U.S. shares were sliding for a third day after initial jobless claims missed expectations amid losses in European markets.
Stocks fell Wednesday together with commodities. Resources and energy stocks dragged down the market amid disappointing domestic and European fiscal data. A report on durable goods in the U.S. saw a bounce in February, although one that was less than expected. The number of Americans filing for first-time unemployment benefits fell 5,000 to 359,000 for the week ended March 24 from a revised 364,000 from the preceding week. Economists anticipated claims to come in at 350,000 from an orginally documented 348,000.
Also Thursday, the government announced its third study on economic expansion in the fourth quarter of 2011. The Bureau of Economic Analysis’ third estimate on fourth-quarter GDP held steady at 3%, in line with expectations. The expansion rate is up from 1.8% annualized growth rate in the third quarter while still worrisome, in particular given that progress is expected to pull back heading into the first quarter of 2012. The rate of improvement is leveling out and while GDP was not revised the sub components were a bit better for the overall economy with increased final revenue and a downtick in the inventory contribution.
European stocks were down ahead of the meeting in Copenhagen on Friday where European governments will seek to increase the rescue firewall in the region. German Chancellor Angela Merkel is expected to allow the raise. The European Commission also said an index of executive and purchaser sentiment fell to a reading of 94.4 in March from a revised 94.5 in February. On Thursday, Germany’s DAX ended lower 1.77%, while London’s FTSE lost 1.1%. The Hong Kong Hang Seng closed down 1.32%, while the Nikkei Average in Japan finished lower by 0.67% overnight.
Stocks in the News:
Stifel Nicolaus raises its price target on Buy-rated Allergan (NYSE: AGN) from $90 to $110 on takeaways from the company’s R&D day suggesting future sources of growth.
Stifel Nicolaus says, ” The company laid out several near term opportunities with the release of positive Phase III data and filing in idiopathic OAB as the biggest surprise, which we believe will begin generating growth in the near term. Additionally, Allergan introduced a new bio-compatible surgical mesh, SeriScaffold, for launch in 2013. However, the most valuable programs, in our view, are the longer term investments the company has made in Botox for osteoarthritis (a new area), targeted toxin for neuropathic pain, anti-VEGF to treat the large markets of aged-related macular degeneration, and bimatoprost for hair loss. With the revenue potential of these programs, Allergan’s long-term growth is tangible and sustainable.”
AGN closed at $94.05 a share on Wednesday.
Pepsi Co Inc. (NYSE:PEP)the world’s second-largest food and beverage business, today announced that it and Tingyi Holding Corp., one of the leading food and beverage companies in China, have received all necessary regulatory and shareholder approvals required to complete their transaction to create a strategic beverage alliance in China, which is projected to become the world’s largest beverage market by 2015.
PEP closed at $65.93 a share on Wednesday