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After The Close - The bulls were back in the driver’s seat today in this holiday-shortened week, after two days of selling on Wall Street. Bargain hunters were propelled by an upbeat report on Germany’s economy and better-than-expected results from one-time tech mainstay Hewlett-Packard (HPQ). The notion that the Federal Reserve is contemplating reducing its fiscal stimulus—a key underpinning of the two-day pullback—didn’t seem as worrisome today, either. That added to the session’s upbeat tone. 

At the close, the Dow Jones Industrial Average was up 120 points, closely right at the 14,000 level, and the NASDAQ added 30 points. Market breadth was broadly positive, with more than two stocks gaining for every one falling on both the Big Board and the NASDAQ.

But despite Friday’s push higher, a number of market professionals figure the bears are still lurking. According to European Commission officials, the euro zone is projected to contact for the second consecutive year in 2013, with unemployment topping 12%. That could rekindle the type of fireworks that rattled investors on both sides of the Atlantic these past few years. Moreover, the uncertainty over the effect of mandated government budget cuts in the United States creates an air of uneasiness.

Next week will mark the final days of trading in February, and the beginning of March on Friday. Monday looks to be a quiet day regarding economic reports, but Tuesday will bring fresh data on the housing market recovery and a look at consumer confidence.

On Wednesday, more housing data and an updated Durable Goods Order indicator are on tap. Thursday will bring the customary report from the Labor Department on weekly first-time unemployment claims, a reading on the Chicago PMI, and a closely watched revision to fourth-quarter GDP. Big swings from earlier GDP readings are not uncommon, and it is possible that the U.S. did better than the negative 0.1% showing initially measured. Such a showing is not assured, of course, but would favor the bulls if it materializes.

Friday will bring data on Personal Income & Spending, manufacturing, and construction spending, but the government’s important monthly employment report, normally published on the first Friday of a new month, is scheduled for March 8th.   - Robert Mitkowski
         
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 EST  -  The bulls appear to have taken back the reins today, as the major U.S. stock indexes are all solidly on the plus side as we pass the noon hour in New York. Computer giant Hewlett-Packard (HPQ Free HP Stock Report), in particular, has garnered a lot of attention after its fourth-quarter earnings and sales topped Street estimates. The Dow component’s shares are up nearly 10% at midday, and have advanced 65% since reaching their nadir back in November. Traders also appeared to be relieved when Germany’s Ifo Institute reported that its German business climate index rose more than expected. Altogether, we’re currently looking at gains of right around half a percentage point for the Dow Jones Industrials, S&P 500, and NASDAQ.

The party, understandably, is a bit more lively across the pond, where the favorable news regarding Europe’s largest economy bears more direct impact. Spirits got a further lift from the European Commission’s projection that most of its member nations would succeed in cutting their budget deficits this year, despite the fact that the euro zone, as a whole, will likely remain in recession for a while longer. This was good enough for all the major bourses to bounce back from shaky sessions the prior two days. France’s CAC 40 is leading the charge, up 2.3%, but Germany’s DAX has been no slouch either, gaining just over 1%, while London’s FTSE 100 brought up the rear with a still respectable advance of 0.7%. - Mario Ferro

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 still in the news today, headlined by technology giant and Dow-30 component Hewlett-Packard (HPQFree Hewlett-Packard Stock Report), which reported better-than-expected January-period results after the market closed yesterday. The issue is trading notably higher in the premarket as a result. Other stocks indicating sharply higher openings this morning on earnings news include wireless networking company Aruba Networks (ARUN), health information services provider WebMD Health (WBMD), and Marvell Technology Group (MRVL), a producer of integrated circuits for data storage, transmission, etc. On the other hand, shares of high-end department store operator Nordstrom (JWN) and teen apparel and accessories retailer Abercrombie & Fitch (ANF) are both trading lower ahead of the bell, after releasing January-period financials. – 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 - Chalk up another win for the heretofore forlorn bears, as those perennial pessimists, who have had very little to cheer about since November, will take any gift they can get, and over the past two sessions, they have been on the receiving end of some rare good news.

To be sure, we have not had routs of monumental proportions. But we have had a modest retracement of the recent gains. In all, the setbacks, which evolved largely from cautionary comments by some Federal Reserve Board members concerning a possible early end to the central bank's historic bond-buying program, have seen the Dow Jones Industrial Average fall a combined 155 points, and the NASDAQ give back more than 80 points. The pullback, which was even more pronounced in the small- and mid-cap arena, may well have been an overreaction, as these were simply some musings by a couple of Fed Board members, and not a statement from Reserve Board Chairman Ben S. Bernanke following an FOMC meeting. Still, even a hint that the bank may end its aggressive easing campaign before the expected termination date (which has been 2015) can cause some consternation--and that is just what has happened, it would seem.

However, these concerns seem to be abating this morning, as upbeat data on Germany's economy, which was highlighted by a gain in a business climate index in that country, which is the largest economy in Europe, erased some fears that this heretofore resilient behemoth might be slipping into recession. In response, the European bourses are all pressing higher this morning, following nifty gains in Asia overnight. And on our shores, a better-than-expected earnings report from ailing computer giant and Dow component Hewlett-Packard (HPQFree Hewlett-Packard Stock Report) is giving our futures a nice early lift. Specifically, the Standard and Poor's 500 Index futures are now ahead by almost eight points and the NASDAQ futures are in the plus column by just under 15 points. This solid early showing suggests, as we have speculated upon above, that this two-day respite from the stock market's strong ascent could be coming to an end, although it is early, and the Fed worries will not go away all at once.

Meanwhile, the recent slide in equity prices also may be suggesting concerns about the pace of economic growth on our shores. In fact, yesterday's wide-ranging data were instructive in this regard, as we saw a tepid rise in sales of existing homes, although the makeup of the report, including another decline in the sale of distressed properties, was more encouraging. Less-hopeful was a 0.3% increase in the so-called core rate of the Consumer Price Index (which backs out food and energy) and a jump in first-time jobless claims. A regional manufacturing survey also was discouraging. All of that aside, we continue to believe that GDP growth in the current quarter will exceed 1%. That should be a decent enough showing, if accompanied by further good news in the corporate profit arena, to keep the bulls satisfied for a while. – Harvey S. Katz

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