Market Wrap-up for July 10 – The Wild Week in Review

Chinese equity markets overshadowed the Greek austerity vote this week, with the Shanghai Composite falling 5.9% on Wednesday. Fresh concerns that the credit bubble has burst in China, sent investors heading for the exit. In an attempt to stave off a complete stock market meltdown, Chinese officials began implementing stabilization methods including the cutting of rates and ceasing all short selling and IPOs. Such a move helped support the market with a 4.55% rise in the index on Friday.

On the economic front, Consumer Credit and Trade Balance figures came in better than expected with a $41.9 billion trade deficit in May. Initial Claims however jumped considerably, with 297,000 new filings for the period. The market had estimated 276,000.

Greece’s decision to vote “‘No’ to creditors” terms on Sunday pushed the Dow Jones lower in early trade. Hopes of a deal and confirmation that the IMF would help the embattled nation, stabilized the equity markets later in the day. The S&P 500 finished the session 8 points (0.39%) lower. On the economic front, ISM Services figures for June came in at 56, which was in line with analysts’ expectations.

• Weight Watchers (WTW ) experienced a strong uplift on Monday, off the back of rumours that the company was a potential takeover target. WTW has a dividend yield of 18.52%.
• Humana (HUM ) rallied 2% on Monday with news that Health Insurer Aetna would be purchasing the company for $37 billion. HUM has a dividend yield of 0.59%.
• A.Schulman Inc (SHLM) reported worse than expected earnings on Monday with net sales touching $560.9 million. This is a 13% drop from the previous period. SHLM has a dividend yield of 2.02%.

China set the tone for the day, with investors reacting to slowdown fears and pushing the equity markets lower. The tech heavy Nasdaq was hit the hardest with a 1% decline for the day. In Brussels, leaders met at the Eurozone summit to discuss a proposal submitted by Greek Prime Minister Alexis Tsipras. Commenting on the situation, German Chancellor Merkel outlined that Greece only had a “matter of days” to agree to terms.

Wednesday became technical glitch day with the NYSE halting trade for more than three hours. Speculation that the exchange had been hacked were quashed by officials. Requesting a new three year rescue deal, Greece and the Eurozone confirmed that talks would go ahead to outline reform terms.

• Alcoa (AA ) reported Q2 EPS of 19c cents on Wednesday, falling short of analysts’ estimates of 23 cents. The company confirmed that the softening in the aluminium price had affected earnings. AA has a dividend yield of 1.13%.

Investors took a breath on Thursday, with the market opening higher before retreating in the afternoon. Finishing at 4922.40, the Nasdaq rose 12 points or 0.26%. On the macro front, Initial Claims disappointed with a considerable rise in filings for the period.

• Coty (COTY) announced to the market on Thursday that they would purchase Procter and Gamble’s 43 beauty brands in a deal worth $12.5 billion. COTY has a dividend yield of 0.69%.

The Dow Jones rose 1% in early trade on Friday with the market shrugging off monetary policy comments made by Fed Chief Yellen. The central banker confirmed that interest rates would shift in line with growth in 2015. No important economic data to report.

Earnings season is upon us and we will see reports from companies including: Bank of the Ozarks (OZRK), Codorus Valley Bancorp Inc (CVLY ), Marten Transport Ltd (MRTN ), Simulations Plus Inc (SLP), Westamerica Bancorp (WABC ), ADTRAN Inc (ADTN), Cardinal Financial Corp (CFNL), Central Valley Community Bancorp (CVCY ), Commerce Bancshares Inc (CBSH ), CSX Corp (CSX ), Fastenal Co (FAST ), First Community Corp (FCCO ), Healthcare Services Group Inc (HCSG), Johnson & Johnson (JNJ ), JP Morgan Chase (JPM ), Las Vegas Sands (LVS ), Rocky Mountain Chocolate Factory Inc (RMCF), Saratoga Investment Corp (SAR ), Wells Fargo (WFC ), Yum Brands (YUM ), American National Bankshares (AMNB ), BancFirst Corp (BANF ), Banco Latinoamericano de Comercio Exterior SA (BLX ), Bank of America (BAC ), Blackrock (BLK ), Boston Private Financial Holdings Inc (BPFH ), Cohen & Steers Inc (CNS ), Delta Airlines (DAL ), Seagate Technology (STX ), Associated Banc-Corp (ASB ), Blackstone Group LP (BX ), Goldman Sachs (GS ), Keycorp (KEY ), Philip Morris International Inc (PM ), Schlumberger (SLB ), Honeywell (HON ), General Electric (GE ), Autoliv Inc (ALV ), W.W.Grainger (GWW ).

Please note that this is a selection of companies.

The following economic data will also be released: the Treasury Budget on Monday; Retail Sales, Export & Import Prices on Tuesday; PPI, Fed Beige Book and Industrial Production on Wednesday; Initial Claims and Continuing Claims on Thursday; CPI, Building Permits, and Housing Starts on Friday.