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After The Close - It was a nondescript finish to a rather blasé week on Wall Street. The Dow Jones Industrial Average, the NASDAQ, and the S&P 500 Index barely strayed from the neutral line for much of the session before the Dow and the NASDAQ firmed ever-so slightly near the close. Much like the rest of the week, there was little news of substance to push the equity market forcefully in either direction. Of note, though, was a move this week that pushed the S&P 500 Index to a five-year high. That broader index finished unchanged today, while the Dow 30 and the NASDAQ, as noted, managed to book nominal gains. In all, some selective late-day buying resulted in a mixed session for equities. Declining issues led advancers on both the Big Board, though, while the latter held a slight advantage on the NASDAQ.

From a sector perspective, there was not a lot to get excited about. Among the top-10 sectors, some ground was given by the financial and telecom stocks. In the financial space, shares of banking giant Wells Fargo (WFC) were weaker despite the company topping consensus expectations on both the top and bottom lines in the fourth quarter. Investors, though, did not like that margins fell to a multi-year low and mortgage originations dropped from $139 billion in the third quarter to $125 billion during the most-recent reporting period. Meanwhile, shares of credit card giant American Express (AXP - Free American Express Stock Report) moved slightly higher after the company preannounced better-than-expected fourth-quarter earnings and said that it will continue its cost-cutting initiatives. Also, the technology sector held up relatively well today, getting a nice boost from the stock of Infosys (INFY), which jumped after the business consulting company reported strong earnings and raised its full-year 2013 earnings and revenue guidance. The stocks of tech behemoth Apple (AAPL) and Google (GOOG), though, were a little lower in the latest session.

Meantime, we did get some noteworthy non-earnings news from Corporate America today. Specifically, reports surfaced last night that two more Boeing (BA - Free Boeing Stock Report) Dreamliner 787 jets have experienced structural issues. In response to the latest difficulties, the U. S. Federal Aviation Administration has ordered a review of the aircraft's electrical systems. Shares of the Dow-30 component and aerospace giant fell once again today.     

Elsewhere, the major European bourses also ended the week on a ho-hum note. Germany’s DAX, France’s CAC-40, and London’s FTSE-100 were all marginally higher when trading concluded on the Continent. The performance, though, was a bit encouraging when considering that today’s economic data from the euro zone was far from uplifting. Spain reported a 7.2% year-over-year drop in industrial production; the same metric decreased by 2.4% year-over-year in the United Kingdom; and France’s current account reading showed a deficit of 2.90 billion euro. Too, a major U.S. investment bank lowered its forecast for Germany's fourth-quarter GDP growth.

Speaking of the economy, we received our only noteworthy U.S. news this week before the market opened today when the Commerce Department said the U.S trade deficit of international goods and services widened by 15.8%, to $48.7 billion, in November, as shipments of smartphones and related goods into the U.S. rose sharply. The data could be termed mixed, as it likely means that economic growth in the final quarter of 2012 slowed, but at the same time consumer spending is perking up, which could be a good sign for the economy as 2013 progresses. Not surprisingly, consumer noncyclical stocks fared relatively well in the mixed equity market today.

Looking ahead to next week, it will be an extremely busy five-day stretch on both the earnings and economic fronts. Several Dow-30 companies will headline a heavy schedule of earnings reports. Meantime on the economic beat, we will receive data on producer and consumer prices, retail sales, industrial production, housing starts, and the leading indicators. We will also get the latest Beige Book summation of economic conditions from the Federal Reserve. This plethora of news will likely pull the investment community’s attention away, at least for the moment, from the pressing budget issues on Capitol Hill. That may not be a bad thing for the market as the negotiations in Washington between the two political parties is likely to be drawn out and contentious over the next several weeks.   - 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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12:20 PM EST  - The U.S. stock market has put in a somewhat weaker performance this morning, as traders look for direction. Some of the averages are now off their lows, however. Notably, lately we have seen bargain hunters entering the market late in the session, and that may prove to be the case again today. As we pass the noon hour in New York, the Dow Jones Industrial Average is up 12 points (0.1%); the S&P 500 Index is lower by one point; and the tech-heavy NASDAQ is down similarly. Market breadth is slightly negative, as declining stocks are outnumbering advancers by a small margin on the NYSE. Most of market sectors are trading lower, with large losses in the basic materials group, due to weakness in the metals and mining stocks. The financial issues are also weak today. In contrast, the technology and healthcare equities are bucking the downtrend.

Technically, the S&P 500 Index is making an effort to move into new high ground. Notably, the Index was near 1,475 in mid-September, before hitting resistance and selling off in October. The market is now back near that level, but moving higher may prove difficult again. Sentiment is still bullish, and probably to an extreme. The VIX is still under 14, which is a very low reading, and is of concern. 

The economic news did little to help the market move higher this morning. The nation’s trade gap came in at $48.7 billion in November, which was much wider than most analysts had expected. Elsewhere, both import and export prices declined in December, suggesting little inflation. Meanwhile…

The fourth-quarter earnings season is just getting started. The financial sector is in the spotlight today. Banking giant Wells Fargo (WFC) reported solid results for the fourth quarter, but the stock is off, nonetheless. Also, American Express (AXP Free American Express Stock Report) pre-announced decent fourth-quarter profits, and affirmed some headcount reductions. The stock was lower initially, but has since recovered.  The fact that the market is not rallying on some decent reports from these leading financial companies may be worth consideration, possibly suggesting that expectations have run too high, or that the bulls may be running out ofsteam. In retail, Best Buy (BBY) stock is up on a strong sales report.  - Adam Rosner

At the time of this article’s writing, the author did not have positions in any of the companies mentioned.
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Stocks to Watch from The Survey Earnings reports are starting to trickle in, with today’s most notable release coming from Wells Fargo (WFC), one of the nation’s largest banks. Fourth-quarter earnings per share were slightly better than expected, but investors appeared to be less enthused about some other aspects of the report, and the stock is trading slightly lower in the premarket. On the other hand, Wall Street cheered an earnings report from Infosys (INFY), and that stock is surging ahead of the bell. The global information technology services company delivered strong December-period results and issued upbeat guidance.

Elsewhere, shares of American Express (AXPFree American Express Stock Report) are indicating a marginally lower opening this morning, after the financial services company released preliminary fourth-quarter results and outlined a number of charges that it took in the period due to restructuring initiatives (primarily in its travel business) and reimbursements. – Matthew E. Spencer

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

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Before The Bell - The bulls made it two up days in a row yesterday, more than reversing the pair of down sessions that had preceded this latest rally. As has been the case recently, the gains were a function of generally prevailing optimism on the earnings front, as fourth-quarter reporting season is now under way.

Leading the way yesterday, as has been the fashion of late, were the banks, where the improvement in profitability is likely to be most pronounced. To wit, shares of Bank of America (BACFree BofA Stock Report) jumped by just over 3% on the day, closing at $11.78 a share. During the past 52 weeks, that volatile issue and Dow-30 component, has traded as low as $6.41. Also ending the session higher was Wells Fargo (WFC). That banking behemoth reported its results in the past hour, and it chimed in with record quarterly and full-year net. However, that result was apparently not enough to satisfy the more aggressive profit watchers, and that issue is indicated to open today's session modestly to the downside after an initial buying spurt evaporated.

Meanwhile, as noted, the market pressed higher in the latest session, with a late buying burst carrying the Dow Jones Industrial Average to an 81-point gain. The Standard and Poor's 500 Index also rose, adding another 11 points, and reaching a new five-year high in the process. Not to be outdone, the NASDAQ rose 16 points, although that advance lagged both the Dow and the S&P in percentage terms.

In other news, there was comparatively little of that commodity on the economic front. Still, the Labor Department did report a gain in initial jobless claims for the latest week, although continuing claims, which cover former workers seeking benefits for more than one week, fell to their lowest level in almost five years. The jobs market is improving, but the gains are incremental and often go unnoticed.

As to the other big story, or rather the non-story at the moment, there is the next looming fiscal cliff. This time the Congressional soap opera is concerned with both mandated spending reductions and the need to raise the nation's borrowing limits, popularly known as the debt ceiling. We think those deadlines, which come up at the end of next month, will be in the news shortly after the conclusion of earnings reporting season. That quarterly event is likely to go on for another three, or so, weeks. During that stretch, we would expect the market to hold its own, unless, of course, there are unsettling events on the overseas front, which is less predictable. Assuming little is heard from that sphere, the focus figures to be squarely on earnings, where the expectations are low and profit beats are likely in many cases. That combination should help the market stay on at least a plateau. Thereafter, it may be more of a wildcard. If the past is prologue, we would sense that the political drama would go down to the wire and market volatility, now low would likely increase.

As to the markets this morning, the futures have edged into the black, but ever so slightly following mild losses earlier this morning. That likely higher start follows a mixed showing in Asia overnight, where the Nikkei was up by a stellar 1.4%, but Hong Kong's Hang Seng Index was in the red to the tune of almost a half a percentage point. Stocks are generally a bit higher now in Europe. – Harvey S. Katz

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