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Contributors: Douglas McIntyre Jon C. Ogg

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Wednesday, July 19, 2006

Market Wrap for July 19, 2006


DJIA 11,011.42; Up 212.19 (1.96%)
NASDAQ 2,080.71; Up 37.49 (1.83%)
S&P500 1,259.81; Up 22.95 (1.86%)
10YR-Bond 5.059%

Ben Bernanke must have gotten tired of reading blog postings galore that have accused him of being the main reason for stock selling day after day in May and June. Today, he was the sole cause of the very strong rally. The market was up, but only modestly. When he said that the Fed needed to take extra precaution not to overshoot and when he said the equivalent of "balanced" in more words than non the markets were off to the races.

Housing stocks rallied on Ryand's (RYL) earnings beat and on Bernanke noting the housing market weakness; RYL rose 9% to close at $38.21.

Level 3 Communications (LVLT) rose over 7% to close at $4.34.

Illumina (ILMN) beat their earnings and rose 28% to close at $37.04.

JPMorgan (JPM) posted much better results than expected and its shares rose a dramatic 6% to close at $43.29.

Bank of America (BAC) also beat earnings and rose 3.1% to close at $49.95.

UnitedHealth (UNH) managed to escape the CEO options scandal after it beat earnings and maintained slightly better guidance for the year; UNH rose 5.3% to close at $51.00.

Even Home Depot (HD) manged to close up sharply and put a hush on the calling it Home Despot by closing up 3.6% at $34.34.

IBM (IBM) managed to hang on to their gains of 2.5% to close at $76.12, although it may be disappointing to some that it didn't run up more than where it already was since the market was so strong today.

Nokia (NOK) rose a sharp 3.2% to close at $19.33 after Lehman raised its shares to an Overweight rating, making this the analyst call of the day.

Abbott Labs (ABT) rose 3.4% to close at $46.25 after beating their earnings estimates.

St. Jude Medical (STJ) rose almost 5% to close 33.76 after beating estimates and even with the street shrugging off the company's weak forecast for the second half.

Retail behemoth, and DJIA component, Wal-Mart (WMT) closed up 2.5% at $44.23 after the State of Maryland's verdict that the company would be forced to carry insureance for all employees was overturned.

Companies that issued warnings or that had bad news were not included in the rally today.

Yahoo! (YHOO) has the worst day I can ever recall on a percentage basis by falling 21% to close at a new 52-week low of $25.28. The #2 search and content player met EPS targets but missed and lowered targets on ex-TAC revenues.

Shares of Search giant Google (GOOG) managed to only close down 1% at $399.19 after Yahoo!'s woes.

Digitas (DTAS) fell short of expectations on digital ads and fell 27% to close out at $7.42.

Rambus (RMBS) fell a whopping 13% to close down at $17.05 after it had to restate earnings lower based on options.

ADCT Telecom (ADCT) fell over 12% to close down at $12.50 after lowering its guidance from a merging telecom world and a weak storage spending environment creating tougher orders.

A weak oil market hurt oil stocks, sending Exxon Mobil (XOM) to close up only 0.1% at $64.68; and word that a 17 million share block of stock for sale didn't help matters.

We'll be analyzing the myriad of numbers but you can expect to see reports on Intel (INTC), Motorola (MOT), Apple (AAPL), and eBay (EBAY).

Jon C. Ogg
July 19, 2006

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