Ultimate Market Recap: Eastman Kodak Prepares for Bankruptcy, Barnes and Noble Sinks 30%

Thursday Morning’s Top Stories

China’s (NYSE:FXI) 2011 trade surplus dropped to $160 billion from 2010′s $183.1 billion, according to China’s Commerce Minister Chen. In December, China had recorded about a $21.6 billion surplus, representing a four-month high and a large rise from November’s $14.5 billion.

Reuters reported that if the December surplus figure is correct, it would come in higher than market estimates at $8.8 billion. In statement on the Ministry’s website, it noted that the world economy faces a “stern and complicated” situation in 2012 and that a recovery would be slow and likely to face challenges.

Nokia Corporation (NYSE:NOK) may nominate board member Risto Siilasmaa as chairman to succeed Jorma Ollila, according to Bloomberg. The company will report will its fourth-quarter results on January 28 and the nomination committee will probably meet at the same time. Company shares rose after receiving an upgrade from Credit Suisse (NYSE:CS) analysts.

Eastman Kodak Co. (NYSE:EK) is getting ready to seek bankruptcy protection in the next few weeks, the Wall Street Journal reported. The 131-year-old company is trying to sell a portion of  its patent portfolio as a last ditch effort to avoid Chapter 11. Meanwhile, the company is still preparing for a filing and talking to banks for financing around $1 billion to keep it going during bankruptcy.

Elan Microelectronics Corp. has reached a settlement with Apple Inc. (NASDAQ:AAPL) for the patent-infringement complaints against each other, beginning in 2010. Elan released a statement that said a settlement had been reached after the U.S. International Trade Commission ruled in June that Apple hadn’t violated one of two patents alleged in Elan’s complaint. It did not include details about the length of time between the ruling and the settlement or the nature of the patents. Apple will pay Elan $5 million and both companies have agreed to cross-license the patents at the center of the dispute, according to MarketWatch.

Thursday Morning Hot Stocks

Shares of Eli Lilly & Co. (NYSE:LLY) are down more than 3 percent early Thursday, as the company says 2012 profit could fall 20 percent.  Lilly said it sees 2012 earnings of $3.10 to $3.20 per share, well below the mean estimate of $3.61 per share among analysts surveyed by Thomson Reuters.  Other drug companies such as Pfizer Inc. (NYSE:PFE) and Bristol Myers Squibb Co. (NYSE:BMY) also traded lower.

Monsanto Co. (NYSE:MON) shares are jumping 1.8 percent as earnings came in better-than-expected.  For the quarter ended Nov. 30, Monsanto reported a profit of $126 million, or 23 cents a share, compared with a year-earlier profit of $9 million, or 2 cents a share.

Don’t Miss: These 5 CEOs Made Bank on Rising Share Prices in 2011.

Shares of Nordstrom Inc. (NYSE:JWN) and Macy’s (NYSE:M) are increasing 1.2 percent and .50 percent, respectively.  Nordstrom reported a boost in same-store sales of 8.7 percent, while Macy’s doubled its dividend.  Shares of retailer Kohl’s (NYSE:KSS) are trading lower as its same-store sales decreased .10 percent. Target (NYSE:TGT) is also trading lower after reporting softer-than-expected holiday sales.

Barnes & Noble (NYSE:BKS) shares plummeted 30 percent after the company said it is looking at options to spin off Nook, its e-book reader.  “We see substantial value in what we’ve built with our Nook business in only two years, and we believe it’s the right time to investigate our options to unlock that value,” William Lynch, the firm’s CEO, said in a press release.  The Nook competes with Amazon’s (NASDAQ:AMZN) Kindle and Apple’s (NASDAQ:AAPL) iPad lineup.

J.C. Penny Co. (NYSE:JCP) shares are down more than 5 percent. J.C. Penney, the third largest department store chain, said fourth-quarter profit would come to 65 cents to 70 cents a share. It had projected profit of as much as $1.15. Analysts estimated $1.08 on average.

Gap Inc. (NYSE:GPS) shares fell 5 percent after announcing that sales at stores open at least one year declined 4 percent.  Analysts, on average, had expected same-store sales to fall 1.3%, according to Thomson Reuters.

Don’t Miss: A Look at Last Year’s Chemical Deals.

Thursday’s Trending Stocks

As the DJIA and S&P 500 Index are receiving a mid-day lift, the following companies are hitting headlines with news catalysts:

Molycorp, Inc. (NYSE:MCP): Today Molycorp, Inc. shares are trading lower 1%. Molycorp said 78 percent of the Phase 1 rare earth produced in the company’s new Mountain Pass, California manufacturing facility, which becomes active in 2012, has been dedicated to the manufacturing of the Company’s XSORBXA water treatment products or is already held by customer contracts. The company announced it has signed agreements with customers covering 58 percent of its Phase I production, and has assigned another 20 percent to the production of XSORBXÂ, for a total of 78 percent of the 19,050 metric tons of rare earth oxide equivalent that it expects to produce each year under Phase 1 at its flagship rare earth facility in Mountain Pass, California. The company also noted that an additional six percent of Phase 1 production is in final stage discussions with customers.

Mosaic Co (NYSE:MOS): Mosaic Co shares are trading higher following the company’s latest earnings release.  On the company’s Q2 earnings call, the CEO said: “Corn prices are well ahead of historical levels and farmers are getting powerful signals to produce more. Farm economics remain strong and underpin record global phosphate and potash demand forecasts. There is more confidence among farmers than crop input distributors, as evidenced by large pre-paid purchases before year end. These purchases by farmers will eventually end up in our order book.”

Nokia (NYSE:NOK): Credit Suisse upgraded Nokia to Outperform from Underperform. Smartphones now make up 55 percent of total handset sales in the Taiwan market

Dendreon (NASDAQ:DNDN): A couple of good quarterly reports could help Dendreon’s shares can make their way back to the $20′s, said JP Morgan. The analyst sees risk/reward as positive and restates its Overweight rating.

Microsoft (NASDAQ:MSFT): CNet says the appearance of a new patent is feeding suspicions that Microsoft’s (NASDAQ:MSFT) forthcoming Xbox will include a DVR application, according to CNet.

Market Recap

Markets closed mixed on Wall Street today: Dow-0.02%, S&P +0.29%, Nasdaq +0.81%, Oil  -1.45%, Gold +0.68%.

On the commodities front, Oil (NYSE:USO) fell to $101.72 a barrel. Precious metals were up, with Gold (NYSE:GLD) rising to $1,623.70 an ounce while Silver (NYSE:SLV) climbed 0.62% to settle at $29.28.

Hot Feature: Discounts Boost December Retail Sales But Hurt Profit Margins

Today’s markets were mixed because:

1) Euro. Stocks fell sharply in early trading today after the euro declined to a 15-month low versus the dollar. The sell-off came as investors were rattled by more turmoil in European sovereign debt markets. French borrowing costs climbed at a bond auction today where the government fell slightly short of its fundraising goal. Spanish bond yields popped after a government official said Wednesday that Spanish banks would need to set aside another 50 billion euros as part of a restructuring of the nation’s financial sector, and Italian yields again jumped back above the key 7 percent level. And though the European Financial Stability Facility received decent demand for its new three-year bonds, it paled in comparison to demand for its 10-year bond offering last January.

2) Jobs. The Labor Department today reported that initial claims for unemployment benefits declined last week to 372,000, while the four-week moving average fell 3,250 last week to 376,500 — the lowest since June 2008. On Friday, the Labor Department will issue its monthly employment report, but today ADP (NASDAQ:ADP) released its monthly report on private-sector employment, which estimates that the U.S. economy added some 325,000 private-sector jobs in December.

3) Auto. Strong auto sales helped support stocks throughout the day, with Detroit’s big three automakers — General Motors (NYSE:GM), Ford (NYSE:F), and Chrysler — on track to be profitable in 2011 when they report earnings in the coming weeks, something they haven’t achieved since 2004. And industry analysts forecasting even better industrywide sales in 2012.

BONUS: Obama Outlines New Defense Strategy Amid Pentagon Spending Cuts

After Hours Radar Stocks

Shares of Alcoa Inc. (NYSE:AA) are trading 1.40 percent lower after the closing bell.  The company said it will reduce its global smelting capacity by 12 percent, due to the large decline in aluminum prices.

Investing Insights: Aloca Kicks Off 2012 Earnings Season with These Expectations.

Family Dollar Stores Inc. (NYSE:FDO) shares are down 2.48 percent in late trading.  The company reported fiscal first quarter profits of $80.4 million, or 68 cents per share.  Shares of Dollar General Corp. (NYSE:DG) and Dollar Tree Inc.(NASDAQ:DLTR) are also trading lower.

Johnson & Johnson (NYSE:JNJ) continue to edge lower in extended trading hours. The consumer healthcare company will pay more than $1 billion to the U.S. and most states to resolve a civil investigation regarding marketing practices of its anti-psychotic Risperdal drug.

Don’t Miss: Kraft Leverages Soda.

After closing the day down almost 1 percent, Yahoo! Inc. (NASDAQ:YHOO) shares continue to decline in late trading.  Bloomberg reports, “The Weather Channel and WebMD Health Corp. (NASDAQ:WBMD) are among companies Yahoo is interested in owning as part of a tax-efficient asset swap with Alibaba Group Holding Ltd. and Softbank Corp., said three people with knowledge of the matter.”  WBMD shares are trading higher on the news.

Shares of RF Micro Devices Inc. (NASDAQ:RFMD) are plummeting almost 13 percent after the company provided a Q3 update. CEO Bob Bruggeworth said, “RFMD is navigating broadly lower demand in 2G handsets and softness across MPG’s markets. Despite this challenging macro environment, RFMD is winning new business with industry-leading products and technologies, and we fully expect to grow in fiscal 2013, supported by market share gains, new product launches, and expanding relationships with both channel partners and customers.”

Investing Insights: These 5 CEOs Made Bank on Rising Share Prices in 2011.

To contact the reporter on this story: Stella Mariz at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com

More from The Cheat Sheet