What’s the Story? Draghi – 220, 221. Whatever it Takes

by CC July 26, 2012 9:17 am • Commentary

WSJ

U.S. stock futures have turned around sharply. Just before 6 a.m., Dow futures were down about 40 points, but they shot higher after comments hit the Tape from ECB President Mario Draghi at a conference in London, who suggested the bank will do “whatever it takes” to preserve the euro.

As usual, a very detail-laden comment from a European official, yes, we know.

Anyhow, here is what’s got the markets all hot and bothered:

Draghi: ECB Ready To Do Whatever It Takes To Preserve Euro

Draghi: Euro Zone Has Power To Defeat Market Speculation

Draghi: Euro Is ‘Irreversible,’ We’ll Make It Irreversible

Draghi: Last EU Summit Was Great Success

Draghi: Last EU Summit Was ‘Moment Of Recognition’

Draghi: Not ECB’s Job To Act Instead Of Governments

Draghi: Euro-Zone Countries Have ‘Woken Up’ Nationally, Supranationally

There were a lot of others, but you get the flavor. He also made some noises about sharing national sovereignty, breaking the “link” between banks and governments, deposit insurance, and a Eurozone-wide banking supervisor.

This was not any kind of announcement or outline of a new plan. This was merely a reiteration of beliefs. That the market reacted as strongly as it did suggests short covering.

Reuters

The number of Americans filing new claims for jobless benefits fell last week to near a four-year low, a hopeful sign for a labor market that has shown signs of weakness.

Initial claims for state unemployment benefits dropped 35,000 to a seasonally adjusted 353,000, the Labor Department said on Thursday.

That was a much sharper drop than economists expected. The prior week’s figure was revised slightly higher.

The reading for jobless claims has been volatile this month because of the timing of the annual auto plant shutdowns for retooling. The reading had touched a four-year low in the July 7 week at 352,000. One measure that tries to smooth out this volatility, the four-week moving average for new claims, fell 8,750 to 367,250.

CNBC

Those sales masked an otherwise tough quarter for America’s largest oil company. Exxon produced less oil and natural gas from April to June, and it sold both at lower prices. Excluding asset sales, company profit fell by 21.5 percent to $8.4 billion. That’s Exxon’s smallest profit since the third quarter of 2010.

Reuters

** APPLE INC, Wednesday close $574.97, up 0.8 pct premarket

Apple said Samsung Electronics Co Ltd is demanding from the iPhone maker a far higher patent royalty than it pays to other companies, at a rate the South Korean company has never sought from any other licensee.

** BOEING, Wednesday close $74.03, up 1.3 pct premarket

Mexico’s largest airline Aeromexico placed an $11 billion provisional order with Boeing, in what the company said was the biggest aircraft investment by a Mexican airline in that country’s history.

** DOW CHEMICAL CO, Wednesday close $30.27, down 3.4 pct premarket

The largest U.S. chemical maker by sales, reported a 34 percent drop in quarterly profit as sales plunged around the globe, especially in Europe.

** VISA INC, Wednesday close $122.20, up 2 pct premarket

The world’s largest credit- and debit-card network’s adjusted profit topped Wall Street estimates, and it raised its full-year earnings forecast for the second time this year, as more people move to card-based payments globally.

** FACEBOOK INC, Wednesday close $29.34, down 7 pct premarket

The No. 1 social networking company reports results and faces immense pressure to beat Wall Street’s financial targets as it looks to wash away the bad taste left with investors from a soured IPO.

** ZYNGA INC, Wednesday close $5.07, down 39 pct premarket

The game provider slashed its 2012 outlook and quarterly results badly missed Wall Street targets, sending its stock crashing.

The company’s financial performance is unlikely to improve anytime soon, analysts said, after changes to Facebook’s algorithm have made it harder for users to access games such as “Farmville” and “Hidden Chronicles.”

** WESTERN DIGITAL CORP, Wednesday close $32.47, up 17 pct premarket

The hard disk drive maker trounced lofty Wall Street expectations on record sales.

Analysts raised their price targets on the stock, praising its ability to maintain high margins.

** SEAGATE TECHNOLOGY PLC, Wednesday close $26.31, up 11.6 pct premarket

Analysts see Western Digital’s gross margin as a positive for the whole hard disk drive industry, and expect Seagate to post strong results next week despite a production issue revealed last month.

** AKAMAI TECHNOLOGIES INC, Wednesday close $28.25, up 16.3 pct premarket

The internet content delivery company posted better-than-expected quarterly results on higher adoption of its cloud infrastructure services, and forecast an upbeat third quarter.

Several analysts raised their price target on the stock.

** STRAYER EDUCATION INC, Wednesday close $90.70, down 17.3 pct premarket

The company’s quarterly profit just missed analysts’ expectations, but the for-profit college said new-student sign-ups rose for the second straight quarter.

** FORTINET INC, Wednesday close $22.39, up 11.6 pct premarket

The company’s second-quarter revenue rose 25 percent, helped mainly by increased demand for its network security software from large U.S. enterprises.

** CROCS INC, Wednesday close $13.89, up 6.5 pct premarket

The footwear seller reported a quarterly profit that beat Wall Street expectations helped by higher gross margins and growth in Asia, and the shoe maker forecast strong full-year earnings.

** SUNCOR ENERGY INC, Wednesday close $30.41, up 1 pct premarket

The new CEO of Canada’s No. 1 integrated oil producer and refiner said the company is revisiting plans for a massive expansion of its oil sands operations as looks to increase profits.

** AMAZON COM, Wednesday close $217.05, up 1.3 pct premarket

The online retailer declares results in the midst of a massive investment phase which has hammered its earnings in the past year. It is expected to report after markets close.

** LAS VEGAS SANDS CORP, Wednesday’s close $37.51, down 5.4 pct premarket

The company owned by billionaire Sheldon Adelson, posted much worse-than-expected quarterly earnings hurt by lower profits at casinos in its key Asian markets that had previously helped offset flagging U.S. revenue.

** WASTE MANAGEMENT INC, Wednesday close $32.44, down 4.2 pct premarket

The company said it is cutting about 700 jobs as it looks to reduce costs.

** UNITED TECHNOLOGIES CORP, Wednesday close $72.61, up 1.3 pct premarket

The diversified U.S. manufacturer agreed to sell industrial businesses of its Hamilton Sundstrand subsidiary to Carlyle Group and BC Partners Ltd for $3.46 billion, a deal that will help fund United Tech’s largest-ever acquisition.

** STEVEN MADDEN LTD, Wednesday close $32.79, up 0.36 pct premarket

The shoemaker’s quarterly profit missed Wall Street estimates for the first time in more than two years as product-mix changes hurt its margins.

** CONTINENTAL RESOURCES INC, Wednesday close $69.15, down 0.23 pct premarket

The company estimated a 76 percent jump in second-quarter production and said crude oil accounted for more than two-thirds of the output.

** BOSTON SCIENTIFIC CORP, $5.30, up 1.3 pct premarket

The medical device maker reported a second-quarter net loss after charges associated with its Europe, Middle East and Africa unit.

** EVERCORE PARTNERS INC, Wednesday close $20.95

The company’s second-quarter adjusted profit beat Wall Street estimates as more of the boutique investment bank’s deals closed in the quarter, despite a weak merger market.

** WHOLE FOODS MARKET, Wednesday close $84.53, up 11.8 pct premarket

The company reported quarterly profit on Wednesday that topped Wall Street’s view after sales at established stores defied the softening U.S. economy, sending the upscale grocer’s shares surging 11.5 percent in an after-hours relief rally.

Several analysts raised their price target on the stock.

** GROUPON INC, Wednesday close $7.24, down 4.7 pct premarket

Evercore Partners cut its rating and price target on the stock citing transparency concerns and signs of slowing in the company’s core daily deals business.

** COVIDIEN PLC, Wednesday close $51.15

The healthcare products and medical device maker posted a quarterly profit that beat estimates on higher medical devices sales.

** METROPCS COMMUNICATIONS INC, Wednesday close $6.28, up 13 pct premarket

The mobile phone service provider handily beat analysts’ estimates for its second-quarter results, boosted by growth in service revenue.

** TESLA MOTORS, Wednesday close $28.95, up 2.2 pct premarket

The electric car maker said it plans to begin repaying by December more than $400 million in low-interest loans from the U.S. Department of Energy.