The S&P and Dow are lower at midday, though not by that much, while the Nasdaq is seeing a mild gain amid the continued cross-currents of optimism about the economic recovery and fear about the continued rise in coronavirus cases in the U.S. and now in China once again.
ECONOMIC EVENTS: In U.S. data, initial jobless claims fell 58,000 to 1.508M in the week ended June 13. The Philly Fed manufacturing index bounced 70.6 points to 27.5 in June, which was much better than expected. The leading economic indicator index bounced 2.8% to 99.8 in May.
TOP NEWS: Shares of Biogen (BIIB) are 6% lower near noon after a U.S. District Court ruled in favor of Mylan (MYL) and invalidated the company's Orange Book-listed patent that provided exclusivity into the 2028 timeframe for Tecfidera, Biogen's product approved by the FDA for use in the treatment of multiple sclerosis. Biogen, which has confirmed the unfavorable ruling, said it intends to appeal the court's decision.
Shares of Kroger (KR) are down 6% despite the grocer's report of same-store sales, excluding fuel, rising 19% in the first quarter. Kroger said that while it expects to exceed the outlook shared in its April 1 business update for identical sales without fuel, adjusted EPS and adjusted free cash flow, the company is not reaffirming or providing new 2020 guidance given the many unknown factors related to the long-term impact of COVID-19 that could influence its financial results for the remainder of 2020.
Additionally, shares of Carnival (CCL) are down 2.5% after the cruiseline operator's update. While Stifel analyst Steven Wieczynski said preliminary results for Q2 "are somewhat irrelevant at this point given the global pause in ship operations," he also said the company gave updates that provide some positives but also some negatives. While he added that the negatives appeared to outweigh the positives, Wieczynski said his Buy rating "remains firmly intact" and his price target remains $30 for Carnival shares. Separately, Berenberg analyst Stuart Gordon downgraded Carnival to Sell from Hold with a price target of $10, down from $14.50, calling the stock's valuation "highly unattractive" and the company's capital structure "unsustainable" and in need of an injection of new equity.
MAJOR MOVERS: Among the noteworthy gainers was Enphase Energy (ENPH), which rose 18% as analysts remained bullish on the shares following Prescience Point's negative research report on the stock. Also higher was ABM Industries (ABM), which gained 14% after reporting quarterly results.
Among the notable losers was U.S. Steel (X), which slid 12% after it announced an offering of 50M shares of common stock. Also lower was Hudson (HUD), which fell 3% after reporting quarterly results.
INDEXES: Near midday, the Dow was down 98.25, or 0.38%, to 26,021.36 , the Nasdaq was up 4.60, or 0.05%, to 9,915.13, and the S&P 500 was down 6.48, or 0.21%, to 3,107.01 .
