Stock Market Update: Late day selloff leads to flat close
Dow -7.34 at 11491.91, Nasdaq +5.66 at 2642.97, S&P +1.04 at 1243.91
[] After opening flat, the market spent most of the morning with moderate changes on this quadruple-witching options expiration Friday. However, stocks got a small boost intraday as the dollar edged back and as yields continued to fall. By the end of the day stocks closed little changed as the result of a late day selloff. The S&P 500 closed up 0.3% on the week, hovering just below the 52-week highs at approximately 1246 set earlier this week. Although the market didn’t make a large move in either direction today, it was an active expiration Friday.
One of the bigger news items of the day was Bank of Montreal’s (BMO 57.26, -4.40) acquisition of Marshall & Ilsley (MI 6.85, +1.06) in a stock-for-stock transaction that values the company at US$7.75, or an aggregate amount of approximately US$4.1 billion. The deal represents a 34% premium to yesterday’s closing share price of Marshall & Ilsley. The news put a bid into other regional banks, such as Regions Financial (RF 6.24, +0.11), Suntrust Banks (STI 27.04, +1.18), and First Horizon National (FHN 10.90, +0.23).
Intermune (ITMN 34.84, +20.57) was another winner today, up 140% after the company announced the Committee for Medicinal Products for Human Use of the European Medicines Agency has adopted a positive opinion recommending the granting of a marketing authorization for Esbriet (pirfenidone) in adults for the treatment of mild to moderate idiopathic pulmonary fibrosis.
Shares of Oracle (ORCL 31.42, +1.15) saw solid gains today after the company released better-than-expected earnings after yesterday’s closing bell. The company’s earnings of $0.51 per share topped the Thomson Reuters consensus of $0.46 per share. Revenues topped street expectations of $8.34 billion with a $8.58 billion reading. The stock hit a 10-yr high earlier this morning, and has remained near those levels all session long. Competitor SAP (SAP 50.00, +0.51) saw gains on its rival’s announcement.
Research in Motion (RIMM 60.58, +1.34) also posted better-than-expected earning’s following yesterday’s close with earnings per share coming in at $1.74 versus expectations of $1.65. Revenues of $5.5 billion were slightly better than the Thomson Reuters consensus of $5.4 billion. The company issued upside guidance for its fourth quarter. Handset maker Nokia (NOK 9.86, -0.05) saw a muted response to the results.
Leading Economic Indicators was the only piece of economic data released today. They showed a 1.1% increase versus the consensus that called for a gain of 1.2%. Last month’s reading was revised to 0.4% from 0.5%.
While today was an active day, the period beginning next week through the end of the year is likely to see diminished trading activity. Markets are closed next Friday for Christmas, and the rest of this upcoming holiday period is likely to be characterized by light news flow, low volumes and choppy trading.
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