Minyanville's Market Recap: Bulls Power Ahead, Markets End Higher
Gold hits $93. UBS warns of losses and Merrill kicks out its CEO. Bulls still power ahead.
Investors awoke to cries from within the financial sector. UBS (UBS) confirmed its third quarter losses to be between $515.5-687.3 mln, in-line with reports the company released earlier this month. Furthermore, the bank warned investors of further write-downs due to mortgage-related assets still held on the bank's books. UBS, however, did attempt to relieve investors' concern, stating the quarter was off to a positive start. UBS closed down -1.08% to $53.25.
In another casualty resulting from this summer's credit crunch, Merrill Lynch (MER) forced out its CEO Stan O'Neal. Mr. O'Neal had been on the bubble ever since the company posted $8.4 bln in write-downs with $7.9 due to mortgage-related securities. The breaking point seemed to be when Mr. O'Neal sought a merger last week without approval from the board. With Mr. O'Neal's ousting, investors seemed to be pleased as MER closed up +2.01%. Other financials performed similarly. Goldman Sachs (GS) hit a new all-time high closing +3.34% to 243.81. Lehman Brothers (LEH) added +3.87% to 62.76. But Bear Stearns (BSC) was a laggard losing -1.44% to 114.54. . For more, read Toddo's Monday Morning Quarterback.
In commodities action, crude oil made headlines again, breaking above the $93 per barrel level amid tensions in the middle east, production halts, and the falling dollar. Oil settled in +$1.67 at $93.53. Professor Krueger recently mentioned Dryships (DRYS) in The Benefits of Higher Prices. DRYS surged +6.28% to $130.97. Diana Shipping (DSX) also touched a new high adding +6.41% to $44.82 along with Eagle Bulk Shipping (EGLE), +3.82% to $35.29. However, Toddo continued to note the lagging performances of the drillers in respect to the movement in crude. For more, read his Random Thoughts.
In other parts, gold finished higher +0.66% to 789.10. Silver added +1.05% to 14.43, and Copper lost -0.47% to $351.30. With the surge in commodities, Professor Limantour noted on the Buzz the slew of ETF's in the commodities space. Click on Minyanville's Buzz Bits for more summaries on the Buzz & Banter.
In earnings news, Kellogg (K) reported third quarter earnings of $0.76 versus analyst estimates of $0.73. Revenues came in at $3 bln vs. $2.99 cons.
Humana (HUM) reported $1.53 EPS versus analyst estimates of $1.48. Revenues were $6.32 bln versus $6.22 bln cons.
Office Depot (ODP) stock plunged -17% after the company delayed its third-quarter earnings to review accounting for supplier payments. Read Professor Macke's Finding Value in Office Depot.
Below is a recap of some of the idea flow on today's Buzz & Banter. Please note that stocks may appear in both bullish and bearish categories, due to long and short term trades by our many Minyanville professors.
Some bullish trade or investment ideas: PCU, ARTW, WFR, ASTI, VMW, SPWR, GRMN, DELL, GPS, MSFT, NVLS, SCHW
Some bearish trade or investment ideas: SPX, DXY, AAPL, SLE, GDX, BKUNA, BBX
Monday isn't so bad, is it? Have a great night and see you tomorrow!
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