Ultimate Market Recap: MF Global Bombs, Markets Dive Over 2%
Monday Morning’s Top Stories
Russia (NYSE:RSX) will provide up to $1o in billion to help European countries with the euro zone debt crisis. The country said last week they were willing to offer assistance but according to Arkady Dvorkovich, Russia’s chief presidential economic aide, he reiterated they will provide money through the International Monetary Fund instead of contributions to a special stability fund.
After attempting a fire sale over the weekend, MF Global (NYSE:MF), will file for Chapter 11 bankruptcy as soon as today and according to the Wall Steet Journal, may sell the firm’s assets to Interactive Brokers Group (NASDAQ:IBKR) for $1 billion through a court-supervised auction. The company has also been suspended from conducting business with the Federal Reserve Bank of New York.
Panasonic Corp. (NYSE:PC) reported a second quarter net loss of Y$105.8 billion as compared to a net profit of Y$31.0 billion from the previous year. Its operating profit for the quarter declined about 50 percent to Y$42.0 billion as compared to Y$85.2 billion from the same time period a year ago. The gloomy report also included a 6 percent revenue decline to Y$2.076 trillion from Y$2.207 trillion. For its full fiscal year through March, Panasonic dropped its earnings forecast and now estimates a Y$420 net loss, a Y$130 billion operating profit and Y$8.3 trillion in revenues.
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Netflix Inc. (NASDAQ:NFLX) and Amazon.com Inc. (NASDAQ:AMZN) have signed licensing deals with Walt Disney Co. (NYSE:DIS) to increase offerings to their subscribers. Netflix will ramp up its Disney, ABC series and TV movie lineup while Amazon’s deal will include the streaming of content from ABC Studios, Disney Channel, ABC Family and Marvel. Financial details were not disclosed by any of the companies.
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Monday Morning Hot Stocks
Jetblue Airways (NASDAQ:JBLU) is trading nearly 4% lower in early trading. The company had a rough weekend after a rare October snowstorm over the weekend stranded a number of flights at Connecticut’s Bradley International Airport. Passengers on at least three JetBlue planes say they were stranded on the tarmac for seven hours or more. Shares of Southwest Airlines (NYSE:LUV) and Delta Air Lines (NYSE:DAL) are also trading lower.
The pain continues for MF Global (NYSE:MF). Shares were halted on Monday after falling below 50 cents a share. Some believed that Goldman Sachs (NYSE:GS) would come to the firm’s rescue, but that does not appear to be the case. The broker-dealer is looking to sell off assets. The New York Fed also suspended operations with MF Global as a primary dealer.
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Barclays Capital (NYSE:BCS) is trading down 2% after releasing earnings. Revenue decreased 15% to GBP2.25 billion, compared to GBP2.65 billion last year. Chief Executive Bob Diamond said he is “absolutely committed” to earning a 13% return-on-equity target by 2013, despite the weak performance this quarter. Bank of America (NYSE:BAC) and Morgan Stanley (NYSE:MS) are also trading lower this morning.
Netflix Inc. (NASDAQ:NFLX) and Amazon.com Inc. (NASDAQ:AMZN) have signed licensing deals with Walt Disney Co. (NYSE:DIS) to increase offerings to their subscribers. Netflix will ramp up its Disney, ABC series and TV movie lineup while Amazon’s deal will include the streaming of content from ABC Studios, Disney Channel, ABC Family and Marvel. Financial details were not disclosed by any of the companies. Shares of all three companies are trading more than 1% lower.
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Shares of Humana Inc (NYSE:HUM) are jumping 2.6% in early trading. Third quarter net income increased 13%. The company also raised guidance for the current quarter to $8.35-$8.40, compared to previous estimates of $7.50-$7.60.
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Monday Afternoon’s Trending Stocks
As the Dow Jones Industrial Average has dropped over 150 points and the S&P 500 is down over 1% today, here are the hottest stocks on our radar for you to watch:
- The Shaw Group Inc. (NYSE:SHAW): Shares of The Shaw Group Inc. are trading higher today. The company’s delivered a double-digit decline in revenue in its latest quarterly report. The Shaw Group Inc. provides engineering, procurement, construction, maintenance, fabrication, manufacturing, consulting, remediation, and facilities management services for government and private sector clients in the power, process, environmental, infrastructure, and emergency response markets.
- Humana Inc. (NYSE:HUM): Shares of Humana Inc. are trading higher today after issuing an 11% revenue increase in quarterly growth. Humana Inc. is a managed health care company with medical members located in the United States and Puerto Rico. The Company offers coordinated health care through health maintenance organizations, preferred provider organizations, point-of-service plans, and administrative services products. Humana offers its products to employer groups, government-sponsored plans, and individuals.
- Pacira Pharmaceuticals Inc (NASDAQ:PCRX): Shares of Pacira Pharmaceuticals Inc are trading higher today after pleasing shareholders with its latest quarterly earnings release.
- NPS Pharmaceuticals, Inc. (NASDAQ:NPSP): Shares of NPS Pharmaceuticals, Inc. are trading lower today after released mixed Phase III clinical data for its gastrointestinal treatment Gattex which treats short bowel syndrome. NPS Pharmaceuticals, Inc. is a biopharmaceutical company focused on the development of treatment options for patients with rare gastrointestinal and endocrine disorders and serious unmet medical needs.
- HONDA MOTOR CO., LTD. (NYSE:HMC): Shares of HONDA MOTOR CO., LTD. are trading lower today after announcing the cut of its supply chain today. HONDA MOTOR CO., LTD. develops, manufactures, and distributes motorcycles, automobiles, and power products such as generators and farm machinery. The Company also operates a financial credit business. Honda Motor has manufacturing facilities in the US, Canada, the UK, France, Italy, Spain, Brazil, Mexico, India, and Thailand.
- Changyou.com Limited (NASDAQ:CYOU): Shares of Changyou.com Limited are trading lower today. The company delivered a strong double-digit growth quarter, but it wasn’t enough to cause investors to buy the stock today. Shares are down over 14%. Buying opportunity anyone? Changyou.com Ltd. develops online computer games. The Company licenses its massively multi-player online role playing games.
- Loews Corporation (NYSE:L): Shares of Loews Corporation are trading lower todayafter missing analyst forecasts today on their latest quarterly earnings report. Loews Corporation is a diversified holding company. The Company, through its subsidiaries, is involved in a variety of businesses including commercial property-casualty insurance, offshore drilling, natural gas exploration and production, operation of natural gas pipeline systems, and the operation of hotels and resorts.
- Haemonetics Corporation (NYSE:HAE): Shares of Haemonetics Corporation are trading lower today after the company missed their earnings estimates today in their latest quarterly report. Haemonetics Corporation designs, manufactures, and markets automated blood processing systems. The Company’s products are for use in surgical blood salvage, blood component collections, and plasma collections. Haemonetics markets its products worldwide, primarily outside the United States.
- Cooper Tire & Rubber Company (NYSE:CTB): Shares of Cooper Tire & Rubber Company are trading higher today after reporting a quarterly earnings release that caused investors to buy shares. Cooper Tire & Rubber Company manufactures and markets replacement tires. The Company focuses on the manufacture and sale of passenger and light truck replacement tires. Cooper also manufactures radial medium truck tires and materials and equipment for the truck tire retread industry.
- Interactive Brokers Group, Inc. (NASDAQ:IBKR): Shares of Interactive Brokers Group, Inc. are trading higher today after MF Global files for bankruptcy. One broker loses and another broker gains. Interactive Brokers Group, Inc. is an automated global electronic market maker and broker specializing in routing orders and executing and processing trades in securities, futures, and foreign exchange instruments.
Markets closed down on Wall Street today: Dow -2.25%, S&P -2.47%, Nasdaq -1.93%, Oil -0.79%, Gold -1.51%.
On the commodities front, Oil (NYSE:USO) fell to $92.58 a barrel. Precious metals also declined, with Gold (NYSE:GLD) down to $1,720.90 an ounce while Silver (NYSE:SLV) fell 2.56% to settle at $34.39.
Today’s markets were down because:
1) Europe. Italian and Spanish bond yields soared, prompting the European Central Bank to buy the debt. Meanwhile, though European leaders agreed last week to increase the European Financial Stability Facility rescue fund to 1 trillion euros, they’re now facing difficulties finding outside contributors. At the same time, MF Global Holdings Ltd. (NYSE:MF), the futures broker that made big bets on European sovereign debt, filed for U.S. Chapter 11 bankruptcy protection today after talks to sell its assets fell through. While the worst-case scenario for Europe seems off the table, at least for now, they still have a long way to go to shore up the region’s finances.
2) Currency. The Japanese government stepped in early Monday to push down the yen’s value in international currency markets. The move immediately sent the dollar rising against major global currencies on safe-haven demand, putting pressure on commodities priced in dollars, such as oil and gold. The dollar climbed 2.9% against the yen.
3) Banks. JPMorgan (NYSE:JPM), which, according to an MF Global court filing, has about $1.2 billion worth of claims on the brokerage, fell 5.26% to $34.76, leading banking stocks lower. Goldman Sachs (NYSE:GS), Citigroup (NYSE:C), Morgan Stanley (NYSE:MS), Bank of America (NYSE:BAC), UBS (NYSE:UBS), and Wells Fargo (NYSE:WFC) were among the worst-performing stocks today.
After Hours Radar Stocks
Shares of Leap Wireless International (NASDAQ:LEAP) are jumping more than 9% in late market trading. The company reported a third quarter loss of $68.8 (90 cents per share), compared to a loss of $533.3 million ($7.06 per share) last year.
Allstate Corporation (NYSE:ALL) is trading 3.5% higher after the closing bell. The company reported third quarter results that beat the mean estimates. Net income for the property and casualty insurance company fell to $165 million (32 cents per share), compared to $367 million (68 cents per share) a year earlier. This is a decline of 55% from the year earlier quarter. The insurer competes with Aflac Inc (NYSE:AFL) and Progressive (NYSE:PGR).
SunTrust Banks (NYSE:STI) is attracting attention after learning from Bank of America’s (NYSE:BAC) mistake. The bank said on Monday that it will eliminate a monthly fee on check cards. All clients who incurred the fee, which was rolled out in June, would receive a refund. Shares closed more than 4% lower on Monday.
MGM Resorts International (NYSE:MGM) is edging .26% higher in extended trading. MGM and Boyd Gaming (NYSE:BYD) will partner with Bwin.Party to create a new entity in order to take advantage of online gambling, if it becomes legal in the US. Online gambling, except for betting on horse races in some states, is currently illegal in the US under the terms of the Unlawful Internet Gambling Enforcement Act of 2006. Las Vegas Sands (NYSE:LVS) is also ticking higher.