After The Bell - Sentiment toward stocks was dampened again today by fresh concerns over the fate of the euro zone. Word that politicians in Greece were unable to form a new government and that the hard-hit nation is likely headed for new elections next month created uncertainty for investors. The fear is that Greece will ultimately leave the euro zone, creating financial disruption. Indications that depositors in Greece’s banks are withdrawing large amounts of funds didn’t help matters.

As a result, the gains that stocks had flirted with for most of the session faded in a late afternoon selloff. At the close, the Dow Jones Industrial Average finished down 63 points and the NASDAQ was off nine points. Two stocks fell for every one rising on the New York Stock Exchange composite.

The flight to safety was apparent in the strength of the U.S. dollar. The dollar has been rising since the beginning of May, about the time that stocks began to falter from their impressive October-to-April rally. Strength in the dollar has, meanwhile, weakened support for commodities, such as oil and gold, whose prices tend to move in the opposite direction. Falling oil and gold prices, in turn, have hurt the shares of producers, such as Occidental Petroleum (OXY) and Newmont Mining (NEM).

On the flip side, certain transportation equities, such as shares of Union Pacific (UNP) provided a pocket of strength today, as they stand to benefit from lower fuel costs.

Tomorrow brings a full slate of economic data and a handful of earnings reports from some well-known companies. The latest statistics on housing starts and business permits for April are on the agenda, where a moderate expected rise for housing starts may be largely offset by a decline in building permits. Fresh figures for industrial production and capacity utilization will also be available, and stronger month-to-month data are expected in both cases.

On the earnings front, releases from Deere (DE), Limited Brands (LTD), Staples (SPLS), and Target (TGT) are on deck. Analysts figure Deere is due to report a strong comparison, but only slight gains are forecast for Staples and Target. Limited Brands is expected to turn in an unimpressive showing.

Overall, the tone of the economic data may influence stocks to a greater extent than the earnings reports from a handful of select companies, since investors are looking for a broad uplift. If the economic numbers are convincingly to the upside, they could provide Wall Street with a respite from its proliferating worries over Europe. - Robert Mitkowski

At the time this article was written, the author did not have positions in any of the companies mentioned.


12:30 PM ET - The U.S. stock market is putting in a choppy performance today. However, at about noon in New York, the U.S. markets are making a push higher. The Dow Jones Industrial Average is up 60 points (0.5%); the S&P 500 Index is higher by six points (0.5%); and, the NASDAQ is ahead by 28 points (1.0%). Market breath is now slightly positive, with advancing issues outnumbering decliners by a thin margin on the NYSE.  The mixed tone is still apparent in the market sectors, where there is some weakness in the basic materials, consumer cyclical names. The utilities are also a bit weak today.  In contrast, there is some strength in the technology and services stocks, as well as in the transports.

The situation on the Continent remains of concern. While traders were likely enthusiastic about a decent economic report from Germany, uncertainty surrounding Greece put a damper on the session. The major bourses spent more of the session advancing, but later surrendered those gains, ending up in negative territory.  This may have prompted the pullback in the U.S. markets. Meanwhile, the euro now at $1.27, is slipping further against the dollar. 

Back on our shores, the economic news did little to initially move the markets. This morning the Department of Commerce reported that retail sales for the month of April increased 0.1%, versus the 0.7% advance logged last month.  Later, the Department of Labor reported that consumer prices for the month of April showed no change, which probably came as no real surprise, as inflation is not viewed as a problem. On the bright side, manufacturing in the New York region jumped sharply, which was a surprise.  Further, according to the NAHB, housing prices were up in May. This may be helping the real estate related issues, as the Home Builders Trust (XHB) is up over 1% today.

In corporate news, Groupon (GRPN) is seeing its shares rise sharply after the Internet company posted decent profits on strong revenues. Shares of Agilent (A) are moving up after that company posted better-than -expected profits. However, Home Depot (HD - Free Home Depot Stock Report) reported results that more or less matched the consensus. That stock is off slightly, possibly over concerns about guidance.

Technically, the S&P 500 Index may have found some support at the 1,340 level, which held in March and February. However, it should be noted that we have not seen much bargain hunting going on, and there seems to be some flight- to-safety behavior emerging. The VIX is now reading about 21, which suggests that traders are again getting concerned.  - 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 Survey Investors are digesting a slew of earnings reports from retailers today. Leading the charge is the world's largest home-improvement center and Dow-30 component, The Home Depot (HD - Free Home Depot Stock Report). Despite reporting solid fiscal first-quarter (ended April 29th) earnings and increasing its guidance, investors appeared to focus on the top line, which came in just shy of the consensus expectation. The stock fell notably on the news. Shares of Lowe’s (LOW), the number two home-improvement retailer, fell along with its larger rival, though Lowe’s is not scheduled to release fiscal first-quarter results until May 21st. Also reporting April-period results were high-end department store Saks (SKS), sporting-goods seller Dick's (DKS), and discount retailer TJX Companies (TJX). Investors appeared most pleased by Dick’s results, and bid that stock solidly higher in the premarket. After the market closes today, J.C. Penney (JCP), a department store catering to middle-income shoppers, is scheduled to release quarterly financials.

In other news, privately-held fragrance maker Coty has pulled its bid to acquire direct cosmetics seller Avon Products (AVP), causing that stock to fall sharply in early morning trading. – 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 - Wall Street started the new week off pretty much the way it proceeded for much of the previous five-day stretch, that is by falling and doing so decidedly. Once again, it was worries about Europe's economy and political fortunes, with a dash of angst about our economy and the fate of the banking sector thrown in, following JPMorgan Chase's (JPMFree JPMorgan Stock Report) acknowledgement, late last week, that it had incurred a massive trading loss in its accounts.

All told, and even after some half-hearted rally attempts throughout the day, the leading equity averages all finished the session sharply lower, with respective losses in the Dow Jones Industrial Average, the NASDAQ, and the Standard and Poor's 500 Index of 125 points, 31 points, and 15 points. The percentage losses were all pretty much the same, being in the range of 1%. Meanwhile, the small-cap Russell 2000 Composite lost 11 points, or 1.4%. These setbacks came in the wake of substantial losses in the European bourses earlier in the day.

By far the biggest factor in yesterday's extension of the stock market's losing streak over here were new concerns that beleaguered Greece could soon exit from the single-currency euro zone, as that debt-encumbered nation is caught in a political impasse in the wake of the prior week's inconclusive election returns and the subsequent inability to fashion a workable governing coalition.

Wall Street again focused on the euro zone yesterday, as there were few news items of note over here. However, that paucity of critical economic issuances ends abruptly this morning, as the government has just released data on both consumer prices, which showed a benign inflation reading once again, and retail sales, which indicated just nominal overall strength at the spending counter in April, following March's strong showing, which was due, in large part, to the early Easter holiday.

Looking ahead, we are scheduled to get data on housing starts and industrial production tomorrow morning. Then, in the afternoon, the Federal Reserve will issue the minutes from its most recent FOMC meeting (which took place on April 24th and 25th). That issuance can sometimes be market moving. On Thursday, we are then due to get the latest weekly reading on initial jobless claims. The leading indicators and the Philadelphia Fed will also weigh in with their findings about the economy that day. So after a news hiatus yesterday, the business beat will be picking up noticeably over the balance of the week.

As to the global markets, they are rebounding this morning thus far, as investors have done some bargain hunting after a handful of losing sessions over the past week, or so. A better reading on exports from Germany, which was released this morning, has also helped to underpin sentiment. As for the rest of the euro zone, data issued today also indicated that economic output was flat in the latest three months. Expectations had been that such activity would have declined, suggesting that the region was in a recession. Such a pullback may still be ahead, however, but perhaps not as sharp a setback as has been feared.

On the other hand, there was a sales report from giant do-it-yourself retailer Home Depot (HDFree Home Depot Stock Report), which missed expectations and that stock is indicated to open lower today. As for our futures, they are up strongly at this hour, with the S&P 500 Index futures ahead by 10 points and the NASDAQ futures racing forward to the tune of 23 points, presaging a nice comeback at the start of the trading day in about a half hour from now. – Harvey S. Katz

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