Tag - ESLR

Small-cap stocks went into yet another tailspin Tuesday, sinking to fresh bear market lows, unable to sustain morning enthusiasm tied to a positive outlook from a major PC-maker, instead focusing on the global recession, slumping homebuilder confidence and money flow into credit instruments. However, the market staged a brilliant late-session comeback bounce, repeating our recent pattern of seeing wild price swings in the final hour of trading. The Russell 2000 (NYSE:IWM) closed down 3.79, or 0.84%, at 447.51, which marked the lowest daily close since June 2003.

Small caps were hammered relative to large caps, with the Dow closing up 1.83% on the day. For the year, the Russell is now down 42%, while the Dow is down 36% and the S&P 500 is down 41%. Just a few weeks ago, the Russell was only down about 2% for the year while the Dow was down 12%; as the market has collapsed investors have clearly shied away from riskier investment fare as there is a perception in times of crisis that big is better.

Speaking of risk aversion, money appeared to moving into credit markets today, with the yield on benchmark 10-year notes down 2.94%. Yields move inverse to price, so the slide in yields reflects demand for the Treasury product. The decline in yields appeared to pick up speed after the National Association of Home Builders/Wells Fargo Housing Market Index stumbled to the lowest point since the index was created back in 1985. The NAHB report effectively cut off at the knees any enthusiasm from a jump in Southern California home sales, especially heading toward the housing starts report Wednesday morning. That separate report on sales in SoCal showed a big surge in volume, but it came at the expense of price as bargain hunters snatched up a large batch of foreclosed homes at a big discount. There are many who say that the genesis of this global crisis dates back to the housing market collapse and they believe that we won’t see a bottom in the market until we see a foundation built for housing prices.

There is also a pocket of market watchers who believe that equities will have a hard time establishing a bullish foothold it is known what steps will be taken to shore up embattled automakers. General Motors Corp. (NYSE:GM) tumbled some 9% today as Treasury Secretary Henry Paulson said on Capital Hill that the $700 billion financial bailout plan should not be applied to automakers. Even as Paulson and Federal Reserve Chairman Ben Bernanke were busy updating progress on the TARP, auto executives were busy telling the Senate Banking Committee that they need a massive bailout to avoid not just a collapse for domestic vehicle firms, but also the nation’s . . .

Small-cap stocks slipped 1.89% late Friday, as a bleak report on the housing sector, options expiration volatility and ongoing worries about the economy offset a spate of positive earnings in the tech arena. Today’s small-cap gainers are CIT Group (NYSE:CIT), Universal Stainless & Alloy Products (Nasdaq:USAP) and Ambac Financial Group (NYSE:ABK). Other Market Watch highlights today included:

• BMO Capital's Andy Busch to SCI: "There is a serious need to educate the banking sector participants on the changes in the Treasury programs the Fed programs directed at easing the credit crunch." 
• Outside of the gold market, commodity stocks were doing well today, with coal, steel, gas utilities, oil exploration, gas storage and agriculture products all up. 
• On the downside, anything tied to housing was struggling, including home furnishing stocks and homebuilder shares. Bank stocks and financial shares were also lagging the general market. 
• The expiration of options on stocks today likely played a role in some of the market’s struggles as the directional bias into expiration is clearly toward lower prices. 
• Crude oil jumped some $4 a barrel today as the market anticipates . . .

The Russell 2000 (NYSE:IWM) remained a smidge lower into the midday, but well off the morning lows as gains in the technology arena spilled over into the broad market. Concerns about the economy, a moribund housing market and expiration jitters kept a lid on some buying interest, but the market was trying to spark a rally heading toward the afternoon. Today’s small-cap gainers are UAL Corp. (Nasdaq:UAUA), CIT (NYSE:CIT) and Ambac Financial Group (NYSE:AKT). Other Market Watch highlights today include:

• Light, sweet crude for November delivery is up $1.66 to $71.51 a barrel. On Thursday, it sank to a 14-month low on worries about a deep global recession obliterating fuel demand.
• BMO Capital's Andy Busch to SCI: "There is a serious need to educate the banking sector participants on the changes in the Treasury programs the Fed programs directed at easing the credit crunch." 
• Outside of the gold market, commodity stocks were doing well today, with coal, steel, gas utilities, oil exploration, gas storage and agriculture products all up. 
• On the downside, anything tied to housing was struggling, including home furnishing stocks and homebuilder shares. Bank stocks and financial shares were also lagging the general market. 
• The expiration of options on stocks today likely played a role in some of the market’s struggles as the directional bias into expiration is clearly toward lower prices. 

Small Cap Gainers:

• CIT (NYSE:CIT) loss widens; vendor finance write-down hurts. Shares of the finance company are soaring 47%.
• United Air’s parent UAL Corp. (Nasdaq:UAUA) is up 20% today, extending its rise from Thursday.
• Ambac Financial Group (NYSE:AKT) is soaring nearly 30% on news . . .

Shares of Evergreen Solar Inc. (Nasdaq:ESLR) got a 9% boost this morning after RBC Capital Markets upgraded its stock to “sector perform” from “underperform.”

On Sept. 17, Citigroup also upgraded the stock to “hold” from “sell.”

Marlboro, Mass.-based Evergreen Solar, Inc. develops, manufactures, and markets solar power products primarily in Europe and the United States.

By mid-day, the stock is at $6.30, up $0.55 from Tuesday’s close. Shares have ranged between $3.30 and $18.85 during the past 52 weeks.

For detailed price information and news stories on Evergreen Solar, click ESLR.

Small caps opened lower on the session, as a disappointing existing home sales number created a cloud cover over famed investor Warren Buffett’s investment stake in now commercial bank Goldman Sachs (NYSE:GS).

At 10:22 a.m. ET the Russell 2000 (NYSE:IWM) was down 4.87, 0.69%, to 704.32.

The broader market applauded the Oracle of Omaha’s move, as it proved that there is confidence in the system and the decimated financial services sector. Buffett’s Berkshire Hathaway will invest $5 billion in Goldman Sachs by way of preferred stock. The deal could yield potential ownership of 10%.

“The stock market has been looking to see when Buffet would do a deal in the financial sector as a major sign that we're at the bottom,” Andy Busch, global foreign exchange strategist for BMO Capital Markets, said in an email. “Stocks have moved up on the news. …”

Meanwhile, Fed Chairman Bernanke and Treasury Secretary Henry Paulson will testify for a second day before the House on their $700 billion bailout plan. Day one of testimony on Tuesday was greeted coldly by the Senate with skepticism on both sides. Lawmakers grilled the administration’s economic officials. SEC Chairman Chris Cox called for regulation of credit default swaps (a security that acts like insurance on a loan or bond), which were responsible for pushing Lehman Brothers over the edge and forcing AIG into regulators’ hands. Democrats were keen on enacting limits on executive compensation and on allowing the government to take equity stakes in firms who take federal aid.

While the battle rages on, few perceive that a bailout solution would collapse all together. 

In economic news, existing home sales for August fell declined 2.2% to . . .

Small-cap stocks are expected to open solidly higher, buoyed by short-covering ahead of this afternoon’s FOMC policy announcement amid ideas the market is oversold on short-term indicators. The Russell 2000 (NYSE:IWM) was up 0.6% overnight, which suggests an opening near 711.50.

Durable goods orders for May came in unchanged, which was slightly softer than the median forecast for a rise of 0.1%. Equity index futures were able to hold sway with overnight gains despite the soft number. Durables have a history of being volatile, so it typically is going to take a bigger surprise than 0.1% to spark a meaningful move in the market.

Earlier this morning, the MBA mortgage application survey came in at minus 9.3%, which was the lowest level since July 2001. In addition, the report showed that the purchasing index fell 7.4% to the lowest point since February 2003. Also, the refinance index tumbled 12.1% to the lowest level since July 2001. With the housing market still soft and rates firming, mortgage activity has slowed to a crawl. Data on new home sales is slated for release later this morning at 10:00 a.m. ET.

The crude oil market was down ahead of the stock market open, waiting for today’s weekly inventory data. The market is anticipating a drawdown on crude oil stocks. The U.S. dollar was up marginally overnight, gaining about 0.2% against both the euro and the yen. The greenback will likely be influenced by this afternoon’s FOMC statement toward the inflation picture.

Equities markets overseas were primarily higher overnight, which should lend a little support to U.S. stocks this morning. Europe shares were lifted by comments from ECB President Jean-Claude Trichet that he did not envision a series of rate hikes. In Asia, China stocks were up 4.1%, while Hong Kong rose 0.8%, Taiwan 1.5%, . . .

Small-cap stocks are expected to open flat to slightly higher, underpinned by a mild dip in crude oil prices overnight and by scattered bargain hunting following Wednesday’s decline. The Russell 2000 (NYSE:IWM) was up about 0.2% overnight, which would suggest an opening near 732.

The weekly claims report headline number came in at 381,000, which was above the median forecast of 375,000. The four-week moving average on claims edged higher, which is a mild negative. Coming up at 10:00 a.m. ET, the market will see economic data on leading indicators and the Philly Fed survey, which could impact trading direction for the morning.

In overnight trading, Asia stock prices tumbled, with China down 7.2%, Japan off 2.2%, Hong Kong down 2.2%, Australia down 1.4%, Singapore down 1.5%, South Korea down 2% and India down 2.1%. Despite the plunge in Asian indices, European shares were slightly higher heading toward the U.S. opening.

Financial shares have been slumping this week as the credit crunch continues to spark efforts to raise capital to shore up balance sheets. Oppenheimer analyst Meredith Whitney lowered earnings projections for Morgan Stanley (NYSE:MS), which could keep investment banks and the financial arena on the defensive early . . .

The Russell 2000 (NYSE: IWM) and the Dow Jones Industrial Average (INDU) fell throughout Thursday’s trading session on weaker-than-expected durable goods orders and lackluster financial firm news, magnifying investors’ already present concerns surrounding a possible economic slowdown. The small-cap index dropped 23.52 points, or 2.95%, to 773.51. The Dow shed 192.08 points, or 1.42%, to 13,359.61.

News of the assassination of former Pakistani Prime Minister Benazir Bhutto only added to the unsettling economic data, shaking the markets.

Durable goods orders for the month of November edged up a less-than-forecasted 0.1% from October’s 0.4% decline. Economists were forecasting an increase of 2.5%.

In corporate news, Goldman Sachs issued a note late Wednesday speculating that financial juggernaut Citigroup Inc. (NYSE: C) might have to slash its dividend by 40% in light of now greater-than-forecasted write-downs for bad bets on collateralized debt obligations. Goldman is now projecting write-downs in the neighborhood of $18.7 billion, up from the investment bank’s previous estimate of $11 billion.

In related news surrounding the unfolding of the credit crisis, Fitch Ratings put 205 residential mortgage-backed securities backed by bond insurers, including MBIA and Ambac Financial Group, on review for a downgrade.

The day’s negative news overshadowed U.S. consumer confidence, which rose unexpectedly in December. The Conference Board's index of confidence increased to 88.6, the first gain in five months, from a revised 87.8 the prior month. November's number was the lowest in two years.

Shares of Marlboro, Mass.-based solar products maker Evergreen Solar
Inc. (Nasdaq: ESLR) are sagging following a downgrade this morning by Merriman Curhan Ford to “neutral” from “buy.”

The downgrade followed earnings news on Tuesday, in addition to announcements that the company plans to build a $150 million facility in Massachusetts, and will be receiving an investment from Korean chemicals producer DC Chemical Co. Ltd.

Shares were down $0.88, or 7.4%, to $11.02. They have traded between $6.97 (on Jan. 10) and $16.25 (on April 26, 2006) in the past year.