Stocks are mostly on the downside in mid-morning trading on Monday amid some caution ahead of this week’s slew of first-tier economic data leading up to Friday’s June jobs report. Meanwhile, the day’s consumer income and spending data has seen little market reaction.Before the opening bell, the Commerce Department said personal income increased by 0.4 percent in May following an upwardly revised 0.5 percent increase in April. Economists had expected income to increase by 0.5 percent compared to the 0.4 percent growth originally reported for the previous month.
At the same time, the Commerce Department said that personal spending edged up by 0.2 percent in May after increasing by less than 0.1 percent in the previous month. The modest increase in spending came in just above economists’ estimates for a 0.1 percent increase.
Further, the results of the G20 summit this past weekend have also been a non-moving event for stocks. A broad consensus on reducing government deficits by half before 2013 emerged, although additional details regarding the implementation of the measures have yet to be hammered out.
On the corporate front, BP Plc (BP) revealed its latest cleanup projection for the oil spill in the Gulf of Mexico is now $2.65 billion, an increase of $300 million from estimates released last week. The company is now in the process of drilling a relief well in its latest effort to curb the leaking oil.
Apple Inc. (AAPL) announced that it sold over 1.7 million of its iPhone 4 unit in just three days after its launch on June 24th. Apple CEO Steve Jobs was quoted as saying that the iPhone 4 is the firm’s “most successful product launch ever”.
Meanwhile, Honda Motor Co., Ltd. (HMC) said that its worldwide production for the month of May grew 42.8 percent from the prior year and reported an 18 percent increase in Japanese Domestic Market sales. Toyota Motor Corp. (TM) reported that its worldwide production jumped by 27 percent from the year-ago period.
The major averages have all seen choppy movement in recent dealing and are currently seeing modest losses. The Dow is down 1.21 points or less than 0.1 percent at 10,142.60, the Nasdaq is down 4.66 points or 0.2 percent at 2,218.82 and the S&P 500 is down 0.94 points or 0.1 percent at 1,075.82.
Sector NewsSteel stocks are some of the markets’ worst performers in the early going, contributing to a 1.4 percent slide by the NYSE Arca Steel Index. The drop has the index on target for a two and a half week closing low.
Natural gas, housing and commercial real estate stocks are also seeing notable weakness, although selling remains relatively tame.
Meanwhile, tobacco and gold stocks are posting strong gains, with the NYSE Arca Tobacco Index and the NYSE Arca Gold Bugs Index up by 1.7 percent and 1.4 percent, respectively. The tobacco index has climbed to a one-week intraday high and the gold index has reached a six-week intraday high.
Stocks Driven By Analyst Comments
Williams-Sonoma (WSM) is notably higher after being upgraded by analysts at Wells Fargo from Market Perform to Outperform. The stock has gained 2.1 percent, bouncing off of a three-month closing low set on Friday.
EastGroup (EGP) is also on the upside following an upgrade by Robert W. Baird from Neutral to Outperform. The broker also raised its target price on the stock from $38 to $40. Shares are currently up by 1.4 percent, setting a one-week intraday high.
On the other hand, MEMC Electronic (WFR) is trading lower after being rated as a new Sell at Goldman Sachs. The stock has lost 1 percent, setting a three week intraday low and heading back towards a five and a half-year low set earlier this month.
Other Markets
In overseas trading, stock markets across the Asia Pacific region closed mixed on Monday. Japan’s benchmark Nikkei 225 Index fell by 0.5 percent, while Hong Kong’s Hang Seng Index rose by 0.2 percent.
The major European markets have also turned mixed. The U.K.’s FTSE 100 Index is down by 0.4 percent, while the German DAX Index and the French CAC 40 Index are both up by 0.2 percent.
In the bond markets, treasuries are markedly higher amid this morning’s uncertainty. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, is trading at 3.050 percent, posting a loss of 6.3 basis points.
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