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After The Close - The bulls picked themselves off the mat today after five consecutive losing sessions on Wall Street. Indeed, the Dow Jones Industrial, the NASDAQ, and the S&P 500 Index were comfortably in positive territory from the get-go—though some selling in the last hour of trading did erase a portion of the earlier gains. Still, by the closing bell, those three major U.S. indexes had added 90, 25, and 10 points, respectively, today. The primary catalyst was a better-than-expected earnings report from Dow-30 component Alcoa (AAFree Alcoa Stock Report) after the close of trading yesterday—the report officially kicked off the first-quarter earnings season. There also appeared to be some bargain hunting following the aforementioned decline in equity prices. All told, advancing issues outnumbered decliners by a considerable margin on both the Big Board and the NASDAQ.

As noted, a better-than-expected release from aluminum giant Alcoa helped lift investors’ spirits after a few dispirited sessions on Wall Street. In addition to lifting the fortunes of the basic materials sector, the capital goods and conglomerate stocks were up sharply. Notable individual gainers within those areas included the stocks of Caterpillar (CATFree Caterpillar Stock Report), Boeing (BAFree Boeing Stock Report), Textron (TXT), United Technologies (UTXFree United Tech Stock Report), and Owens-Illinois (OI). Another group that showed leadership today was the consumer cyclical sector. Financial stocks also were up nicely and are likely to be closely watched over the next few days, with the latest quarterly results from banking giants JPMorgan Chase (JPMFree JPMorgan Stock Report) and Wells Fargo (WFC) due later this week.

The economic news was light today. However, we did get the latest Beige Book summation from the Federal Reserve. The report was as expected, with the lead bank indicating that overall economic activity in the 12 Fed Districts continued to increase at a modest to moderate pace in February and early March. It did suggest that consumer spending was encouraging, which somewhat contradicts last week’s employment report that showed significant layoffs in the retailing space. The U.S. equity market did not react much to the report.

The European bourses also fared better today after a few difficult trading sessions on the Continent. European equities moved higher after rumors surfaced that the European Central Bank may restart its bond-buying program. Bond yields in Italy and Spain eased, perhaps in response. Not surprisingly, stocks of Italian banks posted the biggest gains after falling sharply in recent days on euro-zone sovereign-debt concerns.

Looking ahead, the attention of investors may now turn to the U.S. economy, with several key reports due the next two days. Tomorrow, we will receive data on initial weekly unemployment claims, the trade gap, and producer (wholesale) prices. Then on Friday, reports on consumer prices and consumer sentiment will hit the newswires. We also expect the investment community to keep tabs on Europe, particularly the recent plight of Spain—and on pending profit reports. – William G. Ferguson

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

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12:30 PM ET - The U.S. stock market opened sharply higher this morning, and has managed to hold onto most of its gains, so far. As we pass the noon hour in New York, the Dow Jones Industrial Average is up 99 points (0.8%); the S&P 500 Index is ahead 12 points (0.9%); and the NASDAQ once again taking the leadership role, is adding on 31 points (1.0%).  Market breadth is decidedly positive, as advancing stocks are ahead of decliners by over 4-to-1 on the NYSE.

All the major market sectors are participating in the move, with leadership coming from some key sectors. Specifically, the financial issues are up sharply, and that is always a good sign. There is also strength in the capital goods area, and in the transportation stocks. While there are no weak groups, the utilities are lagging the broader market. This has been happening for numerous months now, and is not too surprising, at this point. 

Today’s move higher clearly reflects improved sentiment. Traders turned bullish after Alcoa (AA - Free Alcoa Stock Report) posted its first-quarter results. The Dow component, and aluminum giant, posted better-than-expected sales and profits. The company also offered fairly positive guidance. The Alcoa report is important, as it suggests that commodity demand and pricing is stable. Notably, investors have been concerned lately about the commodity outlook, after some weak manufacturing reports in Europe, and the possibility of slower expansion in Asia. In telecom, Nokia (NOK) is seeing its stock sink, after the mobile phone maker issued weaker-than-expected guidance. In retail, JC Penny (JCP) shares are up on news that the CFO is reigning.  Corporate profit reports will be streaming in over the next few weeks, and upcoming results will likely help establish the market’s direction. 

Meanwhile, traders will also likely be digesting the Fed’s Beige Book summation, which is set to be released today at roughly 2:00 PM (EDT).

Technically, the S&P 500 Index suffered a sharp hit yesterday, after a series of consecutive daily declines, while trading volumes spiked, suggesting large scale selling had set in. The move drove the Index quite a bit below its 50-day moving average, located at roughly 1,375. The S&P 500 is now at 1,369, and is attempting to reverse some of this damage. We will now see if the buy-the-dip crowd can step in again, or if sentiment is truly turning negative, at least for a while.   - Adam Rosner

At the time of this article's writing, the author had a position in Alcoa (AA).

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Stocks to Watch from The Survey Aluminum maker and Dow-30 component Alcoa (AA - Free Alcoa Stock Report) kicked off first-quarter earnings season yesterday after the stock market closed by reporting markedly better-than-expected results and upbeat guidance. The stock is up sharply in premarket trading.

United States-listed shares of Finnish cellular phone manufacturer Nokia (NOK) tumbled in the premarket today, after the company cut its first-quarter guidance.

A few other companies are joining the earnings parade today. ADTRAN (ADTN), which designs and manufactures high-speed digital transmission products, has reported first-quarter numbers that were roughly in line with our estimates. Meanwhile, building materials company Apogee Enterprises (APOG) is scheduled to report February-period results after the market closes today. - 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 selling picked up some additional speed down on Wall Street yesterday, pushing the Dow Jones Industrial Average down by another 214 points, bringing the two-day setback in that aggregate group of 30 large-cap stocks to almost 350 points. The other averages--from the NASDAQ, to the S&P 500 Index, to the small-cap Russell 2000, to the S&P Mid-Cap 400 Index--also pulled back notably, as a wave of selling hit the global markets. The European bourses, closed for a holiday on Monday, did proportionately worse falling by around 3% overall, with stocks in Italy plunging almost 5%. Our losses, by comparison, were quite modest. 

Worries about Europe, in the wake of rising interest rates and faltering financials in Spain, the negative response to last Friday's dour employment report in our country, and concerns about earnings season, which is now just getting under way, combined to take the measure of the bulls yet one more time yesterday. In regard to the latter concern, the focus in the latest session was on Alcoa (AAFree Alcoa Stock Report), as that Dow component and aluminum making giant was due to report its latest quarterly results after the close of trading yesterday. In anticipation, Alcoa shares fell back rather sharply during the session. All were expecting a sharp drop in earnings from the fourth quarter, and investors got just that. However, the falloff was not as pronounced as feared, and the outlook provided by management was better than forecast. The stock, in response, rallied strongly in after-hours trading, and the issue is indicated to open at $9.84 a share this morning, after a close of $9.32 a share yesterday.

The earnings beat, meanwhile, will pick up later in the week as a pair of large banks, Dow component JPMorgan Chase (JPMFree JPMorgan Stock Report) and Wells Fargo (WFC), are both due to report. Earnings season will really get going next week, however, when a dozen of the Dow 30 will report their first-quarter results, along with many high-profile concerns not in the Dow.

As for the stock market, Europe has gotten off the mat this morning, gaining sharply, and in the process erasing a good chunk of yesterday's losses, while our futures, sensing some optimism in the wake of the Alcoa report, are gaining traction as well, with the S&P futures now up almost 10 points and the NASDAQ futures better by 18 points, presaging a strong rebound at the start of the trading day in less than an hour from now.

Meanwhile, the economy will also be in the news today, as the Federal Reserve will issue its Beige Book summation of the business situation across the country later this afternoon. That compilation will be used by the central bank in helping it chart the nation's monetary course at the bank's next FOMC meeting. Then, tomorrow, we will get data on jobless claims, the trade gap, and producer prices, while Friday will see the issuance of reports on consumer prices and consumer sentiment.

However, the focus of Wall Street in the coming few weeks is likely to be on earnings and the course of the first-quarter results from Corporate America. Of course, the unstable situation in the euro zone also will be a focus, as investors strive to see whether the pullback in stock prices here over the past week, is a brief diversion or the start of something bigger, such as a full-fledged market correction--something we have not seen for more than six months. – Harvey S. Katz

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