This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Stock Gains Muted Amid Fretting Over Debt

NEW YORK ( TheStreet) -- A weak reading on consumer sentiment and unresolved debt issues in the U.S. put a lid on stock gains even as strong earnings from Google (GOOG) kept the Nasdaq firmly in positive territory.

The Dow Jones Industrial Average finished up 43 points, or 0.3%, at 12,479. The S&P 500 climbed higher by 7 points, or 0.6%, to 1316, and the Nasdaq gained 27 points, or 1%, to 2790.

Investors were cautious given that lawmakers indicated that answers surrounding the debt ceiling would not come until next week at the earliest. House Republican Leader Eric Cantor said the House will vote on a bill that would raise the debt ceiling by $2.4 trillion, cut spending and possibly balance the budget. However, the bill is expected to die in a Democrat-led Senate after GOP approval.

Cantor's comments came this morning after Standard & Poor's raised the pressure on Washington by warning that it could cut its rating on U.S. government debt before the U.S. actually defaults on some of its financial obligations. The U.S. Treasury has estimated that the government has until Aug. 2 before it faces default.

President Barack Obama warned that failing to raise the government's borrowing limit would push up interest rates, effectively creating a tax increase for everyone. Obama also said that while the parties will likely reach some kind of an agreement, he still hopes for a broader debt-reduction plan.

During Friday's afternoon session, ratings agency S&P said certain U.S. financial stocks could be downgraded if the U.S. loses its triple-A credit rating.

Strong earnings and deals news gave stocks a boost in early trading.

Shares of Google gained 12.5% to close at $595.22 after the Internet search giant easily beat Wall Street's expectations late Thursday with a quarterly profit of $8.74 a share on revenue of $6.92 billion. Analysts had been looking for earnings of $7.85 a share on revenue of $6.55 billion.

Citigroup (C) topped analysts' estimates with a second-quarter profit of $1.09 a share and revenue of $20.6 billion, while Wall Street had been projecting earnings of 96 cents a share on revenue of $19.89 billion. The stock soared during the morning trading session but was last down by 1.6% at $38.40.

Shares of Petrohawk Energy (HK) soared 62.6% to $38.20 on news that mining giant BHP Billiton (BHP) wants to buy the oil and natural gas company for $38.75 a share, representing a total equity value of roughly $12.1 billion and a total enterprise value of about $15.1 billion. BHP's stock closed down 1.5% at $90.87.

Clorox (CLX) saw its stock surge 8.8% to $74.42 on news that Carl Ichan offered to buy the company for $76.50 a share, or roughly $12.6 billion . According to a regulatory filing, the bid values Clorox shares at a 12% premium to Thursday's closing price. Ichan-controlled entities currently hold 9.4% of Clorox's outstanding stock, making him the company's largest shareholder.
1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
BAC $17.44 -0.17%
DIS $118.67 0.61%
JPM $66.86 0.12%
MSFT $53.69 -1.03%
PFE $32.87 2.82%


Chart of I:DJI
DOW 17,813.39 +1.20 0.01%
S&P 500 2,088.87 -0.27 -0.01%
NASDAQ 5,116.1430 +13.3350 0.26%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs