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Stocks End Mixed After Bernanke Speech; Wal-Mart (WMT) Retreats

 December 12, 2012 04:46 PM
 


(By Balachander) U.S. stocks closed on a mixed note, paring earlier gains, as investors weighed remarks by Federal Reserve Chairman Ben Bernanke on the so-called "fiscal cliff" and the central bank's decision to expand its bond-buying plan.

The S&P 500 Index inched up 0.04 percent to end at 1,428.48. The Dow Jones Industrial Average shed 0.02 percent to finish at 13,245.45. The Nasdaq Composite Index dropped 0.28 percent to close at 3,013.81.

"We cannot offset the full impact of the fiscal cliff - it's just too big," Bernanke told a news conference.

The Fed unveiled a new bond-buying plan worth $45 billion a month of longer-term Treasury securities starting January. This is in addition to $40 billion per month purchase of mortgage-backed securities.

[Related -Target Corporation (TGT) Dividend Stock Analysis]

The Committee will continue asset purchases "if the outlook for the labor market does not improve substantially," the Fed's policy-making arm said at the conclusion of a two-day meeting in Washington.

The Fed said the federal funds rate will be appropriate at least as long as the unemployment rate remains above 6.5 percent and if inflation is projected to be no more than 2.5 percent.

Investors also eyed negotiations in Washington over a deal to avert the looming "fiscal cliff". President Barack Obama has pushed for higher taxes on wealthy Americans to address the fiscal cliff of roughly $600 billion in spending cuts and tax increases that could hit economic growth.

On the data front, a government report showed that import prices fell 0.9 percent in November after a 0.5 percent gain in October, sharper than economists expectations of a decline of 0.4 percent. Export prices also dropped 0.7 percent after remaining unchanged in October.

Hot Stocks Of The Day: WMT, LLY, DD, BRK.B, AET, JOY, MCP, HES, CRL, YMI

[Related -Costco Wholesale Corporation (NASDAQ:COST) Q1 Earnings Preview: Membership Fees Or Bust]

In corporate news, Wal-Mart Stores Inc. (NYSE: WMT) retreated 2.75 percent amid reports that Indian government launched a probe into the retail giant's lobbying practices.

Eli Lilly & Co. (NYSE: LLY) shed 3.16 percent after the pharma giant announced plans to conduct an additional late-stage study of solanezumab in patients with mild Alzheimer's disease.

DuPont (NYSE: DD) rose 1.40 percent after the chemical maker said it expects earnings for 2012 at the high end of its forecast and announced a $1 billion share buyback plan.

Berkshire Hathaway Inc. (NYSE: BRK.B) added 2.35 percent after the Warren Buffett's company said it purchased $1.2 billion of its own shares from the estate of a long-time shareholder.

Aetna Inc. (NYSE: AET) advanced 3.21 percent after the health insurer projected earnings and revenue growth for 2013.

Joy Global Inc. (NYSE: JOY) jumped 3.97 percent after the provider of mining equipments posted better-than-expected quarterly earnings and sales.

Molycorp Inc. (NYSE: MCP) lost 3.00 percent after the rare-earths producer announced that Chief Executive Officer Mark Smith has left the company. Molycorp named Constantine Karayannopoulos as interim chief executive.

Hess Corp. (NYSE: HES) added 2.91 percent after the energy company announced discovery of oil offshore Ghana.

Charles River Laboratories (NYSE: CRL) tumbled 9.29 percent after the outsourced preclinical services company forecast 2013 earnings that trailed market expectations.

YM BioSciences Inc. (NYSEAMEX: YMI) surged 75.15 percent after the Canadian drug developer agreed to be acquired by Gilead Sciences Inc. (NASDAQ: GILD) for US$2.95 per share in cash.

Global Markets

European markets ended higher, with Germany's DAX advancing 0.33 percent to close at 7,614.79. France's CAC40 inched up 0.01 percent to finish at 3,646.66. The U.K.'s FTSE 100 rose 0.35 percent to end at 5,945.85.

Among Asian markets, China's Shanghai Stock Exchange Composite Index added 0.39 percent to finish at 2,082.73. Japan's Nikkei 225 gained 0.59 percent to close at 9,581.46. Hong Kong's Hang Seng Index rose 0.80 percent to end at 22,503.35. India's BSE Sensex ended at 19,355.26, down 0.16 percent.

Commodity & Currency Scan

Crude oil futures gained 1.15 percent to $86.78 per barrel, while natural gas futures dropped 0.47 percent to $3.40 per million metric British thermal units. Gold futures added 0.28 percent to $1,714.4 per ounce and silver futures jumped 1.71 percent to $33.58 per ounce.

In the currency market, the euro gained 0.46 percent against the U.S. dollar to 1.3065. The British pound rose 0.14 percent against the greenback to 1.6137, and the dollar added 0.82 percent against the Japanese yen to 83.2000.

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