Lifeless Markets End in Holding Pattern
FOX Business: The Power to Prosper
After bouncing between minor gains and losses throughout the day, Wall Street landed on the fence on Monday, preserving virtually all of last week’s big gains.
Today’s Markets
The Dow Jones Industrial Average fell 19.90 points, or 0.17%, to 11362.19, the Standard & Poor's 500 slid 1.59 points, 0.13%, to 1223.12 and the Nasdaq Composite added 3.46 points, or 0.13%, to 2594.92. The FOX 50 declined 1.45 points, or 0.17%, to 873.10.
By closing mostly unchanged, Wall Street managed to shrug off early concerns about Europe's sovereign debt crisis that were sparked by weakness in the euro. Those worries faded a bit as the euro erased about half of its losses.
Underscoring how directionless U.S. markets were on Monday, the Dow moved in a very tight range of just 41 points and on very thin volume. Last week the benchmark index surged nearly 300 points and ended at three-week highs amid mostly stronger-than-expected economic headlines and calmer European markets.
Roughly half of the 30 blue-chip stocks closed higher, led by Cisco Systems (NASDAQ:CSCO) and JPMorgan Chase (NYSE:JPM). The worst performers on the Dow were Bank of America (NYSE:BAC) and Coca-Cola (NYSE:KO).
The Nasdaq Composite outperformed the broader markets amid solid gains from Apple (NASDAQ:AAPL) and Google (NASDAQ:GOOG).
Without any major economic or earnings reports on the domestic front, traders on Monday took their cues from the currency markets. The euro, which tends to move in tandem with U.S. stocks, took an early dive amid reports that Germany opposes increasing the size of its $1 trillion bailout fund and is against the creation of euro zone bonds. However, the currency closed down just 0.45% to $1.3320, taking some pressure off stocks.
Wall Street had a muted reaction to the "60 Minutes" interview of Federal Reserve Chairman Ben Bernanke, who said the central bank is open to more stimulus measures if inflation remains tame and the economy needs it.
In the commodities complex, crude oil flirted at fresh two-year highs, gaining 19 cents a barrel, or 0.21%, to $89.38. Gold jumped $9.90 a troy ounce, or 0.70%, to $1,415.30 -- a new record.
While it was a relatively quiet day for the major indexes, there were a number of major corporate stories, including the unexpected resignation of Pfizer (NYSE:PFE) CEO Jeffrey Kindler. Kindler, who cited fatigue, will be replaced by Pfizer veteran Ian Read.
Also, Borders (NYSE:BGP) surged 28% after shareholder Bill Ackman said he would finance a potential $963.7 million Borders buyout of larger rival Barnes & Noble (NYSE:BKS). Ackman owns a 37.3% stake in Borders. The news sent Barnes & Noble’s stock jumping 11%.
Corporate Movers
Wal-Mart (NYSE:WMT) won a small victory when the U.S. Supreme Court said it will hear an appeal by the retailer in a multibillion dollar class lawsuit filed against it. The lawsuit is the largest sexual discrimination class-action lawsuit in U.S. history.
AOL (NYSE:AOL) is considering breaking itself up through a complicated series of moves leading to a potential merger with Yahoo! (NASDAQ:YHOO), Reuters reported. However, the plans are still in an exploratory stage and Yahoo! hasn’t been contacted, the wire service report. It would also be highly complicated with a number of moving pieces.
Lender Processing Services (NYSE:LPS) slumped 6% after Reuters reported the foreclosure kingpin prepared questionable foreclosure documents on a much wider scale than previously disclosed. Pending investigations and lawsuits pose a bigger threat to Lender Processing than the company's CEO has let on, the wire service reported.
Google’s (NASDAQ:GOOG) $6 billion quest to acquire local deals site Groupon has collapsed, The Wall Street Journal reported. The two sides broke off talks as Groupon’s board was divided on whether to accept the bid. Google also launched its eBooks venture, taking on rivals Apple (NASDAQ:AAPL) and Amazon.com (NASDAQ:AAPL).
Sprint Nextel (NYSE:S) jumped 7% after announcing plans to shut down its Nextel network in 2013 and selected Alcatel-Lucent (NYSE:ALU), Ericsson (NASDAQ:ERIC) and others to handle a massive overhaul effort worth as much as $5 billion.
Massey Energy (NYSE:MEE) CEO Don Blankenship surprised shareholders by announcing plans to retire at the end of the year, making a sale of the embattled coal company more likely, the Journal reported. Blankenship had been seen as opposing the proposed sale of Massey to rival Alpha Natural Resources (NYSE:ANR).
Kellogg (NYSE:K) CEO David Mackay announced plans to resign at the end of the year. The cereal maker said John Bryant, the chief operating officer, will replace Mackay. Kellogg also reaffirmed its 2010 and 2011 financial guidance.
Dollar General (NYSE:DG) slid 7% after posting a weaker-than-expected 10.1% rise in third-quarter revenue to $3.22 billion. Analysts had been looking for $3.23 billion in sales. On the other hand, Dollar General's non-GAAP EPS of 39 cents beat the Street and it upped its full-year profit outlook.
Global Markets
The U.K.'s FTSE 100 rose 0.43% to 5770.28, France's CAC 40 lost 0.04% to 3749.23 and Germany's DAX inched up 0.10% to 6954.38.
In Asia, Tokyo's Nikkei 225 fell 0.11% to 10167.20, Hong Kong's Hang Seng slid 0.36% to 23237.70 and China's Shanghai Composite advanced 0.52% to 2857.18.