After The Close - The U.S. equity indexes lacked direction during today’s session, generally trading in a tight band around the neutral line. If anything, there was a slight negative bias to the trading. On the Big Board, declining issues held a notable advantage over advancers, as there seemed to be a bit of profit taking after the major indexes moved higher last week. However, the opposite was true on the NASDAQ, where advancers outpaced decliners. The primary catalyst in the latter was a pickup of interest in the technology sector, led by the stock of Apple (AAPL). Investors were buying shares of the technology behemoth after they fell 13% last week following an unexciting earnings report.

Speaking of earnings, we received the latest quarterly results from Dow-30 component Caterpillar (CAT - Free Caterpillar Stock Report) before the market opened. Shares of the world's largest maker of heavy equipment traded higher after the company concluded 2012 with better-than-expected results. Fourth-quarter share net of $1.91 came in below the $2.32 earned in the year-earlier period, but was better than expectations. The Caterpillar report dominated the earnings news today, but investors should note that there are a few notable reports due out after the close of trading, including the latest results from technology heavyweights Yahoo! (YHOO), Seagate Technology (STX), and VMware (VMW). As noted, technology stocks performed relatively well, producing the biggest gain among the 10 major sectors. Conversely, the biggest laggard was the basic materials group.

Meantime, the busy week for the economy began on a mixed note. An hour before trading commenced on these shores, the Commerce Department reported that durable goods orders, which includes big-ticket items like jet aircraft, washing machines, cars, computers, and television sets, rose by 4.6% last month, more than twice the estimated 2.0% gain, and light years better than the tepid and downwardly revised November rise of 0.7%. The reading is a sign companies are betting the economy will pick up despite fears over tighter fiscal policy. Conversely, the National Association of Realtors said pending home sales fell 4.3% sequentially in December.  However, we still don’t believe that the disappointing housing report will throw any cold water on the recovering industry, as the decline was more supply driven than a function of slowing demand.

Tomorrow, we will receive another important snapshot of the economy when the latest reading on consumer confidence is released. All in all, there is growing sentiment that the U.S. economy continues to improve, even if still in fits and starts.  Earlier today, the National Association for Business Economics released a quarterly survey showing that half of the economists polled now expect real gross domestic product — the value of all goods and services produced in the United States — to grow between 2% and 4% this year. The latest reading was a big jump from the survey released three months ago that showed that only 36% of respondents felt the same way.

Elsewhere, the major European bourses were mixed, as investors took a breather after last week’s rally on the Continent. London's FTSE 100 and France’s CAC-40 indexes were nominally higher, while Germany’s DAX was off modestly. In a light news day on the Continent, investors learned that bank lending to private households in the euro zone contracted again in December, as the region's crippling debt crisis continues to put a freeze on demand for credit. Asia’s indexes also began the week on a mixed note, with the Nikkei falling nearly 1% on profit-taking after passing 11,000 early in the session.   - William G. Ferguson

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


12:30 PM EST - The U.S. stock market is putting in a mixed performance today, as traders digest recent gains. Technically, the S&P 500 Index is just at the 1,500 mark, which is likely a crucial area, and may well present some resistance. Fortunately for the bulls, we have not yet seen a large-scale selloff, which might precede a sharper pullback in the broad market.

As we pass the noon hour in New York, the averages are well off their lows. The Dow Jones Industrial Average is now off one point; the S&P 500 Index is flat; and the tech-heavy NASDAQ, which is bucking the downtrend, is adding on 11 points (0.3%). Market breadth is still negative, as declining stocks are ahead of advancers by a narrow margin on the NYSE. A number of the market sectors are in negative territory, with losses in the basic materials and consumer cyclical names.  On the bright side, the technology issues are having a good day.

Meanwhile, the economic reports provided mixed signals this morning. Durable goods orders rose 4.6% in December, coming in well ahead of analysts estimates, and up sharply from last month’s downwardly revised 0.7% increase. However, the news was not as good for the housing market. Specifically, pending home sales for December declined 4.3%, which was a far weaker showing than had been anticipated.  The homebuilding stocks, as a group, are sharply lower on the news. Tomorrow, we get a look at the Case-Shiller 20-City Index for November, and the consumer confidence figures for January. But, the big news of the week will be the Government’s Employment report for the month of January, due out on Friday. Many traders across the financial markets will likely be trying to trade around this release.

Meanwhile, the fourth-quarter earnings season continues to progress. Today, we heard from Dow component Caterpiller (CAT - Free Caterpillar Stock Report).  That stock is up after the earthmoving equipment maker put out a mixed report. We also heard from Biogen (BIIB). Those shares are higher, as the biotech company reported lower-than-expected earnings, but higher revenues. Notably, after the closing bell today, we expect to hear from Internet provider Yahoo! (YHOO).

Stocks moving higher today include: Keryx Biopharmaceuticals (KERX), Hess (HES), and Zynga (ZNGA). Issues headed lower include:  Jos. A. Bank (JOS) and 3D Systems (DDD).  - 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– Earnings season remains in full swing, with Caterpillar (CAT Free Caterpillar Stock Report), the largest producer of earthmoving equipment and a Dow-30 component, in the spotlight this morning. The stock rose modestly in the premarket following the release of Caterpillar’s fourth-quarter earnings. Meanwhile, shares of biopharmaceuticals company Biogen Idec (BIIB) are also trading slightly higher this morning, despite a soft December-period report. Several other companies, including Internet giant Yahoo! (YHOO), are scheduled to report today after the close. 

In other news, shares of Transocean Ltd. (RIG), the world’s largest offshore drilling contractor, got a boost in the premarket following reports that activist investor Carl Icahn had raised his stake in the company. – Kathryn M. Drew

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


Before the Bell
- It's back to work for Wall Street today after a weekend's respite. And those engaging in the frenetic fray or the daily stock market ebb and flow will find that the leading averages are mostly poised at multi-year highs, with the Dow Jones Industrial Average on the cusp of 13,900 and thus within several hundred points of an all-time crest. At the same time, the Standard and Poor's 500 Index has moved above 1,500, a psychological barrier that has been a tough place to cross above and stay there in the past.

And Wall Streeters return on a week that promises to be quite busy, both from an earnings standpoint and from the point of view of the economy. Specifically, the five days upcoming will see data tomorrow on consumer confidence, where a small lessening in optimism is the forecast. Then, on Wednesday the Federal Reserve's two-day FOMC meeting will conclude, where no change in either interest rates or the outlook is expected. Also on Wednesday, we are due to get the first look at fourth-quarter GDP, where a nominal 1.0% rate of improvement is now the forecast, following an artificially high and unsustainable growth rate of 3.1% in the third quarter. We sense that the presumptive fourth-quarter rate, which we feel may be exceeded modestly, will prove to be artificially low as well and likely to be notably improved upon over the course of the new year.

Then, on Thursday, we are due to get data on weekly jobless claims, which just hit another five-year low, but which are expected to have jumped sharply in the most recent week. We also are due to get data on personal income and spending that day. Then on Friday, the week will conclude with two key reports. First, an hour before the start of the trading day, the Labor Department will report on both non-farm payrolls for January and the jobless rate. Expectations here are that the nation added 168,000 jobs in the now-concluding month and that the unemployment rate held steady at a lofty 7.8%. Then, some 90 minutes later, the Institute for Supply Management, an industry trade group, will issue figures on manufacturing activity across the country for January, where a slight increase is the forecast.

Meanwhile, just moments ago, the Commerce Department reported that orders for durable goods had jumped by 4.6% in December, more than twice the gain that had been forecast. True, this is a notoriously volatile series, being heavily influenced by such large-ticket items as jet aircraft. However, that volatility aside, the gain was stellar and should augur well for industrial growth in the upcoming months.

As to earnings, they will be coming out hot and heavy this week, as fourth-quarter reporting season continues to drone on. To wit, the next five days will see reports from such Dow-30 companies as drugmakers Pfizer (PFE Free Pfizer Stock Report) and Merck (MRK - Free Merck Stock Report), aerospace behemoth Boeing (BA Free Boeing Stock Report), and oil giants Chevron (CVX Free Chevron Stock Report) and Exxon Mobil (XOM - Free Exxon Stock Report). Meantime, industrial goods provider Caterpillar (CAT - Free Caterpillar Stock Report) has already chimed in with results that have apparently pleased investors who are bidding the stock higher in the pre-market. Aside from Caterpillar, the overseas markets are subdued so far today, while our equity futures are generally pointing to a higher start to the trading day that is due to commence moments from now. - Harvey S. Katz

At the time of this article's writing, the author had positions in PFE.