Dow-component Caterpillar continued to slide today after yesterday’s weak results, and that set the tone for the first few hours of trading New York, with both the Dow and the S&P 500 struggling to stay out of the red. Both indices pared their losses as the trading day wore on, though, with the Dow flat in early afternoon on Wall Street, while the S&P gained 0.09% or 1.4 points to 1687.4.
The NASDAQ gained though, helped by the soaring share price of Facebook, which posted its largest ever daily percentage, jumping as much as 28% at one point after posting stellar results for the last quarter.
A long list of brokers raised their price targets substantially today for the company, after the best set of results for Facebook since it went public. Second-quarter earnings were 19 cents per share, excluding items, which beat the Street’s estimate of 14 cents.
Revenue spiked 53% from the same quarter a year ago to $1.81 billion, boosted by the income from mobile ads. Mobile revenue is a hot topic for online providers such as Facebook, Google and Yahoo. Facebook showed it has got on top of the issue, growing mobile ad revenue to 41% of total advertising revenue in the second quarter from the 30% seen in the first quarter.
Facebook’s strong performance helped the NASDAQ rise 0.6% to 3059.
Macroeconomic data today held few clues as to where the Fed might be heading with its quantitative easing. Jobless claims came in at 343,000 for last week, up 7000 from the previous week, and slightly worse than expected. July’s data can be skewed more than a little by the fact that a lot of car manufacturers close their plants for annual maintenance at this time of year, so this particular report doesn’t significantly affect the picture when it comes to the employment situation.
A separate report showed durable goods orders increased faster than expected in June, but the headline rate of a 4.2% is perhaps a little misleading. Stripping out the notoriously volatile component of transportation left the number unchanged for June, and as a result, the market reaction to this report was somewhat muted.