when the Atlanta-based beverage company reports fourth-quarter results on Wednesday.
Published by AP

Labels: AA, AXP, BA, DIS, HD, KO, MS, NVL

Wall Street extended its losses Monday as investors awaited a stream of key economic data this week and were left disappointed by the collapse of several closely-watched acquisition deals.
The markets, which pulled back last week amid concern about inflation's impact on interest rates, traded cautiously with Federal Reserve Chairman Ben Bernanke set to speak before Congress on Wednesday. Government data due on Friday will shed new light on wholesale inflation and the state of the housing market.
Unlike recent Monday mornings, there was a dearth of acquisition announcements to give the market a lift. Instead, investors had to deal with news that the Nasdaq Stock Market Inc. failed in its bid to buy the London Stock Exchange and that French drugmaker Sanofi-Aventis called off talks for a possible deal with Bristol-Myers Squibb Co.
Onyx Pharmaceuticals Inc. and Bayer AG advanced after the companies released data from a clinical trial that shows an experimental drug is effective in fighting liver cancer. Apple Inc. moved higher after being upgraded in anticipation of big product launches set this year.
Wall Street fell last week on concerns about higher oil prices and the possibility inflation could lead to higher interest rates. With fourth-quarter earnings reports nearly over, investors have traded hesitantly as they wait for some kind of catalyst to give them direction
In midmorning trading, the Dow Jones industrial average fell 13.62, or 0.11 percent, to 12,567.21.
Broader stock indicators declined. The Standard & Poor's 500 index was down 2.93, or 0.20 percent, at 1,435.13 and the Nasdaq composite index retreated 8.62, or 0.35 percent, to 2,451.20.
Bonds edged lower ahead of economic data due out this week, with the yield on the benchmark 10-year Treasury note rising to 4.79 percent from 4.78 percent late Friday. The dollar was mixed against other major currencies, while gold prices dropped.
Oil, which advanced last week as cold weather was seen increasing heating demand, was down on the New York Mercantile Exchange. A barrel of light sweet crude fell $1.21 to $58.68.
Nasdaq, the world's largest electronic equities exchange, edged lower after LSE shareholders did not approve its bid to acquire the British bourse. Shares fell $1.82, or 4.9 percent, to $35.38. Bristol Myers tumbled $1.41, or 4.9 percent, to $27.11 after a report that Sanofi-Aventis called off deal talks amid a disagreement over price.
But aluminum producer Novelis Inc. rose $5.31, or 13.7 percent, to $43.85 after it agreed to be bought by India's Hindalco Industries Ltd.
Apple, which recently unveiled plans to roll out its long-anticipated iPhone, rose $1.06 to $84.33 after it was upgraded by a Citigroup analyst. Meanwhile, good news about a potential treatment for liver cancer sent Bayer up 17 cents to $58 and Onyx up $6.42, or 52.3 percent, to $18.68.
The Russell 2000 index of smaller companies was down 2.06, or 0.26 percent, at 805.05.
Overseas, Japan's markets were closed. In afternoon trading, Britain's FTSE 100 was down 0.31 percent, Germany's DAX index fell 0.54 percent, and France's CAC-40 was fell 0.62 percent.
Published by Joe Bel Bruno, AP Business Writer

Labels: AAPL, BAY, BMY, NDAQ, NVL, ONXX, SNY

Stocks are trading mixed Monday morning amid falling crude oil prices and another round of merger activity. Shortly after the opening bell on Wall Street, the Dow Jones Industrials ($INDU) was up 20 points on the session. The NASDAQ ($COMPQ) was trading modestly lower.Several deals were announced. India’s Hindalco is buying out Novelis (NVL) for approximately $6 billion. Shares of the aluminum company are up $5.40 to $43.94 on the news. Four Seasons Hotels (FS) is going private for $82 a share, or roughly $3.37 billion. Tenaris SA is making plans to buy Hydril (HYDL) at a 17% premium from last Friday’s closing price. The deal values the maker of steel valves and connectors at approximately $2.2 billion.
In other stock news, Apple Computer (AAPL) is trading higher after Citigroup raised the rating on the stock to “buy” from “hold.” Onyx Pharmaceuticals (ONXX) is rallying after the company said its Nexavar cancer drug, developed jointly with Bayer AG, helped patients with liver tumors live longer. Google (GOOG) is trading lower after a group of media companies accused the company of “benefiting from the sale of pirated movies and providing business support to two Web sites suspected of offering access to illegal film downloads,” according to Dow Jones Newswires, citing people familiar with the matter.
Crude oil prices are moving lower after reaching more than $60.00 a barrel last week. Crude was recently down 99 cents to $58.90 a barrel. Exxon Mobile (XOM), ConocoPhillips (COP) and other energy-related shares are trading lower as well. No economic data is due out today, but the calendar is busy later in the week. Retail sales and business inventories are due out Wednesday. Industrial Production and the Philadelphia Fed follow on Thursday. Friday holds key data on housing and inflation.
Traders will also be watching the tone of the market after the sell-off late last week. On Friday, volume rose to its best levels of the week as the Dow slid 57 points and the NASDAQ tumbled 28. It turned out to be the most volatile trading session of the week and now traders will want to see if the major averages will rebound from the one-day debacle as they have in the recent past or if selling pressure is beginning to build, which could set the table for a long awaited market pullback or correction.

Frederic Ruffy of Optionetics.com

Labels: AAPL, COP, FS, GOOG, HYDL, NVL, ONXX, XOM