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After The Close - The U.S. stock market put in a rare weak performance today. Although the session started off on a moderately soft note, the selling picked up in the afternoon. Traders may be getting a bit more apprehensive, as the VIX rose about 7%, to over 14, today. However, this is still a very tame reading, and suggests that bullish sentiment is intact. Technically, the S&P 500 Index ended just above the 1,500 mark, which may be a key support level, as it corresponds to a large round number.

At the end of the day, the Dow Jones Industrial Average was off 44 points (-0.3%); the S&P 500 Index was down six points (-0.4%); and the tech-heavy NASDAQ closed off 11 points (-0.4%). Market breadth was decidedly negative, as declining stocks outnumbered advancers by roughly 2 to 1 on the NYSE. Almost all of the market sectors ended in negative territory, with steep losses in the transportation, energy, and capital goods stocks. In contrast, the consumer non-cyclical issues and the defensive utilities held up relatively well.

Meanwhile, the economic reports were mixed today. The employment situation still looks to be improving. The ADP Employment Change Report showed 192,000 jobs were added to the private sector in January, which was better than the consensus view calling for 175,000. Notably, this month’s figure was also an improvement over the December showing. We will get more information on employment when the weekly initial and continuing jobless claims data come out tomorrow. Of course, this is all in advance of the January non-farm payroll report due out Friday morning. It is not surprising that traders may be getting wary of holding positions in advance of this release, as the markets are at high levels and some key data are due out.

Furthermore, traders got a rather weak reading on fourth-quarter GDP this morning. The preliminary estimate showed the economy contracted 0.1% for the quarter, where many analysts had been calling for a 1.0% advance. Elsewhere, the Fed did not make any changes to its interest-rate policy, and maintained that it would continue making asset purchases. Some of the weakness in the market today may also have come from concerns about the Fed statement.

The earnings reports keep coming in. Today, we heard from Dow component Boeing (BA - Free Boeing Stock Report). That stock advanced after the aerospace giant put out a healthy report. We also heard from Northrop Grumman (NOC). Those shares were lower, on more mixed news. Elsewhere, Internet retailer Amazon.com (AMZN) put out a weaker-than-expected set of figures, but the shares moved up, probably on the year-ahead outlook. - 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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12:15 PM EST - As we have opined here in recent days, the market is clearly overbought right now—the S&P 500 Volatility Index (or VIX) continues to trade in an area that would suggest such—and thus any disappointing news could cause some profit taking on Wall Street. That seemed to be the case this morning, as a dour report on the nation’s economy (more below) may have prompted some selective selling in a market that is overextended. As we pass the midday hour on the East Coast, the Dow Jones Industrial Average and the S&P 500 Index, in fact, are nominally lower. The NASDAQ is slightly higher on the strength of a strong earnings report from a technology stalwart (see below). That said, a sign that investors are showing a bit more caution today, which has not been the case thus far in 2013, is the even more pronounced selling taking place in the small- and mid-cap indexes. The negative tone to trading is underscored by the notable lead declining issues are holding over advancers on both the Big Board and the NASDAQ.

The news on the U.S. economy could be termed mixed. However, the day’s biggest report was very disappointing. Specifically, an hour before trading commenced on these shores, the Commerce Department reported that the nation’s GDP contracted by 0.1% in the final quarter of 2012, which was well below the consensus expectation of a 1% advance. The shrinkage was basically the result of declines in government spending--most specifically defense outlays--as well as lower exports and a slowdown in inventory accumulation. The dispiriting GDP report was somewhat offset by encouraging data on private-sector payroll creation. Automatic Data Processing (ADP) reported that private-sector employment increased by 192,000 jobs in January, up from a downward revised December figure of 185,000 positions. Later this afternoon, we will receive more commentary on the U.S. economy when the Federal Reserve concludes its two-day FOMC meeting. The consensus there is that the central bank will keep its accommodative monetary policies in place, especially given the aforementioned disappointing GDP data.

Meantime, the earnings news today has proven to be more market supportive—and may be a reason why the selling is not even more pronounced at this moment. Of note was a good report from aerospace giant Boeing (BA Free Boeing Stock Report). The Dow-30 component posted strong fourth-quarter results and also said that the recent problems with the Dreamliner 787 won’t weigh on its near-term bottom-line performance. Shares of Boeing are up modestly on the news. Shares of Amazon.com (AMZN) are also up nicely following its latest quarterly report, as investors cheered the technology giant’s sales growth and higher North American margins. The Amazon.com advance is helping support the technology stocks so far today. Other notable companies that reported results today included MeadWestvaco (MWV), Avery Dennison (AVY), Northrop Grumman (NOC), and Boston Properties (BXP).   

From a sector perspective, technology and the consumer cyclical groups are showing some mild strength. Conversely, the basic materials, financials, energy, and industrials stocks are the laggards right now, with the decline most pronounced for the energy issues. The other groups have moved off of their earlier lows in the last hour. The performance of the last four groups is not all that surprising as those sectors are closely tied to the health of the U.S. economy. Perhaps, the weak GDP report earlier this morning is behind the mild selling in those areas.

Looking ahead to the remainder of the trading day, investors are sure to keep an eye on what the Federal Reserve has to say about the economy this afternoon. On the earnings front, we will get reports from ConocoPhillips (COP) and Facebook (FB) after today’s close. Stay tuned.  - 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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Stocks to Watch from The Survey: On a day marked by the release of crucial economic data, there is also a bevy of high-profile companies set to report earnings.

First and foremost, Boeing (BA - Free Boeing Stock Report), the aerospace and defense behemoth and Dow-30 component has released favorable  fourth-quarter figures and the stock is indicating a slightly higher opening. Boeing leads a busy day in the aerospace/defense arena as we are set to hear from Northrop Grumman (NOC) and L-3 Communications (LLL), too

Elsewhere, Facebook (FB) the social media leader, is set to release its fourth-quarter earnings. The stock has rebounded mightily since its substantial fall following its IPO. However, it is down in premarket trading.

Finally, in the energy field, Hess (HES), which rose by 9% yesterday when it announced plans to divest the assets it has that are not being used in exploration and production, is set to issue fourth-quarter results.   - Andre J. Costanza

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 - Stocks generally moved forward yesterday, albeit with some notable holdouts, as investors continued to wade through a succession of mostly decent earnings reports, a mixed run of economic data, and some logical angst ahead of this afternoon's conclusion of the latest Federal Reserve FOMC meeting.

Specifically, the Dow Jones Industrial Average, buoyed by a better-than-expected earnings issuance from drug giant Pfizer (PFE - Free Pfizer Stock Report), which helped that stock to a 3.2% gain on the day, jumped 72 points, bringing that 30-stock composite to within some 45 points of the psychologically significant 14,000 level. In all, the Dow stands just 210 points shy of its all-time peak reached during the ballyhoo days of late 2007. The Dow, it should be noted, subsequently fell more than 50% in the following year and change.

Also helping many larger-cap stocks yesterday was strength in certain energy issues, with those stocks benefiting from the recent rise in oil prices. Of course, the genesis of that increase in energy quotations--unsettling developments in parts of the Middle East--is less welcome.

As to the economy, the news was, as noted, mixed. To wit, the Conference Board reported at 10 yesterday morning (EST) that its survey of consumer confidence had fallen sharply this month--a fourth consecutive decline for that closely tracked barometer of sentiment. At the same time, a report on home prices put out by S&P/Case-Shiller showed a bigger increase in prices than had been forecast. This sector continues to rebound, which appears to be a combination of a large and noteworthy bounce off of the bottom and a real increase in demand. The better housing news and a good earnings report from D.R.Horton (DHI) helped the homebuilding equities--and most notably D.R. Horton--press forward nicely in the latest session. The reception for Ford Motor (F), though, was less compelling, as that carmaker saw its shares fall nearly 5% on the day.    

Looking ahead, the Fed, as indicated, will conclude its FOMC meeting later on today, with no change in either interest rates or its accommodative language expected by most pundits. In fact, even though there may not be unanimity in this approach, the release of economic data just moments ago, should serve to vindicate the Fed's loose monetary policies. That is because the U.S. Commerce Department has issued its first estimate of the nation's fourth-quarter gross domestic product, and the report was an eye opener. Specifically, the government noted that U.S. GDP, which had been expected to gain a percentage point in the period, actually fell by 0.1% in the quarter--the first decline in that metric since early 2009.

Behind the fall, which compared unfavorably with an unchanged third-quarter growth estimate of 3.1%, were declines in inventory investment, federal government spending, and exports. We continue to believe that this was a one-quarter affair and that GDP will return to its winning ways, if just tentatively, in the first quarter of the new year. However, for now, at least, this is a setback for those suggesting that the nation's expansion is on ever-firmer ground.

As to the market's reaction, the bourses in Europe are taking little stand so far this morning, while our equity futures, which were mixed a little earlier this morning, have now tilted just modestly to the downside, seemingly not disarmed by this disquieting news on the business front.   - Harvey S. Katz

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