After The Close - The U.S. equity markets pressed notably higher today, as investors await the results of the U.S. Presidential Election. The market movement should not come as a big surprise as Election Day swings are not out of the ordinary. By the closing bell, the Dow Jones Industrial Average, the NASDAQ, and the S&P 500 Index had added 133, 12, and 11 points, respectively. The strong showing was rather broadbased, as the S&P Mid-Cap 400 Index and the small-cap Russell 2000 recorded similar percentage gains to the Dow and S&P. Overall, advancing issues led decliners by a comfortable margin on both the Big Board and the NASDAQ, to the tune of more than two-to-one on the former. 

Today’s buying on Wall Street was pretty encompassing, as each of the 10 major sectors finished the session in positive territory. Leadership came from those groups closely tied to the performance of the global economy, with energy, industrial, and basic materials stocks showing the most strength. The big movement in the oil markets comes as sentiment grows that the outcome of today’s Presidential Election could affect oil prices going forward. The prevailing thought on the Street is that a win for President Barack Obama will likely see continued aggressive monetary and fiscal policy, which would likely boost oil prices, while a Mitt Romney victory would lead to tighter monetary and fiscal policies and an increase in domestic production, causing oil prices to retreat. Crude oil prices jumped more than 3% on the New York Mercantile Exchange today.

Meantime, there was some noteworthy earnings news from Corporate America today—and the stocks of most of the companies to report did not fare well in the latest session. Of note, shares of luxury retailer Fossil (FOSL) fell after the company reported mixed results and lowered its revenue expectations for the fourth quarter. The stock of Zillow (Z) tumbled after the online real estate information provider lowered its guidance. Video game maker THQ (THQ) fell after the company beat expectations, but suspended guidance and announced that it had hired an outside consultant to assist the company in evaluating strategic and financing alternatives. Express Scripts (ESRX) also declined after the pharmacy benefits manager said that Wall Street’s forecasts for its 2013 results were too aggressive. On the positive side, shares of AOL (AOL) jumped after the Internet company beat expectations on both the top and bottom lines.

Elsewhere, trading overseas was mixed today. Overnight, Asia’s major indexes were lower ahead of the U.S. election and Thursday’s leadership change in China. Meanwhile, the major European bourses finished higher, despite some less-than-stellar economic news on the Continent. Specifically, the euro zone’s October non-manufacturing index reading came in lower than expected, pulled down by weakness in both Germany and France. Too, industrial production declined by 2.6% year over year in the United Kingdom last month. Perhaps, Europe’s investors were heartened by comments from European Commissioner for Economic and Monetary Affairs Olli Rehn that he believes a recovery in the euro zone will start in 2013 and accelerate in 2014.

Looking ahead to tomorrow, trading on Wall Street is likely to be driven, in large part, by the outcome of today’s Presidential Election. Investors should also note that more than 50 companies are expected to release earnings results after the close of trading this afternoon. Among the notable companies expected to report results before trading commences on these shores tomorrow are News Corp (NWSA), Macy’s (M), WellPoint (WLP), and Time Warner (TWX).   - William G. Ferguson

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.


12:30 PM EST - The U.S. stock market advanced moderately this morning, but is making a push higher as we pass the noon hour in New York. The Dow Jones Industrial Average is up 160 points (1.2%); the broader S&P 500 Index is ahead by 14 points (1.0%); and the tech-heavy NASDAQ is tacking on 20 points (0.7%). Market breadth shows strong support for equities, as advancing stocks are well ahead of decliners on the NYSE. All the major market sectors are participating in the up move. There is leadership in the conglomerates, capital goods, basic materials, and energy names. This is good to see, as these sectors have led the market higher over the past few years.  In more recent weeks, we have seen strength in the consumer stocks, as well, which also likely suggests that the economic recovery is taking hold. In contrast, there is some relative underperformance in the defensive utilities and healthcare issues. This could be expected, as traders turn more aggressive and seek out riskier stocks.

The improved sentiment can be seen in other areas, as well. Oil, which is an economic indicator, is up about 1% today. Investors are selling Treasuries, driving the yield on the 10-year note up to 1.71%. The VIX is dropping about 5% to just about 17, which confirms a bullish sentiment. 

Elsewhere, there were no economic releases issued today. Investors may instead be taking their cue from the voting stations, as the nation is electing its President and members of Congress. This election is important on many fronts, the least of which is the “fiscal cliff” that the nation is facing. The pollsters have predicted a tight race, and that may spell some confusion as to the outcome. However, a more decisive victory for either candidate makes the situation immediately resolved.

Technically, the S&P 500 Index has been bouncing around in a choppy range for the past few days. The hurricane on the East Coast, and the election, no doubt, add to the uncertainty and probably the market volatility, too. 

Meanwhile, the third-quarter earnings reports are still coming out. Today, we heard from Express Scripts (ESRX). That issue is off sharply, on concerns about the year-ahead outlook. Fossil (FOSL) stock is moving lower on a disappointing report, as well.  Also, shares of Zillow (Z) are sinking after the online real estate company issued a weaker-than-expected outlook.  - Adam Rosner

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.


Stocks to Watch from The Survey The nation’s attention is surely focused on today’s Presidential election, but there is some corporate news to keep an eye on. In the cable, Internet, and media space, Dish Network (DISH) and Cablevision (CVC) posted disappointing quarterly numbers, while shares of AOL Inc. (AOL) are indicating a modestly higher opening this morning. There are some mixed results out of the pharmacy services industry, as well. Investors appeared pleased with quarterly financials from CVS Caremark (CVS), as that stock is up in pre-market trading. However, shares of industry peer Express Scripts (ESRX) are down sharply ahead of the opening bell, after management said that investors’ expectations were too aggressive.

It’s looking good for the office equipment and supplies industry, as investors seem to be pleased with quarterly reports from Office Depot (ODP) and OfficeMax (OMX). Both stocks are indicating nicely higher openings this morning.

In other earnings-related news, shares of Fossil (FOSL) are down sharply in the premarket, after the watch and accessories company disappointed investors with its forward-looking guidance. – Matthew E. Spencer

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.


Before The Bell -  Election Day is here. Indeed, after what seemed like too many months of nonstop adds on TV, radio, the newspapars, and on-line, this day has finally arrived. It is now up to us to make up our minds and go to the polls to exercise a right that is given to all of us in this country, but is, unfortunately, still not universal on a global scale--even at this late date--now well into the 21st Century. 

As for Wall Street, it moved relatively little yesterday, but what change did take place was largely to the upside, as some late buying helped put the major averages comfortably, if still modestly, in the profit column. The indecision by traders seems, according to most polls, to reflect the indecision among voters at this late date. In all yesterday, the Dow Jones Industrial Average added 19 points; the NASDAQ pushed ahead by 18 points; and the Standard and Poor's 500 Index rose by three points. All told, there were slightly more gaining issues on the Big Board than declining stocks, while the plurality on the NASDAQ was more formidable, with a roughly three-to-two advantage for winning equities.

Aside from the election, investors were still focused on corporate earnings, although the lion's share, and then some, of third-quarter reports are already in the books. We will soon have a new round of reports, but largely from the retail group, which typically ends its third quarter in late October. As for the recent spate of reports, they have been mixed, with Wall Street less uniformly happy than during most previous quarters over the past four years. 

As for the economy, there was just one report of note released yesterday, as the Institute for Supply Management, the Tempe, Arizona-based trade group issued data showing that non-manufacturing activity rose in October for the 34th consecutive month, registering a reading of 54.2. True, that was a bit less than forecast, and nominally below the September reading. But it was exactly in line with the average for the past 12 months, and was more than four points above the 50.0 level dividing an expanding services sector from one that is contracting. It should be noted that this sector of the economy typically accounts for some two-thirds of the nation's gross domestic product. So, it is a critical measurement of sentiment.  

As for the economy, it has been advancing at a pedestrian clip, but one that has been slowly improving. To wit, the third quarter saw GDP growth of 2.0%. That was better than the April-through-June period, and looked to have been the model for the current quarter. Then, Hurricane Sandy moved its way up the East Coast and the tragic destruction brought on by that monster storm is likely to exact a major toll on the present three months, most likely clipping between 0.5% and 0.8% from GDP in the period, likely moving the presumptive rate of business expansion into the 1.2%-1.5% range. Some of this lost business should be made up in 2013, but not all of it, and in certain respects, some of the losses can never be made up.

As for the day ahead, traders will have one eye focused on the election and one on the movement by stocks, which at this early hour seems likely to be to the upside, with the equity futures posting solid gains following a better session overnight and early this morning in Europe.   - Harvey S. Katz

At the time of this article's writing, the author did not have positions in any of the companies mentioned.