Today's Morning Primer
Dow, S&P 500 seek fifth week of gains
The Dow and S&P 500 could post their fifth week of gains with a positive session today, following Thursday's modest gains. Both are near breakeven for the week, while the Nasdaq Composite is coming off its best session in two weeks. The three benchmarks have nearly identical gains for the year-to-date, with each rising roughly 19 percent.
Investors will only have one economic report to consider as the week concludes, with the University of Michigan issuing its final July consumer sentiment index at 9:55 a.m. ET. Economists look for the index to come in at 84.0, compared to the preliminary July reading of 83.9 and June's final 84.1.
The pace of earnings slows down somewhat today, with just about half the S&P 500 having reported following Thursday's after-the-bell flurry. This morning's reports include the latest numbers from Tyco (TYC), Weyerhaeuser (WY), Newell Rubbermaid (NWL), Stanley Black & Decker (SWK), and Abbott Labs spinoff AbbVie (ABBV). There are no reports of note after today's closing bell.
Amazon.com (AMZN) leads our list of stocks to watch, as the internet retail giant reports an unexpected second quarter loss of two cents per share, compared to forecasts of a five cent profit. Amazon also issued a cautious current quarter forecast, as it continues to invest in new areas like cloud computing services.
Starbucks (SBUX) earned $0.55 per share for its third quarter, two cents above estimates, and also forecast current quarter profit above current Street consensus. The coffee chain also raised its full year forecast, as new menu offerings help drive customer traffic.
Halliburton (HAL) agreed to plead guilty to destroying evidence in connection with the Deepwater Horizon rig blowout that caused the 2010 Gulf oil spill.
Activision Blizzard (ATVI) and a management group are buying back 84 percent of Vivendi's stake in the videogame maker for $8.2 billion. The company will buy back 429 million shares for $5.83 billion, while an investor group led by CEO Bobby Kotick will buy 172 million shares for $2.34 billion.
Zynga (ZNGA) lost one cent per share for the second quarter, smaller than the four cent loss forecast by analysts. Revenue was above consensus, but its current quarter forecast calls for a wider loss than the Street is expecting. The online gaming company has also abandoned efforts to building a real money gambling business within the U.S.
Expedia (EXPE) reported a second quarter profit of $0.64 per share, excluding certain items, 15 cents below estimates. The online travel service was hurt by a weak performance at its Hotwire unit, as well as increasing expenses.
CBS (CBS) increased its stock buyback program by $5.1 billion to a total of $6 billion.
Tempur Sealy (TPX) reported second quarter profit of $0.36 per share, four cents below estimates, with revenues also short of consensus. The mattress maker also cut its full year forecast, putting both revenue and EPS projections below estimates. The company's Tempur brand is seeing weak sales in the North American market.
Gilead Sciences (GILD) matched estimates with second quarter profit of $0.50 per share, with revenues above estimates. The biotech company's stock is getting a boost on news that rival Vertex (VRTX) experienced a setback in development of a hepatitis C treatment, an area that Gilead is also pursuing.
HealthSouth (HLS) earned $0.51 per share, excluding certain items, for the second quarter, ten cents above estimates, with revenues above forecasts as well. The hospital operator also raised its full year forecast and initiated a quarterly dividend of $0.18 per share.
Cliff's Natural Resources (CLF) reported second quarter profit of $0.82 per share, well above estimates of $0.58. Analysts had expected Cliffs to be hit harder by weaker iron ore prices, which nonetheless helped push profits down 43 percent from a year earlier.
Celanese (CE) doubled its quarterly dividend to $0.18 per share, with CEO Mark Rohr saying the move reflects confidence in the specialty materials maker's ability to generate cash.
KLA-Tencor (KLAC) is forecasting current quarter earnings and revenues well below Street estimates, even as the manufacturer of chipmaking equipment reports top and bottom line beats for its fiscal fourth quarter. Like others in its field, the company is being hurt by the slump in personal computer demand.
Newmont Mining (NEM) cut its quarterly dividend to $0.25 per share from $0.35, reflecting the decline in gold prices.
Google (GOOG) ended a just-announced promotion that gave away three free months of Netflix (NFLX) service when they bought the new Chromecast video device. Google said the offer was ended due to overwhelming demand.