After a late rally Monday on China’s reported interest in Italian bonds, the Dow Jones Industrial Average was trading choppily in early-morning action, up about 40 points to more than 11,100. The European debt crisis still has traders anxious, however. Previously, China was expected to help bail out Greece and Portugal. Now Greek one-year bonds yield more than 100%, and 10-years just hit a record high of 23.55%. French banks are the latest to be rumored to be in trouble, leading yields on secure government debt to record lows. “Investors closed their eyes, sold stocks and bought German and U.S. paper,” Andrew Wilkinson of Interactive Brokers said in an International Business Times article. The DJIA is now down less than 1% for the year.
JPMorgan (NYSE:JPM) was up more than 1% to over $32.75, picking up about 40 cents in early-morning action. JPMorgan was upgraded this morning by Stifel Nicolaus to a “buy.” Investors liked what they read in CEO Jamie Dimon’s interview with Financial Times on Monday — the stock is up substantially two days in row after being down more than 6% for the week and almost 30% for the past six months.
Shares of Bank of America (NYSE:BAC) rose more than seven cents, about 1%, to over $7.10. An article in The Wall Street Journal detailed Bank of America’s cost cutting moves that will entail $5 billion in savings as the result of 30,000 layoffs and 600 branch closings by the end of 2013. It has been a busy summer for Bank of America, with assets sales, an investment by Warren Buffett’s Berkshire Hathaway (NYSE:BRK.A), major personnel shifts, a corporate reorganization and now reductions in force and in spending. For the quarter, Bank of America is down more than 35%.
Caterpillar (NYSE:CAT) was plowing ahead in the morning session with gains of about $1.30 and 1.6% per share, trading around $85.20. The Big Cat was touted in several reports this morning. Caterpillar is down about 8% for the month and 18% for the past six months.
The Golden Arches continued to sag over Wall Street as McDonald’s (NYSE:MCD) was down again, off by 50 cents and 0.6% to around $85.70. Credit Suisse lowered its estimate for McDonald’s this morning because of currency shifts and lower sales. McDonald’s is up about 8% for the quarter but down more than 3% for the week.
Wal-Mart (NYSE:WMT) was down about 20 cents, or 0.4%, to under $51.50. A WSJ article discussed how Wal-Mart was bringing back Christmas layaway plans to help financially strapped consumers. For the year, Wal-Mart is down about 2%.
Another consumer giant off in early action was Proctor & Gamble (NYSE:PG), which fell to under $61.60, losing about 20 cents or 0.35% per share. Proctor & Gamble is down more than 1% for the week and almost 4% for the quarter.
Jonathan Yates does not own any of the stocks mentioned in this article.
