Just when it appeared safe to start wading back into the water Greece had to go and remind investors that it is still a hurdle to overcome. Monday's losses, while nothing to get too worked up about, serve as a stark reminder that default for Greece is still a realistic option and the country is quite reluctant to go along with any of the solutions to its sovereign debt mess proposed by European policymakers. That about sums up the day as the three major U.S. suffered small losses and traded in fairly narrow ranges for most of the day.
Greek politicians were scheduled to meet today, but that meeting has been pushed back to Tuesday. Speaking of pushing, that is exactly what the Euro Zoneâ€™s big wigs such as France and Germany are doing with Greece. As in their pushing Greece to its end of the bargain on a $171 billion bailout fund. The problem with all of this is that the market has heard this noise before. One day it looks like there will be salvation for Greece, the next day, it is being pushed back and usually because Greece itself does not want to agree to whatever proposal is being set forth.
It is all very 2011 and just when it looked like the past of least resistance was higher, problems from across the Atlantic would provide the perfect excuse for some profit-taking in near-term. There was kind of sort of some good news regarding Portugal today. Press reports there picked up on a Goldman Sachs report that said the country could get another 30 billion to 50 billion euros in bailout funds that could help it stay out of the long-term bond market until the end of 2014.
Be advised, Portugal is no peach. When Moody's downgraded the country's credit rating to A1, it cited the governmentâ€™s weakening financial strength while saying the ''Portuguese economy's growth prospects are likely to remain relatively weak unless recent structural reforms bear fruit over the medium to longer term.''
Portugal Debt To GDP Chart
In stock-specific news, biotech firm Dendreon (DNDN), one of the more volatile names in a sector known for its volatility, surged almost 17% on volume that was better than triple the daily average after the FDA published a not too kind review of rival Amgen's (AMGN) drug for prostate cancer. Amgen is seeking approval for its injectable drug Xgev as a preventive measure for men with recurring prostate cancer, according to the Associated Press.
The FDA did not seem impressed, noting Xgev did not extend life. Bad news for Amgen, good news for Dendreon, which makes Provenge, a drug designed to bolster a patient's immune system against prostate cancer. Even with todayâ€™s big gain, Dendreon still has a long way to go to fill in that huge down gap that occurred last August.
Shares of health insurance provider Humana (HUM, $xx) slipped 5.4% despite the fact that the company raised its full-year 2012 outlook to $7.50-$7.70 a share from $7.40-$7.60. Analysts are expecting $7.99 a share. Humanaâ€™s fourth-quarter profit rose to $199 million, or $1.20 per share, from $107 million, or 63 cents per share, a year earlier. Revenue climbed 9% to $9.06 billion. EPS was in line with estimates, but analysts expected $9.24 billion in revenue.
Despite a day that had risk off way about it, beleaguered coal miner Alpha Natural Resources (ANR) enjoyed a strong volume gain of 3.3% and that came on news of production cuts announced last Friday. The company said it will halt production at four mines immediately and two more in 2013. Slack demand from electric utilities was the primary reason given for the output reductions.
Standard & Poor's Ratings Services said today that its 'BB' rating on Alpha Natural Resources would not be affected at the moment by the announcement. S&P said it expects Alpha Natural to to ''sell about 120 million tons of coal in 2012, including slightly more than 20 million tons of metallurgical coal, which is at the lower end of company-provided guidance of 119 million tons to 132 million tons.''
Alpha Natural Chart
After the bell, Anadarko Petroleum (APC), the largest U.S. independent oil and natural gas producer, reported a fourth-quarter loss of $358 million, or 72 cents a share.
''These results include certain items typically excluded by the investment community in published estimates. In total, these items decreased net income by approximately $781 million, or $1.57 per share (diluted) on an after-tax basis.Cash flow from operating activities in the fourth quarter of 2011 includes a $4 billion payment to settle the BP dispute. This resulted in negative cash flow from operating activities for the fourth quarter of $2.087 billion. Discretionary cash flow for the quarter totaled $1.752 billion,'' Anadarko said in a statement.
The company added it replaced 159% of production and that it achieved an 80% success rate in offshore exploration and appraisal drilling programs.
Shares of Anadarko were higher by 1.5% as of this writing in the after-hours session.
Looking at the charts, I have to apologize in advance because as was the case last Monday, the closing tallies today were so small that I cannot offer many new technical revelations compared to what Jim discussed over the weekend. Hopefully that will change and change for the better over the next week. A close at 1344 puts the S&P 500 well above support at 1325 and from here, the 1345-1350 range needs to be taken out before we can start having a conversation about resistance at 1370.
S&P 500 Chart
The Dow is still holding well above 12,800 with support being 12,700. There will probably be some round number resistance at 13,000, but more material resistance shows up around 14,000-14,100. Believe it or not, there are still a couple of earnings reports for the Dow to deal with as Coca-Cola (KO) reports before the bell tomorrow and Walt Disney (DIS) reports after. Good news from either might be an excuse to buy, but it probably will not ignite a huge Dow rally.
There are still some Nasdaq stocks left to report, but forgive me if I am not excited about Cisco Systems (CSCO) after the close Wednesday. I am willing to bet that any news tied to the Facebook IPO, whatever it may be, will move the Nasdaq more than Cisco's earnings and that is without knowing for certain that Facebook will even trade on the Nasdaq. Nasdaq support is 2800.
Obviously everyone knows that the Super Bowl was played yesterday and that the New York Giants won. Even if you are a Patriots fan, there is good news and it comes in the form of the S&P 500â€™s performance following a Super Bowl won by an NFC team. I will let this chart from Bespoke Investment Group do the talking.
Super Bowl Chart