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Stocks Slip Amid Hopes For 'Cliff' Deal; J.C. Penney (JCP) Retreats

 December 27, 2012 04:15 PM

(By Balachander) U.S. stocks pared sharp losses earlier and ended on a slightly lower note amid hopes that an agreement will be reached to avert the looming "fiscal cliff".

The S&P 500 Index fell 0.12 percent to end at 1,418.09. The Dow Jones Industrial Average shed 0.14 percent to finish at 13,096.31. The Nasdaq Composite Index dropped 0.14 percent to close at 2,985.91.

President Barack Obama and U.S. House Speaker John Boehner are negotiating to address the so-called "fiscal cliff" of roughly $600 billion in spending cuts and tax increases set to begin in January.

In a latest development, Majority Leader Eric Cantor tweeted that the House will return for legislative business on Sunday, December 30. First votes are expected at 6:30 p.m., Cantor said in a message posted on Twitter. He added the House may be in session through Jan. 2

[Related -Smith & Wesson Holding Corp. (NASDAQ:SWHC) Q2 Earnings Preview: Gonna Fire Blank Guidance?]

Stocks retreated sharply earlier in the day after U.S. Senate Majority Leader Harry Reid warned that a budget deal before Jan. 1 appears unlikely. Reid said it looks like the country is headed over the fiscal cliff.

The number of Americans who continued to receive jobless benefits were fewer than expected last week, a government data showed. Jobless claims fell 12,000 to 350,000 for the week ended Dec. 22 from a revised 362,000, while economists projected 360,000 applications.

Another report showed that new-home sales - which measures the annualized number of new single-family homes that were sold during the previous month - rose 4.4 percent to 377,000 from 361,000 reaching the highest level in more than two years.

[Related -Macy's, Inc. (NYSE:M): Cyber-Monday’S Biggest Winner?]

The Conference Board's consumer confidence index declined to 65.1 in December from 71.5 in November, while economists expected a reading of 70.0.

Hot Stocks Of The Day: JCP, MRVL, SWHC, KAR, NE, BCDS, TSYS

In corporate news, J.C. Penney Company Inc. (NYSE: JCP) lost 5.93 percent after rising more than 4 percent on Wednesday. The Wall Street Journal reported that several retailers may face a challenging 2013.

Marvell Technology Group Ltd. (NASDAQ: MRVL) fell 3.51 percent after a federal jury ordered the company to pay $1.17 billion in damages in a patent infringement suit. Marvell said it will seek to overturn the verdict.

Smith & Wesson Holding Corp. (NASDAQ: SWHC) added 3.77 percent after the maker of firearms said its board authorized an additional $15 million in stock repurchases through June 30, 2013.

KAR Auction Services Inc. (NYSE: KAR) gained 3.58 percent. Stephens upgraded rating on the stock to "overweight" from "equal weight".

Noble Corp. (NYSE: NE) fell 1.31 percent. The offshore drilling contractor said it is working "cooperatively" and "diligently" to rectify deficiencies and maintenance issues raised by the U.S. Coast Guard during a recent inspection of its drillship, the Noble Discoverer.

BCD Semiconductor Manufacturing Ltd. (NASDAQ: BCDS) surged 86.18 percent after Diodes Inc. (NASDAQ: DIODagreed to acquire the China-based company for about $151 million in cash.

TeleCommunication Systems Inc. (NASDAQ: TSYS) shed 3.44 percent after the company said it has sold two of its U.S. patents to IP Cube Partners of South Korea for a multi-seven-figure payment.

Global Markets

European markets closed slightly higher, with Germany's DAX up 0.26 percent to close at 7,655.88. France's CAC40 advanced 0.59 percent to finish at 3,674.26. The U.K.'s FTSE 100 ended flat at 5,954.30.

Asian markets ended mixed, with China's Shanghai Stock Exchange Composite Index down 0.60 percent to finish at 2,205.90. Japan's Nikkei 225 rose 0.91 percent to close at 10,322.98. Hong Kong's Hang Seng Index advanced 0.35 percent to end at 22,619.78. India's BSE Sensex ended at 19,323.80, up 0.48 percent.

Commodity & Currency Scan

Crude oil futures added 0.15 percent to $91.12 per barrel, while natural gas futures slumped 1.12 percent to $3.35 per million metric British thermal units. Gold futures gained 0.28 percent to $1,665.5 per ounce and silver futures rose 0.72 percent to $30.25 per ounce.

In the currency market, the euro advanced 0.14 percent against the U.S. dollar to 1.3242. The British pound slid 0.20 percent against the greenback to 1.6106, while the dollar rose 0.51 percent against the Japanese yen to 86.0700.



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