Ultimate Market Recap: Merkel and Sarkozy Have a Power Lunch, Angie’s List Up 8%

Monday Morning’s Top Stories

The final euro zone composite PMI numbers have come out and the 17 nation region saw its November private  sector activity again decline but at a smaller pace than October’s numbers, according to Markit. November’s composite PMI increased to 47.0 compared to October’s 46.5; however, it was lower from its earlier 47.2 reading. A contraction is reflected in a number lower than 50.

November numbers also showed contraction in France (NYSEARCA:EWQ), Germany (NYSEARCA:EWG), Italy (NYSE:EWI) and Spain (NYSE:EWP), representing a third straight month of euro zone contraction. A 0.6 percent contraction for the fourth quarter has been forecast.

Investing Insights: 15 Stocks and Companies Facing Sell Offs If Europe Collapses.

Market watchers are anxiously awaiting to hear about today’s lunch meeting between French President Nicolas Sarkozy and German Chancellor Angela Merkel. Hopes are rising on whether the two can set aside their fiscal differences and come up with a plan as they look toward Friday’s EU summit. Merkel is asking for more power to monitor the budgets of “sinner states” but she hasn’t offered any concrete plans, according to The Telegraph.

Don’t Miss: Italy’s Monti Unveils Radical Austerity Measures in Emergency Decree.

Regulators have discovered MF Global (NYSE:MF) pooled customer securities and futures account monies and then transferred it outside the country to at least one party, according to Reuters. The combining and transferring of money has been difficult to unravel as  investigators initially thought only futures accounts had been involved. In addition,  they have also learned that MF utilized customer funds for “several days if not weeks” opposed to only a few days prior to the firm’s implosion.

Commercial Metals Co. (NYSE:CMC) has rejected Carl Ichan’s unsolicited $1.73 billion bid on the belief it does not show the company’s true valuation. In a statement by CMC CEO Joe Alvarado, he said the bid “is an opportunistic attempt, at a time when we are at a low point in the economic and industry cycle, to transfer the future value of CMC from its stockholders to Carl Icahn.”

Icahn Enterprises LP (NYSE:IEP) currently has a 10 percent ownership in CMC and with its Nov. 28 $15 per share offer for the company’s remaining shares, it reflected a 31 percent increase from the the stock’s close on Nov. 25.

Investing Insights: The Week Ahead on Wall Street: Geithner Goes to Europe, Toll Brothers Earnings.

Monday Morning Hot Stocks

Shares of major US banks climbed higher early Monday as Timothy Geithner heads to Europe.  Speculation is fueling more bailout rumors. Bank of America (NYSE:BAC) jumped more than 3%, Citigroup Inc. (NYSE:C) gained 2.7%, and JP Morgan (NYSE:JPM) increased 2.8%.

Don’t Miss: Major Banks Back in the Spotlight.

Dollar General (NYSE:DG) popped nearly 2% after reporting a 34% rise in third-quarter earnings.  Net income for Dollar General Corporation rose to $171 million (50 cents per share), compared to $128.1 million (37 cents per share) in the same quarter a year earlier. Keep an eye on the dollar retailers: Family Dollar Stores, Inc. (NYSE:FDO), Dollar Tree, Inc. (NASDAQ:DLTR), 99 Cents Only Stores (NYSE:NDN), and Big Lots, Inc. (NYSE:BIG).

Investing Insights: Dollar General Corp Earnings Cheat Sheet: Powering Ahead.

Walgreen Co (NYSE:WAG) is edging .54% higher this morning after reporting that comparable-store sales increased 1.8% for November. The drugstore chain will also be phasing out its rewards program in January.  Shares of CVS Caremark (NYSE:CVS) are up nearly 1%.

MetLife Inc. (NYSE:MET) is jumping more than 3% at the opening bell.  The company said on Monday that it expects fourth quarter operating income to be in the $1.2 billion to $1.3 billion range, compared to $1.2 billion last year.  Competitors to watch on the news include American International Group (NYSE:AIG) and Prudential Financial, Inc. (NYSE:PRU).

Shares of Goldcorp Inc. (NYSE:GG) are edging slightly higher at the open.  The gold miner announced it will boost its annual dividend by 32% to 54 cents per share.

Don’t Miss: Why is Gold Finding Support At This Level?

Monday’s Trending Stocks

The Dow Jones Industrial Average is surging higher 138 points to 12,158 and the S&P 500 Index is higher 1.5% to 1,263. Here are the most buzzing stocks among traders and investors today:

  1. Affymax, Inc. (NASDAQ:AFFY): Shares of Affymax, Inc. are trading higher 21% 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.
  2. SuccessFactors, Inc. (NYSE:SFSF): Shares of SuccessFactors, Inc. are trading higher 51% today. SuccessFactors, Inc. provides on-demand performance and employee software solutions to help organizations optimize their performance.
  3. Dollar General Corp. (NYSE:DG): Shares of Dollar General Corp. are trading higher 1.5% today. Dollar General Corp. operates a chain of discount retail stores located primarily in the southern, southwestern, midwestern and eastern United States. The Company offer a broad selection of merchandise, including consumable products such as food, paper and cleaning products, health and beauty products and pet supplies, and non-consumable products such as seasonal merchandise.
  4. Taleo Corporation (NASDAQ:TLEO): Shares of Taleo Corporation are trading higher 19% today. Taleo Corporation is a provider of enterprise staffing management solutions that enable large organizations to establish, automate and manage worldwide staffing processes for professional, hourly and temporary staff.
  5. Entergy Corporation (NYSE:ETR): Shares of Entergy Corporation are trading higher 4% today. Entergy Corporation is an integrated energy company that is primarily focused on electric power production and retail electric distribution operations. The Company delivers electricity to utility customers in Arkansas, Louisiana, Mississippi, and Texas. Entergy also owns and operates nuclear plants in the northern United States
  6. ITC Holdings Corp. (NYSE:ITC): Shares of ITC Holdings Corp. are trading higher 3.9% today. ITC Holdings Corporation is a holding company. Through subsidiaries, the Company transmits electricity from electricity generating stations to local electricity distribution facilities. ITC invests in electricity transmission infrastructure improvements as a means to improve electricity reliability and reduce congestion.
  7. SAP AG (NYSE:SAP): Shares of SAP AG are trading flat today. SAP AG is a multinational software company. The Company develops business software, including e-business and enterprise management software, consults on organizational usage of its applications software, and provides training services. SAP markets its products and services worldwide.
  8. Hi-Tech Pharmacal Co. (NASDAQ:HITK): Shares of Hi-Tech Pharmacal Co. are trading lower 4% today. Hi-Tech Pharmacal Co., Inc. manufactures prescription and over-the-counter generic and branded pharmaceuticals in liquid and semi-solid dosage forms. The Company also manufactures sterile ophthalmic, otic, and inhalation products and provides sterile manufacturing contract services. Hi-Tech markets its own products under names such as H-T, Rx Choice, DiabetiDerm, and Steri-Optics.
  9. TearLab Corporation (NASDAQ:TEAR): Shares of TearLab Corporation are trading higher 29% today. TearLab Corp. is an in-vitro diagnostics company. The Company develops and commercializes lab-on-a-chip technologies that enable eye care practitioners to test for sensitive and specific biomarkers in tears at the point-of-care.
  10. Piedmont Natural Gas Company Inc. (NYSE:PNY): Shares of Piedmont Natural Gas Company Inc. are trading higher 2.38%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.

Market Recap

Markets closed up on Wall Street today: Dow +0.65%, S&P+1.03%, Nasdaq +1.10%, Oil -0.01%, Gold -1.52%.

On the commodities front, Oil (NYSE:USO) fell to $100.95 a barrel. Precious metals were also down, with Gold (NYSE:GLD) falling to $1,724.70 an ounce while Silver (NYSE:SLV) fell 2.08% to settle at $32.01.

Hot Feature: Italy’s Monti Unveils Radical Austerity Measures in Emergency Decree

Today’s markets were up because:

1) France and Germany. Leaders of the euro zone’s two largest economies hammered out a joint proposal today for a more economically unified Europe days ahead of a crucial summit. German Chancellor Angela Merkel and French President Nicolas Sarkozy will propose a new treaty that demands closer economic integration and tougher policing of fiscal rules when they meet with other European Union leaders at a summit in Brussels on Friday. Speaking after the meeting, Sarkozy said the “Franco-German agreement is very complete” and will be “written up in a letter and presented to [European Council President] Herman Van Rompuy on Wednesday.”

2) Standard & Poor’s. The indexes were all up around 1.5% earlier in the day on news that Merkel and Sarkozy had come to a quick and decisive agreement on creating a tighter fiscal union, but pulled back in the mid-afternoon after a Financial Times report suggested that Standard & Poor’s will put Germany, France, the Netherlands, Austria, Finland and Luxembourg — all of the euro zone’s AAA-rated members — on “creditwatch negative” later Monday. That would mean the countries have a 50% chance of being downgraded within the next 90 days.

3) Banks. Bank stocks were leading the broad advance this morning, and remained the market’s best performers through close. JPMorgan (NYSE:JPM) and Bank of America (NYSE:BAC) posted the Dow’s biggest gains, while shares of Citigroup (NYSE:C), Morgan Stanley (NYSE:MS), and Goldman Sachs (NYSE:GS) all tacked on from 2 to 7 percent by closing bell.

BONUS: Oil Prices Move Higher as Tensions With Iran Mount

After Hours Radar Stocks

Shares of Pep Boys (NYSE:PBY) are edging down .51% after reporting third quarter earnings.  Net income for Pep Boys Manny Moe & Jack increased 22.6% to $7 million (13 cents per share), compared to $5.7 million (11 cents per share) in the same quarter a year earlier.  Competitors include: Advance Auto Parts, Inc. (NYSE:AAP), O’Reilly Automotive, Inc. (NASDAQ:ORLY) and AutoZone (NYSE:AZO).

Investing Insights: Pep Boys Earnings Cheat Sheet: Profit Increases Again.

Angie’s List (NASDAQ:ANGI) is surging more than 8% after the closing bell.  Internet related IPOs continue to receive attention as Zynga prepares to go public.  Shares of Pandora (NYSE:P) are also up about 2% in late trading.

After closing 2.5% higher Monday, shares of homebuilder Toll Brothers Inc. (NYSE:TOL) continues to head 1% higher in extended trading.  Homebuilders across the board received a lift after a Barclays Capital analyst said he sees elements for a US housing market recovery next year.

Clearwire (NASDAQ:CLWR) shares dropped more than 6% after announcing plans to issue $300 million in Class A shares.  The share offering will help fund its 4G network project.  Sprint (NYSE:S) will exercise its preemptive rights related to the offering by purchasing Class B shares.  Verizon (NYSE:VZ) and AT&T (NYSE:T) both edged higher on the news.

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