Daily Wrap
DJIA -50.92 (-0.38%) to 13,384.29; S&P 500 -4.58 (-0.31%) to 1,461.89; NASDAQ -2.85 (-0.09%) to 3,098.81
The small 60 minute divergence we noted last week played out today with a small gap lower which then meandered most of the day before finally rallying after 2pm EST recovering about half of the day’s losses. The broad trend still seems to be strongly in-tact and right now it looks like that small divergence might just be setting up for a MACD recycle.
Stocks in the news today included Epocrates (EPOC), up over 21% after agreeing to be acquired by athenahealth (ATHN) for $11.75 per share in cash. Epocrates, Inc. creates point-of-care digital solutions that enhance the practice of medicine.
SolarCity (SCTY) was initiated with a few Buys today including one from Goldman Sachs with an $18 price target. Needham was on the low end with a Price Target of $17 and Roth Capital was on the high end at $22. New issues like this can often reach the higher target depending on how many shares are out, who holds them and lastly the market and sector. Being a solar name with the recent Buffet investment it could keep going. SCTY is not on the list as I cannot always list all the initiations as well but you can see that and other analyst notes at the Upgrades/Downgrades section.
Ten banks reach an $8.5 billion settlements/agreement with the Fed and Office of the Comptroller of the Currency. The funds are broken down into $3.3B direct payments to eligible borrowers and $5.2B in other assistance like loan modifications. This agreement includes Aurora, Bank of America (BAC), Citibank (C), JPMorgan Chase (JPM), MetLife Bank (MET), PNC (PNC), Sovereign, SunTrust (STI), U.S. Bank (USB), and Wells Fargo (WFC).
Shares of Achillion (ACHN) traded 10% lower after reporting interim results of an ongoing trial for their treatment for hepatitis C virus infection. Also on the downside today was ITT Educational (ESI) which lost over 18% on news it settled a lawsuit. Often stocks will rally when items like this are in the rear-view but Credit Suisse noted how this could hurt enrollment and pricing power.
There was nothing on our Event’s Calendar today but the rest of the week does have some announcements scheduled including some Fed-speak. As always you can visit the Event’s Calendar for the release of economic data, scheduled meetings and other news that could move the market.
The trend from 11/16/12 remains in place and will likely consolidate more but so far any dips continue to seem to be opportunities. When you step back and look at the 1 hour chart and today’s drop, it really puts into perspective how small it was.
