Dow Sits Atop 12,000; Time for Caution? (UPS, BIDU, ADM, PRGO, UEC, PRXL)

Stocks had a very strong day, with the S&P busting through 1,300 and the Dow closing above 12,000, as the market recouped all its losses from Friday’s sell-off. Some strong earnings reports, a good ISM number, and a calmer Egypt all contributed to today’s rally. While we continue to believe things are looking up for the economy, we remain cautious on stocks in the near term given the strong run-up they’ve had over the past few months and the overall bullish sentiment that is out there.

The Uranium Stocks Index was the top performing tickerspy Index on the day, led by Uranium Energy (UEC) with a 10% gain. The Contract Research Outsourcing Stocks Index was the day’s worst performing tickerspy Index, with Parexel Internation (PRXL) down -10%.

Stocks climbed on the day, with the Dow rising 148 points to 12,040. The S&P jumped 21 points to 1,308, while the Nasdaq soared 51 points to 1,308. Oil fell -$1.42 to $90.77 a barrel, while gold rose $5.80 to $1,340.30 an ounce.

In economic news, the Institute for Supply Management said its January manufacturing index rose to 60.8% from 58.5% in December, the best reading in over six years. ISM said the employment index jumped to 61.7% in January from 58.9% in December while new orders increased to 67.8% from 62% in December.

In earnings news, United Parcel Service (UPS) shares rose 4.2% after the world’s largest package delivery firm said its fourth-quarter profit rose 48% to $1.12 billion, or $1.11 per share, from $757 million, or 75 cents a share, a year earlier. Revenue jumped 8% to $13.42 billion. Analysts were expecting a profit of $1.05 a share on revenue of $13.32 billion. For 2011, UPS expects its profits to rise 16%-22% to $4.12-$4.35 a share. Analysts were forecasting a profit of $4.19. Nearly 80 pros held UPS in their portfolios at the end of the third quarter, and almost 500 tickerspy members own the stock in their portfolios.

Shares of Baidu (BIDU), China’s largest provider of Internet search services, soared 9.3% after the company said its fourth-quarter earnings rose to $175.9 million, or 50 cents a share, on a split-adjusted basis, from $62.7 million, or $1.80 a share, a year earlier. Revenue rose to $371.3 million from $184.7 million. Analysts were expecting a profit of 45 cents a share on revenue of $360.3 million. The company said it expects first-quarter revenue of $360.6-$371.2 million, topping the consensus estimate of $354.2 million. Nearly 60 pros held Baidu in their portfolios at the end of the third quarter, and more than 2,130 tickerspy members own the stock in their portfolios.

Archer Daniels Midland (ADM) shares climbed 6.2% after the world’s largest grain processor said its fiscal second-quarter profit increased to $732 million, or $1.14 a share, from $567 million, or 88 cents a share, a year earlier. Excluding a one-time gain, ADM earned $1.07 a share, topping the 78-cent consensus. Operating profit surged 40% to $1.36 billion as sales rose 31% to $20.9 billion.

Shares of generic drugmaker Perrigo (PRGO) moved 1.8% higher after the company said it earned $90 million, or 97 cents a share, in the December quarter, compared with $60.8 million, or 65 cents a share, a year earlier. Profit from continuing operations was $1.05 a shares. Sales rose 23% to $718 million. Analysts were looking for EPS of 94 cents on revenue of $709 million. Michigan-based Perrigo said it expects a full-year adjusted profit of $3.75-$3.90 a share, which is above the consensus estimate of $3.69.

Tags: ADM, BIDU, PRGO, PRXL, UEC, UPS