After The Close - It was an uneven trading session on Wall Street today. This was not all that surprising, as absent any news on the economy, investors turned their attention to Corporate America, and the signals were mixed with regard to earnings. Both the bulls and the bears had some reports to cling to, but the hits and misses seemed counteract each other over the course of the day. One index where earnings clearly were a drag was the Dow Jones Industrial Average. The index of 30 bellwether companies was hurt by a notably poor showing from  IBM (IBM - Free IBM Stock Report), which fell on weaker-than-expected revenue results in the latest quarter. Conversely, shares of Boeing (BA - Free Boeing Stock Report) were the big winners among the Dow Industrials, with the aerospace giant helped by a good quarterly report from industry peer General Dynamics (GD).

Overall, the major averages made for a mixed reading. The S&P 500 Index finished the session not too far removed from the neutral line in positive territory, while the NASDAQ—which was helped by good showings from a few big technology stocks, including Apple (AAPL)—finished the day well into the plus column. Shares of the iPhone maker got a boost from a report that activist investor Carl Icahn is betting heavily on the technology behemoth, with a stake of now more than $3 billion in the company. In sum, when looking past the performances of the major market averages, there was a positive undertone to trading, with advancing issues finishing ahead of decliners on both the Big Board and the NASDAQ.

Much like yesterday, trading was driven by quarterly earnings. As we noted in our earlier market commentary, the latest batch of earnings reports brought some winners and losers. In addition to the aforementioned disappointing report from IBM, investors were not pleased with what they saw from Coach (COH). Sales of the retailer fell sharply on reports that same-store sales were off notably year over year last month. Conversely, shares of industrial giant United Technologies (UTXFree United Technologies Stock Report), moved slightly higher, as investors looked past a disappointing revenue showing, electing to concentrate on a bigger-than-expected bottom-line gain.

The United Technologies report, along with the aforementioned positive data from General Dynamics gave the industrial sector a boost today. There was some leadership from the industrial and energy stocks in the latest session, with the latter group helped by a jump in crude prices on the New York Mercantile Exchange. Meantime, there was some buying interest in the technology space, which helped the fortunes of the NASDAQ. One noteworthy move higher today and, for that matter, this week was made by shares of struggling tech company BlackBerry (BBRY). Shares of the smartphone maker were higher on reports that the company plans to sell of good deal of its Canadian real estate assets and that the Pentagon uses a good deal of BlackBerry phones to conduct its business. On the other hand, it was not a good day to be holding basic materials and, to a lesser extent, healthcare stocks. The precious metals issues were the big laggards in the basic materials group, hurt by declines in gold, silver, and copper prices today. In particular, the price of gold fell on a report that a major investment bank has lowered its year-ahead price target for the precious metal. 

Still, when looking at recent trading, particularly the intra-day movements of the 10 major sectors, there definitely seems to be some complacency in the equity markets right now. This is reflected in the recent low level of volatility in the market, with the S&P 500 Volatility Index (or VIX) trading in a historically low range thus far in 2014. Our sense is that the earnings results of Corporate America are failing to give investors—with a stock market where valuations are frothy—a reason to push equities much higher.

Indeed, of the 81 S&P 500 companies to report results, only 49 have beaten Wall Street’s lowered estimates, which is trailing the percentages seen in the last few quarters.  

Looking ahead to the final few days of this week, earnings will probably continue to be the big driver of trading, with a few more Dow 30 companies on the docket. That said, tomorrow also will bring some news on the economy, with data due on initial weekly jobless claims, existing home sales, and the leading indicators.  -William G. Ferguson

At the time of this article's writing, the author did not have positions in any of the companies mentioned.

12:15 PM EST - The stock market is putting in another mixed session today, as traders look for direction. At past noon in New York, the Dow Jones Industrial Average is off 37 points; the broader S&P 500 Index is up one point; but the technology-heavy NASDAQ, which is bucking the downtrend, is up 16 points. Market breadth suggests a divided market, too, as advancing issues are just about even with decliners today. Some of the major market sectors are in negative territory. There is some weakness in the basic materials issues, for example, while the healthcare stocks are also struggling a bit. However, strength can be found in the energy area. Notably, prices for both crude oil and natural gas are rising today, and that may be helping related equities. The utilities are also advancing, as investors may be adopting a less speculative attitude.

Technically, the market appears to be locked in a sideways trading range, which likely suggests that traders are looking for some guidance. So far, it seems that the fourth-quarter earnings season has not provided enough positive news to drive the averages notably higher. This is not surprising, as stocks may have gotten a bit expensive over the past few months, with most of the good news already factored in, we think. So for now, a sideways market may be the best case scenario.

As was the case yesterday, investors received little economic news. Tomorrow, things should be busier. The weekly initial jobless claims data likely will shed light on the employment situation. Also, existing home sales will give investors a look at the housing markets.

In corporate news, the earnings reports continue to flow in. Yesterday afternoon we heard from a number of key technology companies. Specifically, IBM (IBM - Free IBM Stock Report) stock is off, after the Dow component put out a mixed release. Cree (CREE) stock is up, after that company issued a solid report. Meantime, investors were not so pleased with the news from Advanced Micro Devices (AMD), and that issue is sharply lower.  This afternoon we will hear from eBay (EBAY) and Netflix (NFLX). So stay tuned. - Adam Rosner

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.


Stocks to Watch from The SurveyThe drumbeat of earnings news continues, with today’s session headlined by technology giant International Business Machines (IBMFree IBM Stock Report) and diversified manufacturer United Technologies (UTXFree United Technologies Stock Report), both of which are members of the Dow 30. Investors were not excited with either report, and both stocks are down moderately ahead of the bell, as a result, with IBM showing more weakness, likely due to a top-line miss.

The earnings news was mixed elsewhere. Shares of chipmakers Advanced Micro Devices (AMD) and Texas Instruments (TXN), leather goods retailer Coach (COH), mining concern Freeport-McMoRan (FCX), and financial institution U.S. Bancorp (USB) are all down in the premarket after releasing quarterly results. On the bright side, shares of electronics company TE Connectivity (TEL), aircraft manufacturer Textron (TXT), medical supplies company St. Jude (STJ), voice and language services provider Nuance Communications (NUAN), and railroad Norfolk Southern (NSC) are all indicating higher openings this morning after releasing quarterly results. – Matthew E. Spencer

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.

Before The Bell - The stock market opened for business yesterday, following a long three-day weekend, and the bulls took an early lead, emboldened by some constructive action overseas and by a succession of fairly upbeat earnings reports put out before the start of the trading day on our shores. To wit, after the first minutes of trading, the Dow Jones Industrial Average had sprinted to a gain of just over 60 points, while the tech-heavy NASDAQ, underpinned by additional strength in some high-profile technology names, had raced to a near-30-point early advance. But the good news did not last long, to the chagrin of the bulls.

Indeed, after peaking early in the morning, the market proceeded to give back all of its gains and then some by mid-morning, and by just before noon in snowy New York City, the blue-chip composite had plummeted to a loss of over 140 points. Then, after the lunch hour had started on the East Coast, and as the snow continued to fall and the temperatures fell, in concert, the equity market started to rebound. In fact, the losses were pared rather quickly and noticeably. That curative action then continued through the lunch hour, as the bargain hunters, if they can be called that at these extended levels, rushed in and took many groups higher. To wit, the NASDAQ, which had been up early then off about a handful of points in mid-session, returned to the plus column in short order, pushing to a closing gain of 28 points. As for the Dow, it couldn't make it all the way back, paring its triple-digit loss to less than 30 points, before closing down 44 points.  

Additionally, the Standard and Poor's 500 Index, which also had never been off by much, likewise joined the bullish parade, lifting that index to a mid-afternoon gain of some five points, before ending up by a similar amount. Further, the major mid- and small-cap benchmarks, which had led the way up in the morning, also moved higher again, while advancing issues widened their lead over declining stocks on both the Big Board and the NASDAQ.

Helping the bullish cause, we gather, was a continuing flood of decent, if not fully welcoming, quarterly results, especially on the revenue side. Heretofore in this bull market, bottom-line results had led the way, while revenues lagged. Now, the former is, at times, struggling a little and the latter is doing a bit better. On the other hand, some mining issues were lagging throughout, on the heels of bearish comments by some brokerage houses relating to iron ore and copper. Such tidings sent a chill through the shares of Cliffs Natural Resources (CLF) and Freeport-McMoRan Copper & Gold (FCX). Overall, though, the stock market acquitted itself comparatively well, as the urge to take profits remained well contained.

What unleashed this early selling? Well, for one thing, there are valuation concerns, as the market largely went straight up last year and P/E's are clearly stretched. For another thing, many investors are overly bullish, and that can lead to some pressure on prices. Third, earnings season hasn't been all that impressive, with many concerns barely beating lowered bottom-line targets. Also, the S&P 500 Index seems to be running into resistance at the 1,850 level, which it had broached briefly last week. Finally, the Federal Reserve, according to press reports, is set to announce some additional monetary tightening when its FOMC meeting takes place later this month. That put some traders on edge.    

Meanwhile, earnings season is now in full bloom, and with the Fed's meeting still a fortnight away and the economic calendar light until tomorrow, when we will get data on the leading indicators, existing home sales, and initial and continuing jobless claims, the focus is largely, if not exclusively, on earnings. And, as indicated, the news there has been anything but uniform, with a good number of misses, along with some outperformance. 

Looking ahead, after yesterday's mixed-to-modestly higher outcome, the markets in Asia overnight were mixed as well, while their counterparts in Europe are a little lower thus far this morning. As to the outlook over here, yesterday's frenetic action has not disheartened either the bulls or the bears, as the futures are pointing to a mixed opening here as well. Once again, there will be no economic data of note, but a large basket full of quarterly revenue and bottom-line metrics to go through. On this front, IBM (IBM - Free IBM Stock Report) has again missed on the revenue line, and that issue is suggesting a notably weaker start to the day.   - Harvey S. Katz 

At the time of this article's writing, the author did not have positions in any of the companies mentioned.