Tag - Nrg

Small-cap stocks started out the week with an impressive rally, riding the crest of climbing energy stocks, signs that the credit crisis is on the improve and talk from Federal Reserve Chairman Ben Bernanke that additional fiscal stimulus could be needed. The Russell 2000 (NYSE:IWM) closed up 20.40, or 3.88% at 546.83. The Russell is now down 29% for the year, while the Dow is off 30% and the S&P 500 is down 33%. Small caps lagged large caps today even on the rally, which is a little bit of concern as the same pattern was evident on the recent collapse.

Crude oil futures climbed 3.3% today as energy traders anticipate OPEC will cut production to counter soft demand and sinking prices. However, while the energy story was the dominant theme today, the move was powered by more than gains in the physical market. Oppenheimer analysts announced upgrades for several stocks in the sector and merger news also played a supportive role, which powered buying in beaten down energy stocks across the market capitalization spectrum. As for the M&A news, NRG Energy Inc. (NYSE:NRG) received an unsolicited bid of $6 billion from Exelon Corp. (NYSE:EXC) and the firm would not rule taking this hostile status if need be. The general rule of thumb is that if there are deals to be made in the large-cap world, then there are probably even more attractive deals to be found in the small-cap spectrum.

Interestingly, the rally today in crude oil and energy stocks was not a general push for commodities. In fact, the U.S. dollar gained about 0.6% versus the euro, which makes dollar-denominated commodities more expensive, and despite the rally in crude oil, the Commodity Research Bureau Index of 19 physical markets was basically flat.

The stock market was already on solid footing overnight on news of another steep decline in the inter-bank (or Libor) lending rate, which suggests that frozen credit lines are starting to thaw and that banks are beginning to trust each other . . .

Small-cap stocks remained higher into midday trading, propelled on the opening by climbing energy shares and optimism over another big pullback on inter-bank lending rates. At 12:31 p.m. ET, the Russell 2000 (NYSE:IWM) was up 6.10, or 1.16%, at 532.53.

An upside surprise on leading indicators data was another supportive element in the mix this morning, but appeared to garner very little market attention. The leading indicators report came in at plus 0.3%, well above the forecast for a dip of 0.2%.

Meanwhile, a morning speech by Federal Reserve Chairman Ben Bernanke came and went without too much fanfare, although the market may have found some solace Bernanke’s assertion that frozen credit markets were starting to thaw and that inflation worries have receded.

The big story so far today has been the energy arena following analyst upgrades on several key stocks and some potential merger and acquisition activity. Researchers at Oppenheimer & Co. raised their forecasts on a raft of oil companies, and the Energy Select Sector SPDR Fund was up about 5.5% into mid-session. Within the small-cap sphere, PrimeEnergy Corp. (Nasdaq:PNRG) was up about 16% while large-capper NRG Energy Inc. (NYSE:NRG) gapped higher and jumped some 21% after receiving a takeover off from Exelon Corp. (NYSE:EXC).

Other small caps of note include Allscripts-Misys Healthcare Solutions Inc. (Nasdaq:MDRX), which was up about 17%, trying to recapture huge losses suffered the last couple of weeks. Along the health line of thinking, WebMD Health Corp. (Nasdaq:WBMD) was up 22% on news that a merger has been terminated.

Technology shares have been lagging the overall market this morning, and have been a mild drag on small caps amid concerns that spending on technology initiatives is not out of the woods because of the slumping economy around the world. The tech-laden Nasdaq 100 Index was up just 0.8% at midday and key large-cap tech . . .

Small-cap stocks opened with a strong bid this morning, boosted by encouraging signs in the bank lending market, a rise in energy stocks on analyst upgrades and a perception that a speech from Federal Reserve Chairman Ben Bernanke was slightly more upbeat than recent appearance. At 10:08 a.m. ET, the Russell 2000 (NYSE:IWM) was up 10.33, or 1.96%, at 536.76.

The initial rush of Bernanke headlines (his speech is released with a time embargo to selected media outlets before he starts talking) included a line that there were some encouraging signs in credit markets and another point that falling commodity prices will bring inflation down (which makes it more likely to see more rate cuts by the Fed).

The leading indicators report came in at 0.3%, which was quite a bit better than the forecast for a dip of 0.2%. This marked the first monthly rise on indicators since April and was clearly good news, but the report often flies under the radar and was particularly overshadowed by the Bernanke watch.

Crude oil futures were up about $1.50 a barrel, providing a lift to energy-sensitive stocks and also to commodities in general. Grains futures were called solidly higher this morning and a bounce in physical markets could provide some relief to downtrodden commodity-themed stocks.

Lost in the shuffle of the inter-bank lending dip and the Bernanke headlines today is the fact that we are deep into peak earnings now, with some one-third . . .

After spiking into the green out of the gate, small caps have since plunged and are flickering in and out of the green and red midday after waning global economic growth weighed on oil, pushing the dollar and larger-cap equities higher.

At 12:30 p.m. ET, the Russell 2000 (NYSE:IWM) slipped 3.46, or 0.46%, to 750.91, while the Dow had gained 18.73, or 0.16, to 11634.66.

Crude has touched a low on today’s session, selling off $3 a barrel to roughly $111 midday and posting a three month low, after OPEC forecasted that global demand for energy continue to falter.

Higher oil prices have pushed input costs for all companies higher and have weighed on operations. A decline in global growth would mean a reduced thirst for oil, which would push down the escalating raw material costs for most firms. However, that slower growth means less demand for final products. So it’s a double edged sword keeping equities in check.

“The global economic race to the bottom appears to be over as the U.S. has hit bottom and the rest of the world is still falling,” Andy Busch wrote in an email today.

The potential slowing global growth’s effect on oil sent the dollar surging to $1.4686 against the euro and 110.47 against the yen midday. The surge in the dollar as of late all started with the European Central Bank’s dovish comments last Thursday followed by reported negative GDP growth in the euro zone.

Small-cap stocks pushed higher in morning trade, carried on the wings of a renewed rally in the U.S. dollar and a slide in global commodities — particularly crude oil. At 9:59 a.m. ET, the Russell 2000 (NYSE:IWM) was up 5.24, or 0.69%, at 759.62; the morning peak in the Russell marked the highest intraday price since Jan. 2.

Small-cap stocks are on the verge of posting the highest weekly close of 2008, a remarkable achievement considering the Dow and S&P 500 are still suffering losses in the 11% range so far this year. Any close today above 747.38 would do the trick. If the Russell were to really catch fire today and push above 766.03, then small caps would actually be in positive territory for the year. The reason it takes a big leap from current yearly high weekly closing levels to positive territory is because the market got hammered the very first trading day of the year and also fell hard when staking the June peak.

Back to the big news today — the U.S. dollar stormed to fresh move highs overnight against both the euro and the Japanese yen, climbing about 0.6% versus both currency markets. The strong upside push in the greenback clearly had a bearish impact on commodities, most notably the crude oil market. Crude oil tumbled some $2 dollars a barrel back below $113 and was hovering just above three-month lows early this morning. The story in commodities wasn’t just an energy tale, however; palladium was down 5% this morning, cocoa was off 2.5%, sugar was down 2.2%, copper tumbled 2.7% in London trading and aluminum prices hit a six-month low. The recent collapse in commodities markets (the Commodity Research Bureau Index has tumbled 17% from the July high) has provided some relief on the inflation front and bolstered investor psychology that consumer spending won’t be crushed by higher gasoline and food prices.

In addition to the dollar/commodities theme, the market also got some bright news this morning on the manufacturing front. The NY Manufacturing Survey came out at plus 2.77, which was much stronger than the forecast for minus 4.4, and marked the first positive reading since April. This survey is for August and marks one of the earliest manufacturing reports of the month, setting a positive tone going forward. When the NY report came out ahead of the opening, stock index futures and the . . .

Small-cap stocks are expected to open higher, bolstered by a rally in the U.S. dollar and a slide in crude oil prices in after-hours trading. The Russell 2000 (NYSE:IWM) was expected to open 0.3% higher, which would translate to an open near 756.60.

Once again, the big story overnight was a surge in the U.S. dollar, which climbed to fresh move highs against both the euro and the yen, rising some 0.6% against both currency markets. The rally in the greenback clearly pulled down commodity markets overseas, with crude oil slipping more than $2 dollars a barrel back below $113, near three-month lows.

The NY Manufacturing Survey came in at 2.77, which was well above the forecast for a slide of 4.4. This marked the first positive reading for the report since April and is a nice upside surprise for the manufacturing sector ahead of several more data releases coming up over the next few weeks. Stocks extended overnight gains as did the dollar on the news.

Still ahead this morning is the industrial production report at 9:15 a.m. ET and the Michigan sentiment survey at 10:00 a.m. ET. Also, Chicago Federal Reserve President Charles Evans will talk about the economic outlook at 1:30 p.m. ET.

Stocks in the news overnight included Lehman Brothers Holdings Inc. (NYSE:LEH), which rallied about 3% on news that billionaire investor George Soros increased his stake in the beleaguered brokerage firm to some 9.5 million shares. NRG Energy Inc. (NYSE:NRG) also attracted a famous investor, with Warren Buffett adding . . .

Small-cap stocks pushed higher Thursday, snapping a string of four consecutive losing days as investors found relief from an intraday reversal in crude oil prices. The Russell 2000 (NYSE:IWM) closed up 5.90, or 0.81%, at 733.01.

“Today was all about reacting to crude oil. In fact, [Wednesday] was about crude oil and Friday is going to be about crude oil. When prices get this extreme at the gas pump, it really makes you wonder if we’re approaching the breaking point for the consumer. If they don’t have discretionary money to spend on things other than gas, then it’s going to have a negative rollover effect on everything else,” said Dominic Boyle, market strategist with Lind-Waldock, in a phone interview.

In order for equity markets to sustain the rally off the March lows, Boyle said, “we will have to get confirmation from crude” in the form of a top, or at least a dramatic slowdown in the escalation of energy prices. After a new record high overnight at $135 dollars a barrel, crude oil futures slipped back to about $131 during the U.S. trading session and left a little potential topping pattern by making new highs and closing lower.

As crude oil tilted off the highs today, the greenback chewed up some recent lost ground, rising about 0.6% against the euro and 1.2% versus the yen. In general, a strong dollar of late has been seen as a positive signal for equities, associated with investment flow into U.S. stocks, and potential unwinding of short dollar/long commodity trades.

In addition, some of today’s upbeat psychology may have been stoked by news of a big acquisition, with NRG Energy Inc. (NYSE:NRG) tendering a bid to purchase Calpine Corp. (NYSE:CPN) for a stock deal worth about $11 billion. If there are . . .

Small-cap stocks opened flat, rose higher in morning trading, and have settled down in midday action. Investors were encouraged by easing crude oil and NRG Energy’s (NYSE:NRG) $11.3 billion offer to buy power generation company Calpine Corp. (NYSE:CPN). At 12:21 p.m. ET, the Russell 2000 (NYSE:IWM) was up 6.71, or 0.92%, at 733.82.

News that NRG Energy tendered a bid to buy Calpine Corp. for a stock deal worth $11 billion injected some enthusiasm back into the M&A picture, and played a supportive role in market psychology. Calpine shares were up 7.07% in midday trading.

Large caps in the news early today include Pfizer Inc. (NYSE:PFE), which tumbled 1.36% on news that its anti-smoking drug had serious side effects. Also, NetApp Inc. (Nasdaq:NTAP) tumbled about 6% as the company’s forward projections disappointed.
Among broad market sectors, apparel retailers, fabricated plastics and rubbers, catalog and mail order retailers and trucking companies were on the upside. Sectors attracting sellers include water transportation, oil well services and equipment, . . .

Small-cap shares opened flat and then edged higher, underpinned by news of a big-cap energy acquisition, a firm tone in the dollar, and ideas that Wednesday’s post-FOMC minutes slide was overdone. At 9:52 a.m. ET, the Russell 2000 (NYSE:IWM) was up 2.46, or 0.34%, at 729.56.

News that NRG Energy (NYSE:NRG) tendered a bid to buy Calpine Corp. (NYSE:CPN) for a stock deal worth $11 billion injected some enthusiasm back into the M&A picture this morning, and played a supportive role in market psychology. Calpine shares were up 7.1% shortly after the opening on the news. If there are large-cap merger deals to be done, then there are certainly bargains to be had within small caps.

There are several apparel retailers coming out with earnings today, which could ripple through the markets. Children’s Place Retail Stores (Nasdaq:PLCE), which is right on the upper end of small-cap market capitalization, reported solid quarterly results this morning and the stock was up 6.2% right after the open.

Large caps in the news early today include Pfizer Inc. (NYSE:PFE), which tumbled 1% on the opening on news that its anti-smoking drug had serious side effects. Also, NetApp Inc. (Nasdaq:NTAP) tumbled 5.7% as the company’s forward projections disappointed.

Crude oil prices shot above $135 dollars a barrel overnight, and continue to be a drag on the both the consumer pocketbook and the cost structure for corporations (just ask the battered airline industry). Goldman Sachs technical analyst Kevin Edgeley said in a research report overnight that crude oil momentum and trend strength are pointing higher, and that there is a long-term channel extension target for crude at $142.90. If crude oil were to close lower today, and well off that $135 record overnight peak, it could generate a topping reversal on charts, and is worth . . .

Small caps were expected to open near steady levels this morning, with caution from another jump in crude oil offset by enthusiasm about a new large-cap acquisition. In overnight trading, the Russell 2000 (NYSE:IWM) was basically flat, while S&P 500 futures were just modestly above fair value.

The weekly unemployment claims report came in a little better than the forecast at 365,000 versus the expectation for 375,000. Equity futures were little changed immediately after the data.

Stock market activity overnight was flat to lower, with European shares hovering near steady levels, while Asia stocks were primarily lower. Hong Kong was off 1.6%, China down 1.9%, Singapore down 1.1% and Bombay lower by 1.9%.

There was news of a large-cap acquisition overnight between NRG Energy (NYSE:NRG) and Calpine Corp. (NYSE:CPN), in an $11 billion stock deal that could energize the bullish argument somewhat today.

Other big caps in the news this morning included Pfizer Inc. (NYSE:PFE), which was off about 1.5% on news that their anti-smoking drug had side effect issues. Also, NetApp Inc. (Nasdaq:NTAP) was down a whopping 14% as the firm’s projected earnings and revenues were below analyst expectations. PetSmart Inc. (Nasdaq:PETM) shares were off more than 5% overnight on lower-than-expected forward guidance.

Crude oil spiked higher yet again overnight, this time topping $135 dollars . . .