Market Lower as Greece Bailout Optimism Fades

Published on Wednesday, 22 February 2012 13:43 Written by J Hawk

New York, February 22^nd (TradersHuddle.com) – Stocks opened flat to marginally lower this morning as optimism over Greece — which began wearing off at the end of yesterday’s session — finally getting approval for its second bailout, faded. Also, U.S. Existing Home Sales came in lower than analyst expectations.

The Dow Jones Industrial Average was off a little over -12 points, or -0.1 percent on the opening to 12,944, while the broader based indexes were also off marginally.  The Nasdaq Composite index opened -5 points or -0.2 percent lower to 2,944, while the S&P 500 index was off -3 points, or -0.3 percent to 1,360 after the opening.

At midday, the Dow its previous losses, with the Dow Jones Industrial Average trading down by -43 points or -0.3 percent to 12,922, while the S&P 500 was off  -6 points or -0.4 percent to 1,357, while the Nasdaq Composite Index dropped -15 points or -0.5 percent to 2,933.

The National Association of Realtors released U.S. Existing Home Sales this morning showing that sales of existing homes rose by +4.3 percent to a seasonally adjusted +4.57 million. The analyst consensus for the number was for +4.7 million existing home sales, nevertheless,  inventories for existing homes fell to a seven year low.

U.S. Stocks in the News

Dell Inc.(NASDAQ: DELL) stock was off -1.21 or -6.6 percent midday to $17.00 per share, after the world’s third largest PC maker reported fourth quarter net income had dropped -18 percent to $0.43 per share or $764 million, compared to net earnings of $927 million or $0.48 per share for the same period one year ago. The Round Rock, Texas firm also stated that revenue for the period which ends in April will decline -7 percent to $14.9 billion, versus the consensus of analysts polled by Bloomberg that expected $15.1 billion for first quarter revenue. Some analysts attribute the decline in Dell’s fortunes to competition from Apple Inc. on the high end of the market and competition from Acer and Lenovo Group Inc. on the low end. 

Apple Inc. (NASDAQ: AAPL) stock was down -1.71 or -0.34 percent midday to $513.10 per share, after the company faced Shenzhen Proview Technology in a Shanghai, China courtroom to defend its right to use the iPad trademark in mainland China. Proview is suing to stop Apple from using the name and   contends that Apple was never transferred the trademark rights for the name in mainland China. Proview’s lawyers also blame the success of the iPad for preventing their own product from succeeding in China. Cupertino, California based Apple Inc. claims that the iPad name was bought from Proview by Apple for 35,000 British Pounds or $55,000 back in 2001. Credit Suisse also raised its target price to $600 from $550, with little impact on trade.

Netflix (NASDAQ: NFLX) stock dropped -8.08 or -6.9 percent to $109.35 per share midday after Comcast (CMCSA) announced on Tuesday that it would be offering its own online streaming service. Philadelphia based Comcast announced it had already secured licensing deals for programming content with Sony Pictures, Disney ABC Television Group and NBCUniversal.  Other companies starting streaming services, which will compete with Netflix, include Amazon.com Inc. (NASDAQ: AMZN) who recently announced a deal with Viacom (VIA) that expanded Amazon’s streaming library by 15 percent.