Stock Market Today: This Stock's Dip Could Be Promising
By , Money Morning•
The stock market today opened flat as positive housing data was weighed down by somewhat mixed earnings.
Here's our market roundup and one stock that's soaring today.
Housing starts reach four-year high- The housing market continues to show signs of recovery as the rate of home building in September grew to levels not seen since July 2008. Housing starts rose to an annual pace of 872,000 homes, up 15% from August. Builders also filed for permits at an annual rate of 894,000 homes, up 11.6% from last month and 45.1% year-over-year. Demand for housing will continue to be helped by the Federal Reserve's pledge to keep interest rates near historic levels and the implementation of QE3. Housing prices have rebounded from their nadirs in part because foreclosures are at five-year lows and because the number of U.S. households grew 2% in 2011, its largest rise in 10 years. "There is going to be a continued housing recovery over the next few years," said Larry Seay, chief financial officer at Meritage Homes Corp. (NYSE: MTH) in Scottsdale, AZ, at an investor conference. "Pent-up demand that has built up from people deferring household formation is going to help buoy the recovery. High affordability not only with house prices being very low, but also interest rates being as low as they've been in decades, and all that translating into an improved buyer confidence."
Bank of America Corp (NYSE: BAC) delivers a mixed bag- Charlotte, NC-based Bank of America barley managed to squeeze out a profit for the third quarter after $1.6 billion in litigation charges ate away at its earnings. The financial giant earned $340 million - a little more than zero cents per share. That was better than analysts' average estimate of a loss of 7 cents per share, but well below last year's third-quarter profit of $6.2 billion, or 56 cents per share. Revenue also fell, slumping to $20.4 billion from $28.5 billion a year ago, missing expectations. A day after Citigroup CEO Vikram Pandit abruptly resigned, Bank of America's CEO Brian Moynihan sounded confident about his bank's future. "We are doing more business with our customers and clients, deposits are up, mortgage originations are up," he said. "Our strategy is taking hold even as we work through a challenging economy and continue to clean up legacy issues." BAC stock is up 0.6% in early trading.
Here's one stock that beat earnings and is poised for future success.
Abbott Laboratories (NYSE: ABT) beats earnings ahead of split- The drug and medical device company reported third-quarter net income of $1.9 billion, or $1.21 per share, up significantly from $303 million, or 19 cents per share a year ago. Excluding one-time items Abbott earned $1.30 per share, better than the $1.28 forecast. The company benefited from lowering its expenses but missed on revenue, sending the stock lower today. On the horizon for investors is the spinoff of its pharmaceutical business into AbbVie, which will focus solely on branded drugs, including the blockbuster anti-inflammatory drug Humira. "We will be listening for an update on timing of the upcoming split and for additional color on the company's pharma pipeline," Derrick Sung, an analyst at Sanford C. Bernstein & Co. in New York, said in an Oct. 12 note to clients. "The key for driving value on the pharma side will be if Humira growth can be sustained beyond 2015 and how much the pipeline can contribute." ABT stock is up 22% this year, but is down 4% today.
The Dow Jones was down 7 points, or 0.06%, and the S&P 500 was up 6.33 points, or 0.44% as of noon.