Ultimate Market Recap: Markets Rally Over 2%, Disney Leads Blue Chips Higher

Friday Morning’s Top Stories

Italy’s (NYSE:EWIsenate approved its 2012 budget bill with new austerity measures. It now goes to the house of parliament for final approval and then Italy’s chamber of deputies for a Saturday vote. This will pave the way to for Prime Minister Silvio Berlusconi’s resignation, which is likely to happen this weekend. His successor could be Mario Monti.

Chinese (NYSE:FXIbanks issued over 586 billion yuan ($2.78 billion) in new loans during October. This number exceeded expectations and may signal the government could implement an easing policy to support the economy. As compared to the previous year, October’s lending increased by CNY17.5 billion, according to the People’s Bank of China data.

Widespread flooding has brought disruptions and significant damage to more than a dozen hard disk drive factories. According to a new International Data Corporation (IDC) report, this will have a direct impact on worldwide PC shipments through 2012′s first half.

In 2011′s first half, Thailand (NYSE:THD) accounted for 40-45 percent of worldwide HDD production but now it’s almost half due to the floods. The industry will also likely face work stoppages from poor access and power outages. The floods’ total damage to HDD industry factories will be unknown until the flood waters retreat.

Employers are wary about hiring permanent staff  after feeling burned from the costs of laying off workers, according to a Reuters article. David Arkless, president of global corporate and government affairs at ManpowerGroup (NYSE:MPG) said on Thursday, “What has happened in this recession is that the psychology of hiring has completely changed.”

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In the past, firms hired temporary workers at the beginning of a recovery and slowly added more permanent staff as the economy improved. Not so today even within growing sectors in companies. Firms that had been hit with downsizing costs in the last few years are finding it easier to hire and fire temporary workers than going through permanent staff  layoffs.

Friday Morning Hot Stocks

Shares of Activision Blizzard Inc (NASDAQ:ATVI) edged higher in early trading after announcing that Call of Duty: Modern Warfare 3 set a new record with $400 million worth of sales in the first 24 hours.  Shares of Electronic Arts (NASDAQ:ERTS) also traded higher.

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D.R. Horton (NYSE:DHI) is falling 2% after reporting fourth quarter profits.  Reported a profit of $35.7 million (11 cents per diluted share) in the quarter. D. R. Horton Inc. had a net loss of $8.9 million or a loss 3 cents per share in the year earlier quarter.  The company fell short of estimates calling for 15 cents per share. Dig Deeper: D. R. Horton Inc. Earnings Cheat Sheet: Margins Shrink on Rising Costs.

Viacom Inc. (NYSE:VIA) is popping more than 3%.  The company announced on Friday that it will move its stock market listing to the Nasdaq Global Select Market from the New Yrok Stock Exchnage.

With oil (NYSEARCA:USO) closing in on $100 per barrel, shares of Exxon Mobil (NYSE:XOM) are climbing 1.3% higher.  The company has also signed agreements to explore for oil and gas in six blocks in the Kurdish region of Iraq.  Shares of Chevron (NYSE:CVX) are also trading 1.5% higher.

Despite increasing profits by 85%, shares of Dillard’s (NYSE:DDS) slip more than 5%.  The company reported profits of $26.6 million (50 cents per share) for the third quarter.  Gross margin, which measures the profitability of merchandise sold, was unchanged compared to a year earlier at 36.8% of sales in the quarter.  Shares of Macy’s (NYSE:M) and Saks Incorporated (NYSE:SKS) are also trading higher at the open.

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Friday’s Trending Stocks

As the Dow Jones Industrial Index ignites higher over 250 points to 12,163 and the S&P 500 Index is higher 2%, here’s a closer look at the most popular buzzing stocks on Wall Street today:

  1. The Walt Disney Company (NYSE:DIS): Shares of The Walt Disney Company are trading higher over 7.5% today. The Walt Disney Company, an entertainment company, conducts operations in media networks, studio entertainment, theme parks and resorts, consumer products, and Internet and direct marketing. The Company produces motion pictures, television programs, and musical recordings, as well as publishes books and magazines. Disney also operates ABC radio and television and theme parks.
  2. NVIDIA Corporation (NASDAQ:NVDA): Shares of NVIDIA Corporation are trading higher over 2% today. NVIDIA Corporation designs, develops, and markets three dimensional (3D) graphics processors and related software. The Company’s products provide interactive 3D graphics to the mainstream personal computer market.
  3. Pinnacle Data Systems, Inc. (AMEX:PNS): Shares of Pinnacle Data Systems, Inc. are trading higher 105% today. Pinnacle Data Systems, Inc. provides technology and service solutions to the telecommunications, medical systems, and manufacturing process control markets. The Company combines high-end engineering designs with commercially available hardware and software to meet original equipment manufacturer’s needs.
  4. Dillard’s, Inc. (NYSE:DDS): Shares of Dillard’s, Inc. are trading lower over 8% today. Dillard’s, Inc. operates retail department stores located primarily in the southwestern, southeastern, and midwestern United States. The Company offers name-brand and private-label merchandise, including fashion apparel and home furnishings.
  5. Netlist, Inc. (NASDAQ:NLST): Shares of Netlist, Inc. are trading higher 20% today. Netlist, Inc. develops and manufactures computer memory subsystems. The Company markets its products to original equipment manufacturers for use in servers and the high performance computing and communications markets.
  6. Western Gas Partners, LP (NYSE:WES): Shares of Western Gas Partners, LP are trading flat today. Western Gas Partners LP owns, operates, acquires, and develops midstream energy assets. With midstream assets in East Texas, the Rocky Mountains, the Mid-Continent and West Texas, the partnership is in the business of gathering, compressing, treating and transporting natural gas.
  7. Nordstrom, Inc. (NYSE:JWN): Shares of Nordstrom, Inc. are trading lower over 1.5% today. Nordstrom, Inc. is a fashion retailer of apparel, shoes, and accessories for men, women, and children. The Company operates through multiple retail channels, discount stores, boutiques, catalogs, and on the Internet. Nordstrom, Inc. also offers, through a subsidiary, private label card credit and debit cards.
  8. Tanzanian Royalty Exploration Corp. (AMEX:TRX): Shares of Tanzanian Royalty Exploration Corp. are trading higher 11% today.
  9. Piedmont Natural Gas Company Inc. (NYSE:PNY): Shares of Piedmont Natural Gas Company Inc. are trading higher over 1.5% today. Piedmont Natural Gas Company, Inc. is an energy and services company that primarily transports, distributes, and sells natural gas. The Company serves residential, commercial, and industrial customers in North Carolina, South Carolina, and Tennessee. Piedmont also, through subsidiaries, markets natural gas to customers in Georgia, and distributes propane in various states.
  10. Bank of America Corporation (NYSE:BAC): Shares of Bank of America Corporation are trading higher over 4% today. Bank of America Corporation accepts deposits and offers banking, investing, asset management, and other financial and risk-management products and services. The Company has a mortgage lending subsidiary, and an investment banking and securities brokerage subsidiary.

Market Recap

Markets closed up on Wall Street today: Dow +2.19%, S&P +1.95%, Nasdaq +2.04%, Oil +1.32%, Gold +1.69%.

On the commodities front, Oil (NYSE:USO) climbed to $99.07 a barrel. Precious metals were also up, with Gold (NYSE:GLD) climbing to $1,789.30 an ounce while Silver (NYSE:SLV) rose 1.61% to settle at $34.81.

Hot Feature: Spanish Economy Flatlined in Third Quarter.

Today’s markets were up because:

1) Italy. Italy’s Senate today approved debt-reduction measures intended to shore up investor confidence and pave the way for a new interim government that may be led by former European Union Competition Commissioner Mario Monti. The Chamber of Deputies will give final approval of the legislation tomorrow, after which Prime Minister Silvio Berlusconi will formally tender his resignation.

2) Greece. Greece swore in a new prime minister, Lucas Papademos, early Friday. Papademos, a former banker and European Central Bank vice president, will head the new national unity government tasked with pushing through austerity measures that will secure further bailout payments from the so-called troika, consisting of the European Union, European Central Bank, and International Monetary Fund. The controversial austerity measures will put Greece on track to get its next 8 billion-euro installment of aid, allowing it to pay its bills next month and avoid immediate default. 

3) Companies. Disney (NYSE:DIS) reported record earnings after closing bell on Thursday, posting a 21% gain in net income for the 2011 fiscal year. Shares of Nordstrom (NYSE:JWN) declined after the department store chain reported an increase in quarterly earnings after close on Thursday, though lowering their full-year outlook, while shares of Nvidia (NASDAQ:NVDA) rose after the chip maker posted a third-quarter profit after close yesterday that doubled from the year earlier period. 

BONUS: Consumer Sentiment Defies Scary EU Feelings.

After Hours Radar Stocks

Despite a large rally on Friday, shares of Apple (NASDAQ:AAPL) continue to lag behind.  Shares closed .16% lower, and continue to edge down in late trading.  On the positive, it only took the iPhone 4S three hours to sell out in Hong Kong.  Shares are down 3.9% over the past month.  Competitors include: Google (NASDAQ:GOOG), Amazon (NASDAQ:AMZN), and Microsoft (NASDAQ:MSFT).

After reporting strong earnings, Disney (NYSE:DIS) shares closed 5.95% higher.  After the closing bell, shares continue to edge .14% higher.  Net income for the entertainment company rose to $1.09 billion (58 cents per share), compared to $835 million (43 cents per share) in the same quarter a year earlier. This marks a rise of 30.2% from the year earlier quarter.  Competitors include: CBS (NYSE:CBS), Viacom (NYSE:VIA), and Time Warner (NYSE:TWX).

Investing Insights: The Walt Disney Company Earnings Cheat Sheet: Rising Revenue Helps Margins Expand, Profit Rises.

Shares of E*Trade (NASDAQ:ETFC) closed 4.11% lower after the brokerage cancelled its own sell order.  After exploring a number of strategic alternatives, E*Trade announced that it will remain independent.  On Thursday, E*Trade’s board of directors made the decision to withdraw from selling the company. It had been working with Goldman Sachs (NYSE:GS) as their financial adviser, and the bank had recommended they cease the selling process.  Shares are down .22% after the closing bell.

CME Group Inc. (NASDAQ:CME) climbed 1.33% higher on Friday after announcing it pledged $300 million to help speed up the release of customer cash and collateral that is trapped in the bankruptcy of MF Global.  “We recognize that the U.S. Bankruptcy Code requires the trustee to account for all customer assets and claims to ensure a fair, pro-rata distribution of those assets, and we sincerely appreciate how complex this task is for the Trustee,” said Craig Donohue, chief executive of CME, in a statement.

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