Stock Futures Point to a Rebound. Stocks to Watch: AAPL, BAC, CCL, DRI, FB, MNST, NAV, R, WYNN
Published on Friday, 22 June 2012 07:51 Written by Todd Shriber
New York, June 22nd (TradersHuddle.com) – Stock futures were pointing to a higher open as Wall Street seems poised to stage a rebound from its second worst single-session drop this year. Participants were shrugging off a Moody’s downgrade of major global banks, after falling sharply in the prior session amid global economic slowdown fears following a string of weak data around the world.
In Asia, stocks fell following Wall Street lead amid worries over growth and a long expected credit downgrade of 15 of the world’s biggest banks. Weak manufacturing data points in Europe, China, and the U.S. signaled a slowdown in the global economy. The Nikkei lost 0.29%, while markets in China were closed for a public holiday.
In Europe, markets were extending their losses from the prior session after the Moody’s downgrade of major global banks, a weaker than expected German business sentiment, and as growth worries continue to hamper appetite for risk. However, the Moody’s downgrade was not having much of an impact of banking shares, which were moving higher. The downgrade was long expected, as the credit rating agency said that it was analyzing the banks since February.
The euro was adding against the Dollar, but trading above the $1.25 level. Crude oil was climbing 0.59% to $78.66 per barrel. Also in the energy complex, natural gas was jumping 0.85% to $2.604 per MMBtu. Gold was gaining 0.26% to $1569.60 an ounce, and silver was sliding 0.01% to $26.835 an ounce. Meanwhile, copper was retreating 0.45%.
Today’s Stocks to watch: Apple (NASDAQ: AAPL), Bank of America (NYSE: BAC) Carnival (NYSE: CCL), Darden Restaurants (NYSE: DRI), Facebook (NASDAQ: FB), Monster Beverage (NASDAQ: MNST), Navistar International (NYSE: NAV), Ryder System (NYSE: R), and Wynn Resorts (NASDAQ: WYNN).
Apple (NASDAQ: AAPL), the maker of iPads and iPhones, was adding 0.11% to $578.30 in pre-market, as the stock rebounds from the losses in the prior session, in which the stock was able to close above its 50day moving average at $576.16, which now is providing support. Yesterday, Jefferies reiterated its Buy rating and its target price of $800. According to and analyst at Nomura, Microsoft is considering launching its own smartphone, after the company unveiled earlier this week its Surface tablet.
Bank of America (NYSE: BAC) was jumping 1.66% to $7.95 in pre-market, rebounding from its nearly 4% loss in the prior session, despite getting downgraded by Moody’s. The downgrade was likely already priced in, since it the possibility of it was announced back in February. Famed banking analyst Dick Bove called the downgrade absurd. Bove said that balance sheets of banks have improved dramatically in the last 4 years and the industry could withstand a “moderate” downturn and even a severe recession as shown by the stress tests at the beginning of the year. Technically, BofA closed just above its 50day moving average at $7.78, which is providing support.
Carnival (NYSE: CCL), the cruise line operator, was falling 0.35% in pre-market. The company is scheduled to report its quarterly results later this morning. On average analysts expect a profit of $0.08 per share on revenues of $3.55 billion. Last quarter, the company posted a 125% upside earnings surprise as it earned $0.02 per share.
Darden Restaurants (NYSE: DRI), the owner and operator of the Red Lobster and Olive Garden restaurant chains, was losing 3.27% to $48.74 in pre-market on early reaction to its quarterly results. The company reported earnings that were inline with consensus on revenues that missed expectations. Also, Darden issued downside guidance for fiscal 2013, while it increased its quarterly dividend by 16% to $0.50 per share. The company earned $1.15 per share on revenues that climbed 4% from a year ago to $2.07 billion.
Facebook (NASDAQ: FB), the social media Company, was climbing 0.60% to $32.03 in pre-market, extending its gain from the prior session, in which the stock outperformed and shrug-off broad weakness. Facebook is trading above the $32 level after receiving mixed analysts’ reviews. Argus initiated coverage on the stock with a Hold, but Nomura initiated its coverage with a Buy.
Monster Beverage (NASDAQ: MNST), the alternative beverage maker, was jumping nearly 3% to $76.97 after S&P announced that Monster would replace Sara Lee (NYSE: SLE) in the S&P 500 Index. The post spin Sara Lee stub, which will be renamed The Hillshire Brands Co. (HSH), will replace Monster Beverage in the S&P MidCap 400 index after the close of trading on June 28th.
Navistar International (NYSE: NAV), the maker of medium and heavy-duty trucks, will be in focus after a Bloomberg report that discusses the company as a potential takeover target, as activist investor Carl Icahn, which controls 11.9% of the company shares, attempts to boost valuation.
Ryder System (NYSE: R), the transportation management solutions provider, will be in focus after slumping more than 8% in after hours. The company lowered its earnings guidance for fiscal second quarter below consensus, and fiscal 2012 below consensus. Ryder said that earnings have been adversely impacted by lower than expected results in its Fleet Management Solutions business segment
Wynn Resorts (NASDAQ: WYNN), the luxury casino operator, was climbing 0.14% to $102.19 in pre-market. The company won a court decision that takes its legal battle with Japanese billionaire Kazuo Okada back to Nevada state court.
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