Stocks mixed as market reopens for business
POSTED: Thursday, November 1, 2012 - 6:30am
UPDATED: Thursday, November 1, 2012 - 6:34am
NEW YORK (CNNMoney) — U.S. stocks were mixed at the open Wednesday as the markets reopened following a two-day closure due to Hurricane Sandy.
The Dow Jones industrial average rose 0.5 percent and the S&P 500 gained 0.4 percent but the Nasdaq was little changed. Volume is expected to be very high as the NYSE, Nasdaq and other markets execute their first trades after two unscheduled days in the dark.
New York City remained in clean-up mode two days after the battering from the superstorm. But Wednesday will be particularly busy for investors since it is also the last day of the month -- a time when traders, hedge funds and mutual funds often square up their positions.
And for some mutual funds, the day also marks the last trading session of the fiscal year. It's a day when many mutual fund managers will try to offset their capital gains with their losses to minimize distributions paid out to shareholders.
A few traders returned early Wednesday to the New York Stock Exchange in Lower Manhattan, where some of the worst flooding occurred, said Teddy Weisberg, president of Seaport Securities.
Speaking from the corner of Wall Street and Broad Street, Weisberg said the power was still out and phone service was spotty. The smell of diesel fuel was in the air from all the pumps crews were using to drain water from surrounding buildings, he added.
In a symbolic gesture, New York mayor Michael Bloomberg rang the opening bell.
Home improvement retailers such as Home Depot, which rallied 4 percent and Lowe's, which was up almost 6 percent, were viewed as companies that may benefit as consumers and businesses seek to rebuild areas damaged by Sandy.
Shares of Generac, a generator maker, jumped 10 percent after the company boosted its earnings and revenue forecast for the year, as a result of "increased demand for home standby and portable generators" in the aftermath of Hurricane Sandy.
Insurance stocks, such as AIG, which was down more than 1 percent in early trading, Allstate, and Hartford Financial could face pressure.
Retailers, airlines and hotels that have been affected by the storm were also in focus.
World Markets: European stocks were mixed in midday trading. Britain's FTSE 100 was down slightly, the DAX in Germany increased 0.7 percent and France's CAC 40 jumped 0.3 percen%.
Unemployment in the eurozone rose in September to a record high of 11.6 percent, the European Commission's Eurostat statistics agency reported Wednesday.
Asian markets closed higher. The Shanghai Composite added 0.3 percent, while the Hang Seng in Hong Kong and Japan's Nikkei increased 1 percent.
Economy: Investors will weigh data released during the markets' closure, none of which was revelatory. Fresh data on manufacturing and employment costs will be released Wednesday.
Investors will also be gearing up for the crucial October jobs report, which is scheduled to come out Friday. It will be the final reading on the health of the job market before the presidential election next week. While there has been some concern about the report being delayed, the Bureau of Labor Statistics says it is working hard to stay on schedule.
Companies: The storm prompted many companies to postpone their quarterly earnings reports. But others, including Ford, Archer Daniels Midland and TD Ameritrade Holding Corp still issued their results so those stocks may be active Wednesday.
Shares of Ford rose a day after the company reported earnings that remained steady from a year earlier as strong results at home helped balance out the soaring losses in Europe.
Shares of ADM were slightly lower after the grain trader posted earnings that topped expectations but fell 60% from a year ago.
Early Wednesday, GM reported lower quarterly earnings of $1.8 billion on increased losses in Europe. But results topped forecasts, pushing shares of the car maker up almost 5 percent.
Take-Two Interactive reported revenue that topped forecasts, but the software firm cut its earnings and sales outlook for the current quarter.
PVH Corp. the owner of the Calvin Klein and Tommy Hilfiger brands, agreed to buyWarnaco Group in a deal worth $2.9 billion. Warnaco had licensed the Calvin Klein jeans brand from PVH, so the deal brings all Calvin Klein-branded apparel under one company's umbrella.
The Walt Disney Company agreed to buy Lucasfilm in a stock-and-cash deal valued at $4 billion, gaining control of the blockbuster Star Wars franchise.
Many Facebook employees will finally get a chance to sell their shares for the first time Wednesday, after a lock-up on their so called "restricted stock units" expired. A total of 234 million Faebook shares will be newly eligible for sale. Shares of the social network were down about 4 percent.
Currencies and commodities: The dollar fell against the euro and the British pound but gained ground versus the Japanese yen.
Oil for December delivery rose 57 cents to $86.25 a barrel.
Gold futures for December delivery gained $5.90 to $1,718 an ounce.
Bonds: The price on the benchmark 10-year U.S. Treasury fell, raising the yield to 1.73 percent.