Tag - Anr

Small-cap stocks reversed course, putting a brief but sharp morning slide on awful economic data in the rear-view mirror as investors gobbled up homebuilding, retail and financial shares and set aside any economic worries stirred by sobering private employment and services sector activity reports.  Some of today’s small-cap gainers are Forest City Enterprises Inc. (Nasdaq:FCE.B), Grey Wolf Inc (NYSE:GW) and Orthofix Intl. (Nasdaq:OFIX).

Other Market Watch highlights today included:

• Crude oil prices stabilized after weekly inventory reports showed a decline in crude oil stockpiles and a drop in refined products.  
• Obama: Automakers appear to be formulating “more serious” business models to help justify a government bailout of the ailing sector.  
• The ISE Homebuilders Index jumped 10% and small-cap homebuilders were among the best performers in the group.  
• The ability to rally after a bad reading on the ADP Employment Survey ahead of Friday’s big monthly employment report was a positive sign.


Small Cap Gainers:

• Forest City Enterprises Inc. jumped 26% as the commercial property firm benefited from the bounce in homebuilder and REITS. See (Nasdaq:FCE.B).  
• Grey Wolf Inc. rose 23% as the oil and gas driller announced a merger deal with Precision Drilling Trust. See (NYSE:GW).  
• Orthofix Intl. climbed 21% on news that a large owner in the firm is pushing for it to call a special shareholder meeting and sell a medical business unit, reduce corporate overhead. See (Nasdaq:OFIX).  
• Other small-cap homebuilders rallying today were Lennar Corp., which was up 8%, and KB Home, which soared 16%. See (NYSE:LEN) and (NYSE:KBH).

Small Cap Losers:

• Infineon Technologies sees a widened Q4 loss; shares careen 38%. See (NYSE:IFX).  
• IIVI Inc. was off 15% as the electronics and telecommunications manufacturing company revised guidance downward. See (Nasdaq:IIVI).  
• Alpha Natural Resources Inc. fell 14% as the coal miner revised guidance. See (NYSE:ANR).  
• Bucyrus sinks 7.4% in pre-market after completing its purchase of Czech firm, OKD Bastro. See (Nasdaq:BUCY). 

Small-cap stocks reversed course, putting a brief but sharp morning slide on awful economic data in the rear-view mirror as investors gobbled up homebuilding, retail and financial shares and set aside any economic worries stirred by sobering private employment and services sector activity reports. At 12:26 p.m. ET, the Russell 2000 (NYSE:IWM) was up 4.75, or 1.07% at 446.57.

Small caps were leading the way on the midday surge, which suggests that investors were willing to take on a more aggressive posture and not just sit on defensive, low-risk plays. Along that theme, yields on Treasury products were higher as demand clearly was more focused on riskier fare today.

The ability to rally in the face of a bad reading on the ADP Employment Survey ahead of Friday’s big monthly employment report was a positive sign for the market. In addition, the ISM non-manufacturing survey came in well below the forecast, showing the services sector of the economy is mired deep in recession.

Homebuilder stocks were in rally mode Tuesday and remained a hot item today. The ISE Homebuilders Index jumped 10% and small-cap homebuilders were among the best performers in the group. Centex Corp. (NYSE:CTX) was a star Tuesday and jumped another 12% today. Meanwhile, Lennar Corp. (NYSE:LEN) was up 8% and KB Home (NYSE:KBH) soared 16%. Homebuilder shares appear to be attracting bargain hunters amid sentiment that the government’s new focus on lowering long-term and mortgage rates will spur renewed activity in the housing sector and generate fresh refinancing at lower interest rates. President-elect Obama said today that homeowners inability to pay mortgages is a key part of the recession.

Obama also said that automakers appear to be formulating “more serious” business models to help justify a government bailout of the ailing sector. Ford Motor Co. (NYSE:F) was up 5%, but General Motors Corp. (NYSE:GM) was down . . .

Small-cap stocks took flight Wednesday, as investors embraced a spate of relatively positive earnings results and another slide in crude oil as a sign that the market may have weathered the worst of the summer storm. The Russell 2000 (NYSE:IWM) jumped 24.39, or 3.68%, to 686.75, notching the fourth-largest one-day advance of the year, powered by gains in financial and tech stocks.

The impressive rally topped off a picture perfect validation of a bullish chart pattern from Tuesday’s recovery bounce off fresh move lows, and further upside action this week would cement the most powerful technical analysis bullish signal in months. In addition, the heightened volatility in recent days fits with similar whipsaw price action at the lows back in January and March.

The market was also able to carve out today’s sizable gains despite another serving of bearish economic headlines. When the market starts to work higher in the face of bearish news, it is considered a classic show of strength — especially if the move is powered by more than just short-covering amid oversold conditions. While we wait for further confirmation of the recovery off Tuesday’s lows, let’s recap what the market overcame on the data front today.

The big report this morning was the Consumer Price Index release. For the second consecutive day, the market was slapped in the face with sobering inflation news. The headline figure for CPI came in at plus 1.1%, which was the largest monthly advance in 26 years. What’s more, the year-over-year increase was at a whopping 5%, which is the largest rise in consumer prices since 1991. In short, the CPI news was every bit as troubling as Tuesday’s Producer Price Index report, where the year-over-year figure was the highest since June 1981. And the inflation data simply adds to the woes from slumping housing, GDP and labor market reports of recent months.

So, if we are truly mired in a slow growth, rising unemployment, escalating inflation world, then why on earth did small caps put together such an impressive rally today? The easy part of that question is that crude oil prices tumbled down to . . .