With the White House and Congress appearing to have reached an impasse on fiscal cliff negotiations, investors chose to err on the side of caution, which resulted in a stagnant stock market.
Chip Cobb, portfolio manager at BMT Asset Management in Bryn Mawr, Penn, asserted that “the country, the economy and the American people just want to move on at this point. Yes, you have extremes of how this should be drawn up, and everybody has an educated opinion, but the general public, and the market would agree, that it's an uncertainty issue, and nobody likes uncertainty,” according to MarketWatch
The Nasdaq Composite
(INDEXNASDAQ:.IXIC) was down 0.57% to 2,985.14 points on average trading volume of 745.07 million as of 12:06 p.m. EST.
(NASDAQ:GALE) was among the great gainers on the Nasdaq, surging 10.29% to $2.25. The company announced earlier in the day that it has signed a deal with Teva Pharmaceutical Industries
(NYSE:TEVA) for the latter to develop and market its cancer treatment NeuVax in Israel. If approved by Israeli regulators, Galena added that it stands to get "significant royalty payments" on NeuVax sales.
(NASDAQ:FSLR) also gained 2.87% to $28.29. After a meeting with the company’s executives, Lazard reiterated its buy rating on shares of the solar power company.
After two days of losses, Zynga
(NASDAQ:ZNGA) also rebounded 1.30% to $2.26, while Clearwire Corporation
(NASDAQ:CLWR) advanced 3.12% to $2.48. According to Seeking Alpha
, Clearwire shares, along with those of First Solar’s, were among the most sought-after technology shares by institutional investors in the last quarter.
South Africa’s Net 1 Ueps Technologies
(NASDAQ:UEPS) suffered the biggest plunge by far, diving 56.76% to $3.39. The company said it was under investigation by the US Justice Department and FBI on alleged corruption charges.
Melco Crown Entertainment
(NASDAQ:MPEL) also fell 7.94% to $14.15. According to a Street Insider report, Macao police are cracking down on casino junket operators in the region, which does not bode well for casino operators like Melco, Las Vegas Sands
(NYSE:LVS) (-2.96%), Wynn Resorts
(NASDAQ:WYNN) (-3.76%), and MGM
(NYSE:MGM) (-2.51%). Junket operators act as middlemen between casinos and high rollers.
(NASDAQ:BIDU) was also off 6.74% to $89.44. The Chinese Internet search giant has been rocked from strong competition from upstart and search competitor, Qihoo 360
(NYSE:QIHU), whose stock has hit a new 52-week high in recent days.
(NASDAQ:GRPN) continued its recent topsy-turvy ride, falling 5.35% to $3.89. Apple
(NASDAQ:AAPL) also declined 1.79% to $575.67. In a note, Steven Milunovich of UBS said that Apple was not likely to see further P/E expansion.
“The experience of Google
(NASDAQ:GOOG) and Microsoft
(NASDAQ:MSFT) suggests that P/E expansion largely is over once margins peak and earnings growth moderates,” he wrote. “Even bursts of faster revenue growth don’t tend to boost the multiple.”
Apple’s upside will have to depend on “new products[which] still have the potential to drive earnings growth and create value by earning cost of capital,” he added.
No positions in stocks mentioned.
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