Markets Keep on Movin’ Up — Monday’s IP Market Recap

by Marc Bastow | August 6, 2012 5:09 pm

[1]U.S. markets carried over their momentum from Friday’s rally, as investors remained upbeat over a stronger-than-expected jobs report[2] and positive bond news across the pond. All in all, the first trading-day anniversary of the U.S. debt downgrade from AAA (actually Sunday) came and went with little fanfare, but positively.

The Dow Jones Industrial Average moved ahead 0.16% to finish at 13,117, the S&P 500 ended up 0.23% at 1,394, and the Nasdaq rode a tech surge to finish up 0.74% at 2,989.

The day’s biggest splash came early, as Best Buy (NYSE:BBY[3]) founder Richard Schulze announced a bid to take the company private[4] with an offer between $24 to $26 per share, or about $8.8 billion total. Investors were cheered by the news[5], as shares initially jumped nearly 20% before settling in with a 13% gain to close at $20.

Global financial services firm Knight Capital (NYSE:KCG[6]) avoided a total financial catastrophe through a $400 million rescue plan[7] arranged by Jefferies Group (NYSE:JEF[8]) on Sunday. The market maker’s status has been revoked by the NYSE because of last week’s trading problems[9], and KCG finished down over 22% on the day.

Technology stocks rallied during the day, helped in part by a strong earnings report from IT firm Cognizant Technologies (NASDAQ:CTSH[10]). Cognizant beat Street earnings expectations[11] by 8 cents per share on higher-than-expected revenues. The company also provided forward guidance in line with analyst expectations, and shareholders were rewarded as the stock headed up over 10% on the day. BMC Software (NASDAQ:BMC[12]) and Red Hat (NYSE:RHT[13]) followed suit, gaining a respective 3% and 2%.

Earnings news led Tyson Foods (NYSE:TSN[14]) the other way, down 8% after falling short of Street expectations[15] on revenues and coming in with earnings 61% below last year’s figures. Competitors Smithfield Foods (NYSE:SFD[16]) and Hormel (NYSE:HRL[17]) fell in sync with Tyson, with SFD down more than 2% and HRL shedding 1%.

Finally, Apple (NASDAQ:AAPL[18]) shares continued a recent climb after last quarter’s “disappointing” earnings[19], peaking Monday at just under $625 per share before settling in up 1% at $622 per share. Rumors continue to swirl around Apple joining the DJIA to replace Kraft (NASDAQ:KFT[20]) — a move that would involve either a split in the stock or an index recalculation to avoid an overweighting in the index.

Tuesday brings more earnings reports including Emerson Electric (NYSE:EMR[21]) and Walt Disney (NYSE:DIS[22]).

Three Up

• Nii Holdings (NASDAQ:NIHD[23]): Up 18.8% ($1.28) to $8.08.
• First Solar (NASDAQ:FSLR[24]): Up 11.7% ($2) to $19.06.
• Navistar (NYSE:NAV[25]): Up 10% ($2.23) to $24.62.

Three Down

• SuperValu (NYSE:SVU[26]): Down 8.95% (23 cents) to $2.34.
• HCA Holdings (NYSE:HCA[27]): Down 3.95% ($1.05) to $25.55.
• Goodrich Petroleum (NYSE:GDP[28]): Down 2.9% (32 cents) to $10.85.

Marc Bastow is an Assistant Editor of InvestorPlace.com. As of this writing, he was long AAPL.

Source URL: https://investorplace.com/2012/08/mondays-ip-market-recap-bby-kcg-jef-ctsh-bmc-rht/

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