Stocks Turn Higher on New Data
Updated from 9:50 a.m. EDT
Stocks in the U.S. were rising early Monday after a report on recent economic data suggested a sluggish, rather than a shrinking, U.S. economy.
The
Dow Jones Industrial Average
, which had a brief stumble out of the gate, was recently up 54 points, or 0.4%, at 13,041. The
S&P 500
was 7 points higher to 1433, and the
Nasdaq Composite
climbed by 12 points at 2541, for gains of about 0.5% each.
Buyers began emerging after leading indicators, a collection of mostly previously released economic data from the Conference Board, ticked up 0.1% in April -- the same as the prior month, and a hair better than what economists were expecting. "These data certainly reflect a weak economy but not one in recession," said the report.
Still, pointed out Art Hogan, chief market analyst with Jefferies, much of what buoyed the overall figure were gains in the stock market. "So it's a self-fulfilling prophecy, to a certain extent," he said. The Board also said that the interest rate spread and improving numbers of housing permits outweighed harsh slides in average weekly hours and consumer expectations.
Hogan pointed out that there are very few other catalysts to move things along today, though "we're still staring down the barrel of a very expensive price for crude, and markets continue rallying in the face of that."
"Something's got to give pretty soon," he said, "and a lot of people it might be crude."
Recently, crude oil was rising 39 cents to $126.68 a barrel, and gold futures were up $6 at $905.90 an ounce. The U.S. dollar was erasing early losses, firming by 0.5% against the euro at $1.5502 and rising 0.4% against the yen to fetch 104.50.
On the corporate front,
Microsoft
(MSFT) - Get Report
, which earlier this month dropped its attempts to take out
Yahoo!
(YHOO)
, over the weekend presented the Internet-portal operator with a
that would not constitute an outright acquisition. The software giant added, however, that it "reserves the right to reconsider" another buyout offer.
The development comes amid billionaire investor Carl Icahn's looming threat to nominate 10 people to Yahoo!'s board. Icahn recently began amassing large amounts of Yahoo! shares, saying the company acted "irrationally" in turning down Microsoft's sweetened takeout bid earlier this month. Microsoft was down 0.4% in recent premarket trading, while Yahoo! was roughly flat.
Microsoft shares shed 1% as Yahoo! added 1.2%.
American Axle Manufacturing
(AXL) - Get Report
last Friday
with the United Autoworkers that would end a costly strike. American Axle is a key supplier to supplier to automaker
General Motors
(GM) - Get Report
, shares of which were up 1.5%.
In earnings, home-improvement retailer
Lowe's
(LOW) - Get Report
said early Monday its
17.9% to $607 million, or 41 cents a share, a penny better than the average analyst estimate from Thomson Reuters. Same-store sales, or those from stores open a year or more, slid 8.4%. Shares were down 2.5%.
Elsewhere,
Campbell Soup's
(CPB) - Get Report
fiscal third-quarter earnings missed Street estimates by a penny a share, excluding a big gain from the sale of its Godiva business. Campbell's adjusted profit was down 7.8% to $165 million, or 43 cents a share. The stock was off 5.2%.
Shares of
National City
( NCC) got a boost after Citigroup upgraded the stock from hold to buy with a $7 price target. Citi said the bank's recent $7 billion capital raise gives it leeway to deal with its credit issues. National City stock climbed 3.6% to $5.78.
However, Citi cut earnings estimates for three brokerage firms, which Citi says may face more losses due to a difficult operating environment.
Goldman Sachs
(GS) - Get Report
,
Lehman Brothers
( LEH) and
Morgan Stanley
(MS) - Get Report
were trading down about 1% each.
Treasury prices were creeping higher. The 10-year note and the 30-year bond were each up roughly 1/32 in price, yielding 3.84% and 4.57%, respectively.
Markets abroad were mostly rising. In Asia, Tokyo's Nikkei 225 added 0.4% overnight, and Hong Kong's Hang Seng Index was ahead by 0.5%. Among European bourses, the FTSE 100 in London tacked on 0.6%. Germany's Xetra Dax and the Paris Cac gained some 0.7% apiece.