Some clarity from Europe amid a slew of rumours.First, the scoreboard:
Dow: +37.2 pts, +0.3%
S&P 500: +5.5 pts, +0.5%
NASDAQ: -5.4 pts, -0.2%
And now, the top stories:
- A lot of news coming out of Europe today. Regarding Greece, the Troika (i.e. EU, ECB, and IMF), stressed the immediate release of the next tranche of bailout funds to Greece as soon as possible. Also, amid riots, the Greek Parliament approved a round of austerity measures.
- The European rumour mill was cranking this morning. First was a report that EU leaders would postpone their highly anticipated summit. Then another rumour surfaced that a deal to lever up the EFSF wouldn’t happen this weekend. Markets didn’t like either.
- However, markets staged a big comeback thanks to some actual confirmed news. EU leaders said they would hold a second summit next Wednesday, when they would agree on a “comprehensive and ambitious” solution to the eurozone debt crisis.
- In other news, we got some economic data today. Initial jobless claims came in higher-than-expected at 403k. Economists were expecting 400k. Though the miss wasn’t by too wide a margin, it wasn’t great news either. However, it’s worth noting that the 4-week moving average is at its lowest level since the spring.
- At 10:00 am, we got two pieces of economic data. September existing homes declined 3% from last month to an annual rate of 4.91 million. This was right in line with expectations.
- We also got the Philly Fed survey, which blew out expectations. The number came in at +8.7. Analysts were expecting -9.4. More proof that the economy is still growing.
- There was also notable moves on earnings announcements. Computer hardware maker Western Digital announced disappointing guidance. Business is being disrupted by the devastating floods in Thailand. But traders apparently expected worse. The stock, which had been beaten up since the floods, jumped 6.2%. However, Dell got punished today, falling 5.4%, after everyone suddenly remembered that Western Digital’s hardware went into Dell computers.
- Among the notable movers today was Wynn resorts, which fell 5.3% on disappointing earnings. But for those who were listening, Steve Wynn offered some colourful commentary on Occupy Wall Street and federal deficits among other things.
- With all this uncertainty and weakness in the economy, it’s no surprise that cigarette sales are doing well. Phillip Morris, which operates as Altria Group, came out with better-than-expected earnings. They would’ve done even better, but they had a tough time competing with ‘illicit products’ in Pakistan. Shares closed down 0.3%.
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