Quiet open for stocks as with earnings reports offsetting positive news on the economic front. Housing starts and jobless claims were released this morning with both showing improvement. However, Oracle (ORCL) and FedEx (FDX) are moving lower following their earnings releases. AMR (AMR) another company in the news with the stock up sharply in premarket trading. The major market indices are looking for their ninth gain in the past 10 sessions.

Housing starts for August rose 1.5 percent to an annualized level of 0.598 million units. This was in line with expectations and the highest level since last November. Housing starts have seemed to bottom, but have a long ways to go to get back to normal. In fact, the year on year drop remains extremely high at a decline of 29.6 percent.

Jobless claims for the week ending Sept. 12 were expected to rise by 25,000, but actually fell by 5,000 claims to a level of 545,000. The four-week moving average is starting to decline, down 8,750 to 563,000. The hope is that the decline in jobless claims will lead to improvement in payrolls data. However, Fed Chairman Bernanke noted earlier this week that the economic recovery will be slow, especially in the jobs market.

FDX preannounced earnings earlier in the month, yet the stock is still seeing a decline following its earnings report. FDX shares are down about one percent in early trading after announcing revenues fell 27 percent. The stock is down even though the company announced it would raise rates by about 6 percent. It seems traders are selling into the news with the stock falling yesterday and today, although shares rallied following the preannouncement. FDX shares are trading near $77.50, more than double the stocks 52-week low of $34.02.

ORCL shares are down about three percent at a price near $21.50 Thursday morning. The company matched earnings estimates at 30-cents a share, but traders have not been pleased with revenue results, which fell 5.2 percent. The software company announced that new software license revenues fell 17 percent, also lower than anticipated.

AMR shares are seeing large gains this morning with the airline stock up 23 percent. The company announced it had secured $2.9 billion in additional liquidity. Despite higher fuel costs, airline stocks have rallied sharply this month with AMR up nearly 70 percent. The stock is trading above $9, nearly quadrupling from its 52-week low at $2.40.

Jody Osborne
Senior Staff Writer & Options Strategist
Optionetics.com ~ Your Options Education Site