Closing Bell for Wednesday on Wall Street: Markets Start Higher, Track Higher by Close

June 26, 2013: U.S. equity markets opened higher this morning following the final reading on first quarter U.S. GDP growth, which came in lower than expected, but investors apparently believe that the slower growth will delay the Fed’s much-discussed tapering of asset purchases. Mortgage applications fell again this week as mortgage loan rates jumped to two-year highs. In Europe, French GDP was confirmed to have shrunk by 0.2% in the first quarter and German consumer confidence rose slightly. In Asia, China’s overnight lending rate continued to ease although it remains more than double the long-run average.

The U.S. dollar index is trading up 0.43% today, now at 82.9350. The GSCI commodity index is up 0.3% at 611.83. WTI crude oil closed up about 0.2% today, at $95.50 a barrel following the EIA’s weekly inventory report. Brent crude trades up 0.4% at $101.62 a barrel. Natural gas is up 1.7% today at about $3.71 per million BTUs. Gold for August delivery settled down 3.6% today at $1,229.80, the lowest close in nearly three years on the most active contract.

The unofficial closing bells put the DJIA up nearly 150 points to 14,909.99 (1.01%), the NASDAQ rose more than 28 points (0.85%) to 3,376.22, and the S&P 500 rose 0.96% or more than 15 points to 1,603.26.

There were a several analyst upgrades and downgrades today, including:

• Netgear Inc. (NASDAQ: NTGR) cut to ‘sell’ at Goldman Sachs;
• Silver Wheaton Corp. (NYSE: SLW) cut to ‘neutral’ from ‘outperform’ at Credit Suisse;
• ARM Holdings PLC (NASDAQ: ARMH) raised to ‘overweight’ at Piper Jaffray and to ‘buy’ at Benchmark;
• Pandora Media Inc. (NYSE: P) raised to ‘outperform’ with a price target of $22 at Cowen; and
• Google Inc. (NASDAQ: GOOG) started as ‘buy’ with a price target of $1,050 at Janney Capital.

Earnings reports since markets closed last night resulted in some price moves today, including these as of the last half hour of trading:

• Apollo Group Inc. (NASDAQ: APOL) is down 9.2% at $17.60;
• Smith & Wesson Holding Corp. (NASDAQ: SWHC) is down 2.1% at $9.78;
• General Mills Inc. (NYSE: GIS) is down 0.3% at $48.22; and
• Monsanto Co. (NYSE: MON) is down 0.2% at $101.15 after a weak forecast this morning.

Before markets open tomorrow morning we are scheduled to hear earnings from Bed, Bath & Beyond Inc. (NASDAQ: BBBY), Paychex Inc. (NASDAQ: PAYX), ConAgra Foods Inc. (NYSE: CAG), KB Home (NYSE: KBH), and Schnitzer Steel Industries Inc. (NASDAQ: SCHN).

Some standouts among heavily traded stocks today include:

Walter Energy Inc. (NYSE: WLT) is down 12.6% at $9.93 after posting a new 52-week low of $9.88 earlier today. The coal miner continues to struggle with low prices for its metallurgical (steelmaking) coal and a heavy debt-to-equity ratio.

Canadian Solar Inc. (NASDAQ: CSIQ) is up 14.9% at $10.26. The China-based solar maker signed a deal with a division of Samsung to open a new plant in Ontario.

Allied Nevada Gold Corp. (NYSEMKT: ANV) is down 9.3% at $5.64 after posting a new 52-week low of $5.60 earlier today. The gold miner — and most other stocks in the sector — are getting pounded as gold futures fall.

Stay tuned for Thursday. New York Fed President William Dudley, Fed Governor Jerome Powell, and Atlanta Fed President Dennis Lockhart are giving speeches. We have also noted the following events on the schedule (all times Eastern):

• 8:30 a.m. – New claims for unemployment benefits
• 8:30 a.m. – Personal income and outlays
• 10:00 a.m. – Pending home sales
• 10:30 a.m. – EIA weekly natural gas storage report
• 11:00 a.m. – Kansas City Fed manufacturing index
• 1:00 p.m. – 7-year note auction
• 3:00 p.m. – Farm prices
• 4:30 p.m. – Fed balance sheet and money supply