General Motors was up 3 percent pre-open. (See ticker for regular trading hours quotes.) The quiet period following the Nov. 17 IPO ended Monday night, so there are lots of analyst recommendations out — and they are mostly bullish, most with price targets 20 to 40 percent above the closing price yesterday.
The stock closed at $34.60 yesterday (Monday), but several have targets above $40: RBC Capital and Barclays at $42, Credit Suisse at $43, J.P. Morgan at $44, Bank of America Merrill Lynch and Citigroup at $45, Morgan Stanley at $50 (!). All are initiated with a buy or outperform or overweight.
What's up with Soleil, with a GM price target at a measly $38 and a Hold rating? "Our $38 per share target price assumes the low end of the range on an EV/EBITDA basis and the middle of the range on a P/E basis, averaging expected 2011 and 2012 earnings," the firm said. In other words, they are being conservative.
1) The International Council of Shopping Centers reported that chain store sales in the latest week (ended December 25) rose 4.8 percent year-over-year. That's the best gain for sales since April as last-minute holiday sales were strong heading into the Christmas holiday.
The Council also believes that December comps will rise 3.5 percent and holiday season (November-December) comps will increase 4 percent - the most since 2006 and at the high end of prior forecasts.
2) Molycorp , a proxy for the rare earth trade, up 9 percent yesterday, up another 5.5 percent pre-open, is the biggest percentage gainer on the NYSE pre-open and one of its most actively traded. There are reports that China has reduced its rare earth export quotas for 2011. Rare Element also trading up.
3) China's Shanghai Composite fell 1.7 percent (down 5 days in a row) and Hong Kong's Hang Seng index fell 0.9 percent on worries that China's latest interest rate increase may be the first of a number of rate hikes to help contain inflation. Both indices are sitting at their lowest levels since the beginning of October, with the Shanghai Composite falling 3.7 percent over just the past 2 days.
4) Commodities and commodity stocks are rising as the Dollar Index (.DXY) is falling to a 2-week low. The dollar is now sitting at a historic low vs. the Swiss Franc.
5) Alcatel-Lucent rises 1 percent despite receiving a $137 million fine by the SEC and Department of Justice. The penalty will settle bribery charges against the telecom equipment company to allegedly win over business in Asia and Latin America.
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