Stock Market News for November 21, 2012


Federal Reserve Chairman Ben Bernanke’s statement that the central bank does not have tools to combat the impending “fiscal cliff” dilemma ended benchmarks’ two-day rally. Moreover, a report from the American Petroleum Institute showed crude oil supplies have dropped in the previous week. Hewlett-Packard reported a dismal fourth-quarter performance. The company also said $5 billion has been charged due to “accounting improprieties”. These factors impacted the energy and technology sectors, respectively. However, the housing sector enjoyed decent gains after data suggested that housing starts increased in October.

The Dow Jones Industrial Average (:DJI) slipped 0.1% to close the day at 12,788.51. The Standard & Poor 500 (S&P 500) rose 0.1% to finish yesterday’s trading session at 1,387.82. The tech-laden Nasdaq Composite Index gained 0.02% to end at 2,916.68. The fear-gauge CBOE Volatility Index (:VIX) dropped 1.1% to settle at 15.08. Consolidated volumes on the New York Stock Exchange, American Stock Exchange and Nasdaq were roughly 5.6 billion shares, significantly lower than the year-on-year daily average of 6.5 billion shares. Advancing stocks outpaced decliners on the NYSE; as for 54% stocks that rose, 41% stocks moved lower.

Benchmarks ended flat on Tuesday after rallying for two consecutive days, propelled by optimism about positive developments regarding the fiscal cliff. The Dow had surged 207 points on Monday and registered its best day in two months. However, the blue-chip index fell as much as 94 points yesterday after Federal Reserve Chairman Ben Bernanke made a discouraging comment about the impending fiscal cliff.     

Speaking to the Economic Club of New York, Ben Bernanke said that the central bank is not ready to shield against the impending fiscal cliff if Congress fails to reach a deal to avoid it. He said: “If the economy goes off the broad fiscal cliff, I don't think the Fed has the tools to offset that”. According to market experts, the fiscal cliff need to be resolved or else it will dent the growth of the economy and could possibly result in another recession. “So it's important for Congress to address the fiscal issues soon,” Bernanke added.

Ben Bernanke also said: “We’re going to do what we can to support ongoing recovery in growth and jobs and create the demand for output, the demand for firms’ products that will remove that uncertainty about the future sustainability of the recovery”.

Meanwhile, the U.S. Census Bureau and the Department of Housing and Urban Development jointly announced that building permits decreased in October by 24,000 to a seasonally adjusted annual rate of 866,000 from revised September figures of 890,000. Building permits surged 29.8% from October 2011. However, the report mentioned that housing starts increased 3.6% to a seasonally adjusted annual rate of 894,000 in October from September’s revised figure of 863,000. This was below consensus estimates of 840,000.

On Monday, the National Association of Realtors had reported a 2.1% increase in existing home sales in October. Thus, positive housing starts data came at the right time and helped housing stocks to continue their winning momentum. The SPDR S&P Homebuilders (XHB) surged 2.1%. Stocks such as The Home Depot, Inc. (NYSE:HD), Toll Brothers Inc (NYSE:TOL), Meritage Homes Corporation (NYSE:MTH), PulteGroup, Inc. (NYSE:PHM) and Lowe's Companies, Inc. (NYSE:LOW) jumped 0.8%, 2.9%, 2.6%, 5.4% and 1.4%, respectively.

Coming to corporate results, Hewlett-Packard Company’s (NYSE:HPQ) shares plunged 12.0% after the company reported a fourth-quarter loss after including accounting charges. Company CEO Meg Whitman said $5 billion has been charged due to “serious accounting improprieties” related to its acquisition of software company Autonomy. HP’s market value has come down to $23 billion from $100 billion a couple of years ago. Best Buy Co., Inc. (NYSE:BBY) tumbled 13.0% after it reported a third-quarter net loss of $13 million.

Hewlett-Packard’s quarterly results affected the technology sector and the Technology SPDR (XLK) lost 0.4%. Stocks such as Apple Inc. (NASDAQ:AAPL), SanDisk Corporation (NASDAQ:SNDK), Microsoft Corporation (NASDAQ:MSFT) and Super Micro Computer, Inc. (NASDAQ:SMCI) lost 0.9%, 1.2%, 0.1% and 1.3%, respectively.

On the international front, Moody downgraded France to Aa1 from AAA. The agency indicated that this was due to an ambiguous fiscal outlook arising out of gloomy economy conditions. French finance minister Pierre Moscovic expressed his disappointment with the agency’s decision.

Read the analyst report on HD

Read the analyst report on TOL

Read the analyst report on MTH

Read the analyst report on PHM

Read the analyst report on LOW

Read the analyst report on HPQ

Read the analyst report on BBY

Read the analyst report on AAPL

Read the analyst report on SNDK

Read the analyst report on MSFT

Read the analyst report on SMCI

Zacks Investment Research

More From


View Comments (0)

Recommended for You

  • Tycoon buys 30 Rolls-Royces for Macau hotel

    A Hong Kong tycoon has placed the biggest ever order for Rolls-Royce cars, agreeing to buy 30 Phantoms to chauffeur guests at a luxury resort he's building in the global gambling capital of Macau. Stephen Hung's $20 million purchase surpasses the 14 Phantoms bought by Hong Kong's Peninsula Hotel in…

    Associated Press
  • 1 Tip To Lose Belly Fat

    It's Hollywood's Hottest Diet And Gets Rid Of Stubborn Fat Areas Like Nothing Else.

  • Before You Buy Alibaba, Check Out 4 Top China Stocks

    Before You Buy Alibaba, Check Out 4 Top China Stocks While investors gear up for Alibaba Group 's (BABA) hotly anticipated initial public offering, don't forget about other Chinese stocks that are worth keeping an eye on. Today's Young Guns Screen of

    Investor's Business Daily
  • Only 4 states will see cuts to food stamps

    Cuts to the nation's food stamp program enacted this year are only affecting four states, far from the sweeping overhaul that Republicans had pushed, an Associated Press review has found. As a result, it's unclear whether the law will realize the estimated $8.6 billion in savings over 10 years that…

    Associated Press
  • "The Retiree Next Door": How successful retirees stretch their savings

    "The Retiree Next Door": How successful retirees stretch their savingsBy the time she hit her late 40s, Toni Eugenia wasn’t sure she would ever be able to retire. Eugenia, 56, a pharmacy technician who lived in Houston, was nearly $200,000 in debt and

    Yahoo Finance58 mins ago
  • SHOE COMPANY: Our CEO Just Disappeared And Most Of The Money Is Gone

    "and like that: he's gone." This is an actual headline from a company press release: "CEO and COO disappeared, most of the company's cash missing." (Via FastFT) In a statement, German-based shoe company Ultrasonic said its CFO,  Chi Kwong Clifford Chan, has been unable to reach the company's CEO,…

    Business Insider
  • Apple to unveil new iPads, operating system on Oct. 21 : report

    The company plans to unveil the sixth generation of its iPad and the third edition of the iPad mini, as well as its operating system OS X Yosemite, which has undergone a complete visual overhaul, the Internet news website said. Trudy Muller, a spokeswoman for Apple, declined to comment. The iPad is…

  • Margaritaville casino owners seek bankruptcy

    The owner of Biloxi's Margaritaville casino has filed for Chapter 11 bankruptcy protection Tuesday, only hours before a hearing where the landlord aimed to seize the property. The filing by MVB Holding LLC in U.S. Don Dornan, a lawyer for landlord Clay Point LLC, said the company had planned to ask…

    Associated Press
  • Wondering How You Could Save on Home Insurance?

    Get a quote from Farmers Insurance and discover how you could save. Speak with an agent to get the knowledge you need to make an informed decision.

    AdChoicesFarmers InsuranceSponsored
  • Here's What Mark Cuban Wishes He Knew About Money In His 20s

    Cuban is the owner of the Dallas Mavericks basketball team. Billionaire investor and entrepreneur Mark Cuban is generous with his advice. When we asked him what he wishes he'd known about money in his 20s, he said:

    Business Insider
  • Embraer to sell 50 E-175 jets to Republic in $2.1 billion deal

    Brazil's Embraer SA, the world's third largest commercial planemaker, said on Wednesday it booked a firm order from U.S. The deal, which will be included in Embraer's order book for the third quarter, is valued at $2.1 billion, the planemaker said in a securities filing. The planes will be operated…

  • Play

    Citi, Bank of America Offer Discounted Mortgages

    Citigroup and Bank of America will offer mortgages at discounted interest rates to help borrowers with low incomes or subprime credit. AnnaMaria Andriotis joins MoneyBeat. Photo: Getty.

    WSJ Live
  • Gold loses luster on Fed; Barclays cuts forecast

    Barclays cuts gold forecasts, sees increasingly bearish backdrop Bloomberg MA MB MC MD ME SAN FRANCISCO (MarketWatch) — Gold prices dipped Wednesday on concerns about a stronger dollar ahead of the Federal Reserve policy statement and in response to Barclays lowering its gold forecast.

  • Fed renews zero rate pledge, but hints at steeper rate hike path

    The Federal Reserve on Wednesday renewed its pledge to keep interest rates near zero for a "considerable time," but also indicated it could raise borrowing costs faster than expected when it starts moving. In a statement after a two-day meeting of its policy-setting Federal Open Market Committee,…

  • Top Analyst Upgrades and Downgrades: AEP, BHP, GE, Incyte, 3M, Tyco, Under Armour and More

    Top Analyst Upgrades and Downgrades: AEP, BHP, GE, Incyte, 3M, Tyco, Under Armour and More Stocks were firm on Wednesday morning ahead of the FOMC meeting outcome. Tuesday’s rally may have sparked higher interest again, and investors are looking for bargains

    24/7 Wall St.
  • Best Womens Wrinkle Creams 2014

    Mom reveals simple wrinkle solution that has researchers very excited. Try this free solution today to look and feel years younger.

  • Billionaire Investor Says Chinese People Work Harder And Western Companies Could Face Deep Trouble After Alibaba IPO

    Michael Moritz, the chairman of VC firm Sequoia Capital, is a huge fan of Chinese internet companies and reiterated his enthusiasm for the Chinese market in an interview with The Wall Street Journal Wednesday. The billionaire investor described the Alibaba IPO as a “major landmark event” that is as…

    Business Insider
  • Boeing may have outfoxed Musk, but it could have bigger problems

    Elon Musk is arguably one of the greatest entrepreneurial minds of the 21st Century, but he was outsized an old school aerospace giant. Boeing won the bulk of NASA’s contract for a space taxi.  One of the other companies vying for the deal is SpaceX, the company headed by Tesla’s Musk, will get a…

    Talking Numbers
  • Play

    What the Fed Meeting Means for Bonds

    Janet Yellen & Co. are expected to hint at their timetable for raising interest rates. Here's how investors should prepare ahead of the meeting.

    WSJ Live
  • The Government Keeps Helping People Buy Failing Cold Stone Creamerys

    Would you loan someone money to buy a Cold Stone Creamery franchise if you knew that more than a quarter of those loans default? Over the last decade, franchisees in the Cold Stone Creamery ice cream chain defaulted on 29 percent of working-capital loans backed by the government, costing taxpayers…

  • Romney-Sized IRAs Scrutinized as Government Studies Taxes

    The preliminary report attaches data to an issue that drew attention during the 2012 presidential campaign, when Republican nominee Mitt Romney reported an IRA worth $20 million to $102 million. Senate Finance Committee Chairman Ron Wyden said many of these "massive" accounts come from deals…

  • Russian billionaire placed under house arrest

    A billionaire Russian tycoon was placed under house arrest Tuesday in a money-laundering case that has drawn comparisons with a government crackdown on Russia's Yukos oil company more than a decade ago. The Investigative Committee, Russia's top investigative agency, said that Vladimir Yevtushenkov,…

    Associated Press
  • Tired of Living Paycheck to Paycheck?

    New website reveals how to save $1,000's when you're living paycheck to paycheck. See exactly how.

    AdChoices Media ForceSponsored
  • Facebook Is Hiding Important Information From Investors

    Facebook Is Hiding Important Information From Investors On July 23, when Facebook reported its earnings for the second quarter, the company stunned everyone. Revenues were $2.68 billion, up 67% from the same quarter during the year

    Business Insider