On The Fly: Top stock stories at midday - InvestingChannel

On The Fly: Top stock stories at midday

Stocks opened little changed, but in positive territory. The Dow and S&P have been weighed down by shares of IBM (IBM), which are down more than 7% for the morning. Despite Big Blue’s losses, the averages are still posting gains for the seventh time in the past eight days. Oil prices are higher after the weekly Department of Energy inventory report showed a drawdown of crude supply versus expectations for a slight build, pushing the price of oil above $68 a barrel. ECONOMIC EVENTS: In the U.S., NYMEX crude rallied to fresh three-plus year highs following EIA inventory data that showed a 1.0M barrel drawdown in crude inventories. The Fed’s Beige Book is scheduled to be released later this afternoon. In Europe, the final Eurozone CPI for March was revised lower from up 1.4% to up 1.3%. Also, Eurozone auto registrations for March declined 5.3%. COMPANY NEWS: Shares of IBM (IBM) declined 7.5% following last night’s Q1 report. A lack of revenue growth “may not be a backbreaker,” but IBM’s “perplexing declaration” that gross margin “stabilization” has arrived despite Q1’s 30 basis point year-over-year decline will likely frustrate investors, Barclays analyst Mark Moskowitz stated in a post-earnings research note… Morgan Stanley (MS) reported first quarter earnings and revenues that topped consensus expectations, with Chairman and CEO James Gorman calling out sales and trading as a “particular highlight in a more active environment.” Just like its big bank peers the last several days, the stock has faded from its opening levels, though Morgan Stanley shares remain fractionally higher near noon… In transportation, shares of rail operator CSX Corporation (CSX) and airline United Continental (UAL) each jumped in early trading after their respective first quarter results came in ahead of consensus forecasts. Near midday, CSX was up 6.5% while United shares rose 6%. MAJOR MOVERS: Among the noteworthy gainers was SunPower (SPWR), which rose 10% after it agreed to acquire SolarWorld Americas. Also higher was Oasis Petroleum (OAS), which gained 8.5% amid the strength in crude after JPMorgan resumed coverage of the stock with an Overweight rating. In addition, Intuitive Surgical (ISRG) advanced over 7.5% after reporting quarterly results. Among the notable losers was Dynagas LNG (DLNG), which fell 12% after it cut its quarterly distribution to 25c per unit from 42.25c. Also lower after reporting quarterly results were Lam Research (LRCX) and ADTRAN (ADTN), which fell a respective 5% and 6%. INDEXES: Near midday, the Dow was up 6 points to 24,792.68, the Nasdaq was up 25.50, or 0.35%, to 7,306.60, and the S&P 500 was up 7.94, or 0.29%, to 2,714.33.

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