Stocks drifted between small gains and losses Monday, with the major indices ending just in positive territory and most investors reluctant to stake out long positions in defensive trade ahead of the Federal Open Markets Committee policy-setting meeting later this week. Early declines were limited somewhat by bullish economic data and another flurry of deal-making although ongoing unrest in Iraq and Ukraine and the International Monetary Fund reducing it outlook for U.S. growth this year also weighed on equities.
IMF Downgrade
The IMF said on Monday the U.S. economy will likely grow about 2% this year, down from its earlier forecast for 2.8% growth. It blamed harsh winter weather and the resulting Q1 slowdown for the diminished outlook but said recent data suggest "a meaningful rebound is now underway," later adding "2015 should well exceed potential."
The World Bank last week similarly reduced its outlook for global and U.S. growth because of the winter downturn this year in large parts of the country.
Closer to home, the Federal Reserve Bank of New York reported Monday a surprise increase in its general business conditions index, climbing to a 19.28 reading this month from 19.01 in May and topping the market consensus looking for a decline to 15.
Industrial production also rebounded in May, the Fed said Monday, with activity at factories, mines and utilities climbing a seasonally adjusted 0.6% and reversing a 0.3% decline in April. April production was also revised higher from the 0.6% decline originally reported.
The National Association of Home Builders/Wells Fargo housing market index also rose to a 49 reading this month from 45 in May, beating estimates for a smaller rise to a 47 reading.
Crude Oil for July deliver settled $0.01 cent higher at $106.90 per barrel while July Natural Gas was down $0.03 at $4.71 per 1 million BTU. August Gold rose $1.20 to finish at $1.275.30 per ounce while July Silver added 7 cents, settling at $19.72 per share. July Copper climbed 2 cents to finish at $3.05 per share.
Monday's merger and acquisition activity was dominated by Medtronic's (NYSE:MDT) $42.9 billion offer for Covidien (NYSE:COV) in a combination of medical-device giants. Other deals involved a $7.3 billion offer for TW Telecom (NASDAQ:TWTC) by Level 3 Communications (NYSE:LVLT) along with SanDisk (NASDAQ:SNDK) bidding $1.1 billion for Fusion-io (NYSE:FIO) and Williams Companies (NYSE:WMB) looking to acquire a 50% stake of pipeline operator Access Midstream Partners for $6 billion.
Here's Where The U.S. Markets Stood At Day's End
- Dow Jones Industrial Average up 5.27 (+0.03%) to 16,781.01
- S&P 500 up 1.62 (+0.08%) to 1,937.78
- NASDAQ Composite Index up 10.45 (+0.24%) to 4,321.11
GLOBAL SENTIMENT
- Hang Seng Index down 0.08%
- Shanghai Composite Index up 0.74%
- FTSE 100 Index down 0.34%
UPSIDE MOVERS
- (+) WMB, Offers $6 billion to buy Global Infrastructure Partners' 50% stake in Access Midstream Partners LP (ACMP), along with 55.1 million limited partner units, increasing its overall stake in the pipeline company to 50%.
- (+) FIO, Agrees to $1.1 billion buyout proposal from SanDisk (SNDK), which is offering $11.25 a share for the data-storage firm.
- (+) BLUE, Reports positive results for its LentiGlobin experimental gene therapy, saying two patients with the beta-thalassemia blood disorder were able to stop blood transfusions after one LentiGlobin treatment.
DOWNSIDE MOVERS
- (-) KPTI, FDA Center for Veterinary Medicine offers only conditional support for the company's Verdinexor drug candidate to treat canine lymphoma.
- (-) DWA, "How to Train Your Dragon 2" sequel sells about $50 mln in tickets during its opening weekend, trailing estimates for a $65 mln box office.
- (-) LAYN, Reports 15.5% decline in fiscal Q1 revenue to $191.2 mln, lagging Street view by $15.4 mln. Net loss widens to $27.7 mln, or $1.41 per share, down from a $23.8 mln loss in the year-ago period and missing estimates looking for $0.35 loss.
After Hours Stock News From Midnight Trader.
Copyright © 2014 MT Newswires, a Division of MidnightTrader, Inc.