U.S. Indexes Weak on Economic Data; LinkedIn IPO Soars 94%

Bikram Pandey
19 May, 2011
New York City

U.S. stocks fell after mind-Atlantic region showed weak manufacturing activity and existing home sales in April were weaker than expected. LinkedIn public offering soared on the first day of offering. French leaders worked behind the scenes to curtain the fallout from Dominique Strauss-Kahn scandal.

[R]12:30 PM New York – U.S. stocks declined after regional economic survey in mind-Atlantic region showed weak manufacturing activity and existing home sales in April were weaker than expected. LinkedIn public offering soared on the first day of offering. French leaders worked to curtain the fallout from the Dominique Strauss-Kahn scandal.[/R]

U.S. stocks lost early gains after a weak regional economic data and weaker existing home sales data. The indexes gained at the opening after jobless claims declined.

Seasonally adjusted weekly U.S. jobless claims decreased 29,000 to 409,000 from the revised previous week revised claims of 438,000.

The preliminary insured unemployment rate in the week ending May 7 unchanged from the prior week's unrevised rate of 3.0%.

The latest read of the mid-Atlantic region’s economy indicated manufacturing activity declined and existing home sales in April increased a fraction.

Seasonally adjusted annual rate for existing home sales in April edged up 0.8% to 5.05 million from downwardly revised 5.09 million units in March, and 12.9% below from a year ago of 5.80 million units rate in the month.

Glencore International Plc increased 2% on its first day of trading in London after it raised $10 billion in the initial public offering. The Switzerland based commodities trader raised its initial public offering price by 30% in the last one week of road show.

Dominique Strauss-Kahn resigned as head of the International Monetary Fund as he faces charges of attempted rape of a New York maid hotel and remains in custody in New York.

French leaders worked behind the scenes to restrict media coverage of the incident and also tried to install another French leader at the multilateral institution. China, Germany and India are also contending for the top position.

Japan reported economy in the fourth quarter to March fell 0.9% from the previous quarter and declined for the second quarter in a row. The GDP declined the same after adjusting for prices from the previous quarter.

Technically, Japan is in recession after the economy shrank for the second quarter in a row.

The economy declined annualized 3.7% and was the second largest fall after the economy shrank at 18.3% in the first quarter to March in 2009, according to the latest data from the Cabinet Office.

Stock Movers

LinkedIn Corp ((LNKD)) soared 94% to $87.40 on its first day of trading. The professional networking site sold 7.84 million shares at $45 each according to a company statement.

The company raised its offer price range to $42 to $45 a share from $32 to $35 a share and raised $352.8 million.

Advance Auto Parts Inc ((AAP)) declined as much as 9.7% to $64 after it reported first quarter earnings of $1.35 a share.

Big Lots Inc dropped 9% to $34.30 after the company failed to find a buyer according to two people familiar with the discussion between companies and its bankers.

GameStop Corp ((GME)) dropped 5% to $25.31 after it estimated second quarter net of 23 cents a share.

Toro Corp ((TTC)) increased 3.8% to $65.51 after the maker of lawnmowers increased its full-year earnings estimate to $3.60 a share.

Compagnie Financiere Richemont SA, the Switzerland based luxury goods maker reported results for the year ended March sales surged 33% to €6,892 million compared to €5,176 in the same period last year.

Profit for the year increased by 79 % to €1,079 million and earnings per share increased 79% to €1.925 on a diluted basis compared to € 603 million or €1.076 per share a year ago.