Stocks are steady with the major indexes currently unchanged or showing fractional gains with the Dow Industrials (INDU) 8,899 +0.02% holding near the 8,900, the broader S&P 500 Index (SPX.X) 969 +0.23% up 2 points and tech-heavy NASDAQ-100 Index (NDX.X) 1,188.80 +0.3% holding a 4-point gain after a morning low of 1,180.01.
The major indexes reflect sector action, which seen the bulk of sector trade red in the early going, but now taking on a rather mixed look with the Drug Index (DRG.X) 317.29 +1.31% this morning's current sector winner with Pfizer (NYSE:PFE) $31.67 +2.12% and Glaxo SmithKline (NYSE:GSK) $40.99 +2.42% providing gains.
In a filing with the SEC, GSK said it has recently repurchased 2.4 million ordinary shares in the past two trading sessions (1.2 million on Friday and 1.2 million Monday). The stock purchased by GSK was cancelled. Today's gains in GSK most likely come on fundamental thought that the lesser number of shares outstanding (5.9 billion) should have a more positive impact on earnings per share.
The "Big 3" automakers General Motors (NYSE:GM) $35.87 -1.32%, Ford (NYSE:F) $10.91 -1.4% and DaimlerChrysler (NYSE:DCX) $31.37 -1.22% all trade weak just ahead of today's release of May auto/truck sales. Last Thursday, UBS Warburg said that while Chapter 11 for the "Big 3" automakers isn't imminent, it isn't out of the question either. UBS said it believes the Big 3 are heavily-leveraged, and thinks that industry trends will result in a major casualty at some point in the longer-term and that the lack of a short-term catalyst will provide ample time for the company's to further destroy shareholder value. UBS rated Ford (F) and DaimlerChrysler (DCX) as "reduce," and General Motors (GM) as "neutral."
Yesterday, Ford (F) traded a 6-month high, while today's trade finds DaimlerChrysler (DCX) slipping below both its 21-day and 50-day SMA's of $31.48. My (Jeff Bailey) thinking here is that DaimlerChrysler (DCX) is based out of Germany and may be negatively impacted by the weakness in the U.S. dollar, which must be converted back to euro when earnings are reported.
Sector losers in this morning's trade is limited with Oil Service (OSX.X) 95.96 -1.82%, Biotechnology Index (BTK.X) 450.53 -1.04% and Forest/Paper Index (FPP.X) 293 -1% the only sectors I see in falling more than 1% in today's trade.
After a gap lower at $84.32 at the opening of today's trade on news of an SEC investigation, Dow component Intl. Business Machines (NYSE:IBM) 84.07 -3.67% are the third-most actively traded stock on the NYSE at just over 11.7 million shares traded.