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US stock market daily report (October 11, 2012, Thursday)

Contributed by Millennium Traders

Carl Icahn, activist investor, offered to buy the rest of Oshkosh Corp. (OSK) that he does not already own in a deal that values the heavy-duty vehicle maker at about $3 billion. Icahn, the largest shareholder of Oshkosh with a stake of nearly 10%, is offering $32.50 a share, a premium of roughly 21% over Wednesday's closing price. Oshkosh shares ended trading session on Thursday with a gain of 11%. Icahn said he intends to nominate a slate of candidates to its board. The offer increases speculation that Icahn will look to combine Oshkosh with truck maker Navistar International Corp. (NAV) where he recently gained board representation. "It is clear to me that management has taken a passive attitude to the future of this company, willing to sit back and watch what happens to the defense, housing and construction industries, hoping for a positive outcome and reduced competition," Mr. Icahn said. "I strongly believe that Oshkosh needs proactive shareholders to bring a proactive management team together to weather a volatile economy, a shrinking defense industry and a budget constrained municipal environment." Oshkosh advised shareholders to take no action while it reviews the offer and noted that Mr. Icahn was unsuccessful in his attempt to elect any of his six nominees to Oshkosh's board at its annual meeting. The company said it will advise shareholders of its position on Icahn proposal within 10 days from the date of commencement. Icahn's offer is conditioned on the election of his candidates to the board. Icahn is giving holders 45 days to tender their shares and suggested extensions are possible. Icahn plans to demand that the company's board move the annual shareholder meeting forward to move up the election vote and closing of the deal if 40.1% of Oshkosh shares are tendered.

U.S. stock indexes closed mostly unchanged on Thursday as excitement about a decline in jobless claims dissipated during the mostly lackluster trading session. The stall felt on Wall Street over the past few trading session is highly attributed to uncertainty ahead of the U.S. presidential election less than a month away. For the fourth day in a row, the Dow Jones Industrial Average (DJIA) ended the session lower - down on the day by 18.51 points or 0.1% to 13,326.46. The S&P 500 index (SPX) gained a fraction to end at 1,432.86 and the Nasdaq Composite (COMP) shed 2.40 points or 0.1% to 3,049.38.

The U.S. Labor Department reported Thursday, first-time jobless claims for state unemployment benefits fell unexpectedly lower in the week ending October 6, to their lowest level since mid-February - initial jobless claims fell 30,000 to 339,000. Four-week average fell 11,500 to 364,000 to strike the lowest level seen since late March. Jobless claims for previous week were revised by Labor Department with an increase of 6,000 to 369,000 compared with the initial estimate of a gain of 4,000 to 367,000.

The U.S. Commerce Department said Thursday, the U.S. trade deficit widened by 4.1% in August to $44.2 billion. Import prices rose by 1.1% during August, striking the second straight large gain due to a spike in imported oil prices. Fuel import prices rose 4.4% in September. Import prices excluding fuel rose a modest 0.2% in September after falling 0.2% in the prior month. Import prices over the past year remain down 0.6%. Fuel prices are up 40.9% for 2012 and non-fuel prices are up 5.4% over the past twelve months. During August exports saw their third straight monthly decline. The U.S. trade deficit per with China narrowed slightly to $28.7 billion in August compared with $29.0 billion in the same month last year, per Commerce Department.

On the Chicago Board of Trade Thursday corn futures rallied with December corn (CBC:CZ2) surging higher by 36 cents or 4.9% to $7.73 a bushel after the U.S. Department of Agriculture cut its estimates on production and beginning stocks for the 2012/2013 crop year. USDA cut its beginning stocks forecast for U.S. corn on Thursday by 193 million bushels, based on the September 1 stocks estimate and also lowered its U.S. corn production forecast by 21 million bushels.