Monday December 26, 2016 – Friday December 30, 2016
On Monday, markets were closed for the Christmas holiday.
On Tuesday, the Case-Shiller home price index for October increased .6% month-over-month and 5.1% year-over-year. Consumer confidence for December soared 12.9 points to 113.7, its highest reading since August 2001. Ten-year treasury notes yielded 2.56%. Markets were up slightly, with the Nasdaq composite closing at a record high.
On Wednesday, the pending home sales index for November was down 2.5%, falling more than expected due to the recent jump in mortgage rates. U.S. crude settled at $54.06 a barrel, which was an 18 month high. Markets closed moderately lower on light trading.
On Thursday, the trade deficit in goods for November came in at $65.3 billion, with exports falling by 1% and imports gaining by 1.2%. Jobless claims for the week ending December 24th fell 10,000 to 265,000 and the EIA petroleum status report for the week ending December 23rd showed crude oil inventories increasing by 600,000 barrels. Also of interest was news that U.S. exports of gasoline and other refined products reached a record 8 million barrels last week. Markets remained mostly unchanged on light volume.
On Friday the Chicago Purchasing Manager’s index for December was 54.6, down 3 points and below estimates. Markets opened modestly lower on the last trading day of the year. Now let’s take a look at some stocks.
On Wednesday, Kate Spade & Company (NYSE: KATE) shares were halted due to a quick surge in volatility, followed by another surge and halt. The company then spiked over 15% when a Wells Fargo analyst claimed that various retailers are looking to make an acquisition. The analyst also stated that Kate Spade’s valuation is “compelling” since recent weak earnings reports have pushed share value south.
Shares of Toshiba Corp. fell 20% after the company announced that it may need to write-down billions of dollars due to its acquisition of U.S. nuclear power plant construction company Westinghouse Electric. The U.S. division was building the newest generation of reactors at two locations, and they fell massively behind schedule and billions of dollars over budget.
Shares of Qualcomm Incorporated (NASDAQ: QCOM) fell after South Korea’s antitrust agency fined the company $854 million for violating antitrust laws, saying the U.S. chip maker has an unfair business model with regards to its patent-licensing business and chip sales. The South Korean Fair Trade Commission said Wednesday that Qualcomm pressured rivals and mobile-phone makers into unfair deals, and also limited access of its essential patents to competing chipset makers such as Intel Corp and Samsung Electronics Co Ltd.
On Thursday, retail company Sears Holdings Corp. (NASDAQ: SHLD) secured a standby letter of credit for $200 million that will allow the company to fund its operations. The liquidity comes from affiliates of ESL Investments, the hedge fund operated by CEO Edward Lampert. CFO Jason Hollar said Sears will take actions to generate liquidity and adjust its capital structure. The company’s stock jumped over 5% on the news.