Ultimate Market Recap: ECB President Sits on His Hands, H&R Block Increases Dividend

Thursday Morning’s Top Stories

As expected, the European Central Bank cut its key lending rate from 1.25 percent to 1 percent. ECB president Mario Draghi will hold a news conference and may state additional measures to help the euro zone’s debt crisis.

Today’s cut represents the second one in months under Draghi’s leadership and it has the refinance rate hitting a record low after rate hikes had been previously implemented this year.

Don’t Miss: ECB Cuts Interest Rates Ahead of EU Summit.

Jon Corzine, the ex-chief of MF Global (MFGLQ.PK), has apologized to customers in a statement and added that he doesn’t know where the firm’s missing money is located. A trustee for the bankrupt firm has estimated the amount at $1.2 billion. Corzine will appear in front of the House of Representatives Ag Committee today and added, “I simply do not know where the money is, or why the accounts have not been reconciled.”

According to MarketWatch, Corizine expressed sadness over the firm’s failing and said there were “an extraordinary number of transactions” during the firm’s final days and there had been “operational errors.” Regulators are reviewing whether a few days priors to MF Global’s fall, customer funds had been used to make proprietary trades.

Investing Insights: Jon Corzine: I Don’t Know What Happened to MF Global Missing Funds.

Costco Wholesale Corp (NASDAQ:COST) reported its fiscal quarter one earnings rose to $320 million (0.73 cents per share) as compared to the previous year’s $312 million (0.71 centers per share). Net sales increased 13 percent to $21.18 billion with membership fee revenue rising 7.5 percent to $447 million in the quarter.

Costco has a month left under CEO Jim Sinegal’s leadership before he’s replaced in January by COO Craig Jelinek.

Alibaba Group is trying to put together $4 billion in debt financing to buy back a 40 percent stake in the company owned by Yahoo Inc. (NASDAQ:YHOO). Because Alibaba Group is a private company, the Yahoo stake has been estimated at least $9 billion.

According to Reuters, sources have said term sheets have been sent to banks for debt financing underwriting proposals with a possible three-year term.

Don’t Miss: Will Gold Help Japan Sell Debt?

Thursday Morning Hot Stocks

International Business Machine (NYSE:IBM) is heading lower early Thursday.  The company announced it is buying cloud firm DemandTec (NASDAQ:DMAN) for $440 million, or $13.20 per share.

Don’t Miss: Cloud Computing: Your Cheat Sheet to the Cloud Business Landscape.

McDonald’s Corp (NYSE:MCD) shares gained .70% after reporting that global sales for restaurants open at least one year increased 7.4% in November, compared to last year.  Competitors include: Yum! Brands, Inc. (NYSE:YUM) and Chipotle Mexican Grill, Inc. (NYSE:CMG).

Ciena Corp (NASDAQ:CIEN) jumped more than 7% this morning.  The company reported a fourth quarter loss of $22.3 million (23 cents per share), compared with $80.3 million (86 cents per share) last year.

Investing Insights: CIENA Corp Earnings Cheat Sheet: Loss Narrows and Tops Forecasts.

Shares of Costco Wholesale Corp (NASDAQ:COST) traded down nearly 3% after reporting first quarter results. Net income for the discount store increased 2.6% to $320 million (73 cents per share), compared to $312 million (71 cents per share) in the same quarter a year earlier.

Smithfield Foods Inc. (NYSE:SFD) is trading almost 2% lower after reporting a 16% decline from the year earlier quarter.  Net income for the company decreased to $120.7 million (74 cents per share), compared to $143.7 million (86 cents per share) a year earlier.

Don’t Miss: Costco Earnings Cheat Sheet: Revenue Grows By Double-Digits For Fifth Straight Quarter.

Thursday’s Trending Stocks

The Dow Jones Industrial Average is now trading at 12,128 and the S&P 500 is trading at 1,250. Here are he hottest stocks buzzing among traders and investors on Wall Street today:

  1. DemandTec, Inc. (NASDAQ:DMAN): Shares of DemandTec, Inc. are trading higher 55% today. DemandTec, Inc. provides consumer demand management (CDM) software. The Company’s software captures and analyzes recent retailer and market-level data to provide a scientific understanding of consumer behavior.
  2. Ciena Corporation (NASDAQ:CIEN): Shares of Ciena Corporation are trading higher 4.7% today. Ciena Corporation develops and markets communications network platforms and software, and offers professional services. The Company’s broadband access, data and optical networking platforms, software tools, and global network services support worldwide telecom and cable/MSO services providers, and enterprise and government networks.
  3. Pacific Sunwear of California, Inc. (NASDAQ:PSUN): Shares of Pacific Sunwear of California, Inc. are trading higher 28% today. Pacific Sunwear of California, Inc. operates a nationwide mall-based specialty retail chain of stores. The Company specializes in casual apparel, footwear, and related accessories catering to teenagers and young adults.
  4. G-III Apparel Group, Ltd. (NASDAQ:GIII): Shares of G-III Apparel Group, Ltd. are trading higher 15% today. G-III Apparel Group, Ltd. manufactures and distributes leather and non-leather outerwear apparel. The Company has fashion licenses with Kenneth Cole, Jones Apparel Group, Cole Haan, and Timberland. GIII own labels GIII, Siena Studio, Colebrook & Co, JLC, JL Colebrook, and ColeB. G-III also has licensing agreements with the NFL, NHL, NBA, and MLB.
  5. Costco Wholesale Corporation (NASDAQ:COST): Shares of Costco Wholesale Corporation are trading lower 1.78% today. Costco Wholesale Corporation operates wholesale membership warehouses in multiple countries. The Company sells all kinds of food, automotive supplies, toys, hardware, sporting goods, jewelry, electronics, apparel, health and beauty aids, as well as other goods.
  6. Smithfield Foods, Inc. (NYSE:SFD): Shares of Smithfield Foods, Inc. are trading lower3% today. Smithfield Foods, Inc. processes pork and produces hogs through its meat processing and hog production groups. The Company also produces and markets a range of branded food products such as frozen barbecues and chilies, peanuts, and pork products. Smithfield’s products are sold on a wholesale basis, through catalogs, through its retail stores, and via the Internet.
  7. Affymax, Inc. (NASDAQ:AFFY): Shares of Affymax, Inc. are trading higher 35% today. Affymax Inc. is a clinical-stage biopharmaceutical company. The Company develops peptide-based drugs for the treatment of serious and life-threatening conditions such as kidney disease and cancer.
  8. Martha Stewart Living Omnimedia, Inc. (NYSE:MSO): Shares of Martha Stewart Living Omnimedia, Inc. are trading higher 1.9% today. Martha Stewart Living Omnimedia, Inc. creates original how-to content and related products for homemakers and other consumers. The Company markets its brand name across a broad range of media and retail outlets. Martha Stewart provides information on a variety of subjects including home, cooking and entertaining, gardening, crafts, holidays, household maintenance, and weddings.
  9. Alexza Pharmaceuticals, Inc. (NASDAQ:ALXA): Shares of Alexza Pharmaceuticals, Inc. are trading lower 34% today. Alexza Pharmaceuticals, Inc. is a pharmaceutical company focused on the development and commercialization of proprietary products for the treatment of acute and intermittent conditions.
  10. Antares Pharma Inc (NYSEAMEX:AIS): Shares of Antares Pharma Inc are trading lower 6% today. Antares Pharma, Inc. develops pharmaceutical delivery systems, including needle-free and mini-needle injector systems and transdermal gel technologies. The Company distributes its needle-free injector systems in various countries. Antares also conducts research and development with transdermal gel products and has several products in clinical evaluation with partners.

Market Recap

Markets closed down on Wall Street today: Dow -1.63%, S&P -2.11%, Nasdaq -1.99%, Oil -2.48%, Gold -1.86%.

On the commodities front, Oil (NYSE:USO) fell to $98.00 a barrel. Precious metals were also down, with Gold (NYSE:GLD) falling to $1,712.40 an ounce while Silver (NYSE:SLV) fell 2.93% to settle at $31.67.

Hot Feature: Precious Metals Decline After Mario Draghi Disappoints

Today’s markets were down because:

1) ECB. Though ensuring European banks would have unlimited access to cheap cash with new three-year loans, European Central Bank President Mario Draghi frightened investors when he refused to commit to broad assistance to troubled euro countries. The news should have come as no surprise, given that Draghi has continually emphasized the importance of sovereign governments taking their steps to restore confidence and tackle the debt crisis, but many were still hoping the ECB would expand its bond-purchasing program.

2) Jobless. The number of people filing for initial unemployment benefits fell to a 9-month low of 381,000 last week. The news initially boosted markets, but as has been the case for months now, Europe’s news soon overshadowed positive economic data in the U.S., where wholesale inventories for the month of October also did better than expected, according to a report today, coming in at 1.6 percent instead of the projected 0.2 percent increase.

3) Banks. Financials were unsurprisingly the hardest hit by the ECB’s news, with all major U.S. banks declining. Wells Fargo (NYSE:WFC), Goldman Sachs (NYSE:GS), Bank of America (NYSE:BAC), and JPMorgan (NYSE:JPM) were all down 3 to 5 percent today, while Citigroup (NYSE:C) and Morgan Stanley (NYSE:MS) did even worse, closing the day down 6.97 percent and 8.42 percent, respectively.

BONUS: Congress Debates Payroll Tax Cut Extension.

After Hours Radar Stocks

After closing the day 2.98% lower, shares of Ford (NYSE:F) continue to edge .37% lower in late trading.  The auto company announced it will resume paying a dividend.  It will be five cents per share, and is the first dividend paid by the company in five years.  Competitors include: General Motors (NYSE:GM), Toyota Motor Corp. (NYSE:TM) and Honda Motor Co. (NYSE:HMC).

Shares of Texas Instruments Inc. (NYSE:TXN) are down more than 6% after the closing bell.  The company lowered its expected ranges for revenue and earnings per share.  Texas Instruments now expects revenue between $3.19-$3.33 billion, compared to previous estimates of $3.26-$3.54 billion.  Earnings per share is expected to be $0.21-$0.25, compared to the prior range of $0.28-$0.36.

Investing Insights: Best Buy Co. Inc. Third Quarter Earnings Sneak Peek.

Exxon Mobil Corp. (NYSE:XOM) is edging slightly higher after announcing that is believes US oil imports have peaked, and will decline in the next three decades.  The oil giant cits rising domestic supplies and a 20% reduction in oil demand as the causes. Competitors include: Chevron Corp. (NYSE:CVX) and ConocoPhillips (NYSE:COP).

Late Thursday, H&R Block Inc. (NYSE:HRB) announced it will increase its annual cash dividend by 33%. “This dividend increase is a direct reflection of the company’s continued commitment to strong shareholder returns,” said President and Chief Executive Bill Cobb. “It’s a bold move that shows we are confident in our ability to grow clients and market share, and confident in our future.”

Shares of Altera Corp. (NASDAQ:ALTR) are down almost 5% after saying revenue for the fourth quarter will come in 13%-16% lower than the third quarter.  “As the quarter has progressed, economic uncertainty, macroeconomic concerns, and, in some instances, lower than planned sales have resulted in customers reducing demand on Altera,” the company explained in a statement.

Don’t Miss: These 30 Firms Have the Best Accountants or Lobbyists Money Can Buy.

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