BWLD Buffalo Wild Wings, Inc. (delisted)

US markets advanced on Wednesday, but lingering doubts on the European front limited gains. Investors also opted to take a cautious stance and refrained from betting big bucks, choosing to wait for the ultimate outcome of Greece’s debt negotiations. There was a fair bit happening on the earnings front, but otherwise the day lacked any domestic action.

The Dow Jones Industrial Average (DJI) moved up by just 0.04% to settle at 12,883.95. The Standard & Poor 500 (S&P 500) edged up 0.2% to finish yesterday’s trading session at 1,349.96. The Nasdaq Composite Index gained 0.4% and closed at 2,915.86. The fear-gauge CBOE Volatility Index (VIX) moved up 2.9% to settle at 18.16. For 56% of the advancing shares on the New York Stock Exchange, 40% of the stocks were on the declining side. The remaining stocks were left unchanged.

Consolidated volumes on the New York Stock Exchange, the American Stock Exchange and Nasdaq, were once again low at 6.97 billion shares, well below last year's daily average of 7.84 billion. Since last week’s robust employment data, volumes have remained below average and thus trading has mostly been lackluster. This is primarily due to the absence of any significant domestic economic data and major news on the home front. More importantly, investors are refraining from placing their bets until Greece ultimately inks the debt deal.

For a considerable time now, Greece has been in the spotlight, starting with its bond swap deal with private creditors, which was rejected by euro-zone ministers. An impasse over this agreement then followed and eventually the Greek government resumed talks with its creditors. Thereafter, the European leaders, including the French and German leaders, laid out strict economic measures for Greece, which have to be adhered to if Greece wishes to receive the next tranche of its bailout package. Amidst these developments, while the nations’ politicians delayed from taking a stance, German Chancellor Angela Merkel said: “Time is running out”. These developments affected the markets’ modest swings and the overall sentiment received a boost on Wednesday following reports that Greece was close to inking a deal with private creditors. Greece's government is now preparing a list of economic measures that will qualify them for the next bailout payment.

Finally after three days of delays, Greek leaders gathered at Athens yesterday to brainstorm about the spending cuts they need to accept to qualify for financial aid. The parties were thus making an effort to strike a deal and clear the air about whether it will receive the crucial amount from international lenders. Reportedly, yesterday morning three major political parties, the conservative New Democracy, PASOK socialists and LAOS, were handed the 15-page document that detailed the principles of the bailout and its conditions.

Coming to the domestic arena, there were few if any economic reports which could affect market sentiment. However, some important earnings results were released.  After decent first quarter results from The Walt Disney Company (NYSE:DIS) on Tuesday, diversified media conglomerate Time Warner Inc. (NYSE:TWX) came out with better-than-expected fourth-quarter 2011 results and also hiked its dividend by 11%. However, shares of the company gained only 0.03%. Separately, Ralph Lauren (NYSE:RL) impressed with higher net income and revenue in its third quarter fiscal 2012. Subsequently, its shares gained 9.2%. Buffalo Wild Wings, Inc. (NASDAQ:BWLD) leapt 17.1% after reporting strong fourth quarter 2011 results, powered by strong top-line growth. However, telecom major Sprint Nextel’s (NYSE:S) drive of subsidized iPhones took a heavy toll on the company’s financials and its losses increased during the fourth quarter. The company managed to beat estimates but its shares dropped 1.6%.

 

 
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