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After The Close - The U.S. stock market headed lower this morning, and was unable to pare its losses in any meaningful way. In fact, at the end of the day the averages were at or near their session lows, as the buy-on-the-dip crowd failed to step in. All told, the Dow Jones Industrial Average was off 190 points; the broader S&P 500 Index was down 18 points; and the technology-heavy NASDAQ surrendered 47 points. Market breadth confirmed the significant market weakness, too, as declining stocks outnumbered advancers by roughly three to one on the NYSE. All of the market sectors were stuck in negative territory, with sharp losses in the consumer and finance sectors. However, the utility issues, while a bit lower, managed to show some relative strength.

Technically, the U.S. market managed to advance yesterday, but that move may not have been large enough to signal a reversal of direction. Meanwhile, there was no follow through today, as traders were somewhat concerned about emerging market weakness, lackluster profits, and possibly further bond purchase reductions here at home. Meanwhile, the S&P 500 Index is now well below its 50-day moving average, which may be of some concern to technical traders. For now, it remains to be seen if the bulls can mount a sustained buying effort, or if the market will head lower with a more sizable correction unfolding.  Meanwhile, sentiment turned a bit bearish today, as the VIX moved up about 9%, to roughly 17.25.

There were no major economic reports released today and that may have contributed to some of the weakness. There was one item worth noting. The FOMC concluded its two-day meeting, and the Fed is sticking with its plan to taper its asset purchases. With another $10 billion reduction announced, the Fed’s asset purchases now stand at $65 billion a month. With all the headlines surrounding this issue, traders should be used to this idea by now, but perhaps they were looking for some assurances, especially with the problems now brewing in the emerging markets that the Fed will proceed more slowly. Tomorrow, things pick up, as we get a look at the advance estimate for Q4 GDP, the weekly jobless claims, and a report on pending home sales.

There were quite a few earnings releases issued this morning. Needless to say, the market was not impressed. AT&T (T Free AT&T Stock Report) stock traded lower, even though the company put out decent figures. Apparently Wall Street was concerned about wireless subscriber additions. Further, Amgen (AMGN) put out a solid release, but that issue headed lower, too. After the close, we will hear from Facebook (FB).  - 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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12:00 PM EST - As we reach the midday hour on the East Coast, the major U.S. market averages are toiling in the red, with both the large- and small-cap indexes under moderate selling pressure, though they are in some cases attempting to make their way back from earlier lows. A kitchen sink of concerns, including some disappointing earnings from Corporate America, fears of an emerging markets crisis and contagion, and a pending decision of possible further bond-buying tapering from the Federal Reserve later this afternoon, greeted investors as the markets opened and such anxieties have weighed on equities throughout the first half of the session. Overall declining issues are holding a sizable lead on advancers on both the NYSE and the NASDAQ, to the tune of more than two to one on the former.

The Dow Jones Industrial Average was hurt by negative reaction to results and guidance from two of its companies within the last 24 hours. Investors are punishing the shares of Boeing (BA - Free Boeing Stock Report) and AT&T (T - Free AT&T Stock Report), with aerospace giant’s selling accounting for about a third of the index of 30 bellwether companies’ decline. However, those two blue-chip stocks are certainly not alone as many of their fellow Dow members are in the red, too. Other very active stocks on heels of company earnings releases include Yahoo! (YHOO), Dow Chemical (DOW), Electronic Arts (EA), and McCormick & Co. (MKC). In particular, shares of Yahoo! fell notably after the Internet search engine giant reported weaker-than-expected ad revenues in the latest quarter. Staying in the technology space, investors will be looking at the latest quarterly results from social media giant Facebook (FB) after the close of trading today.

From a sector perspective, the biggest laggards among the top-10 groups are the consumer staples and telecommunications stocks. The big culprit appears to be some weak earnings news from the two sectors. Those two groups do have a lot of companionship in negative territory so far today. Conversely, bucking the downward movement are the utilities and basic materials sectors. The latter is being helped by strong showings from a number of the precious metals and mining stocks. The price of gold, which is viewed as safe-haven holding, is up around 1% on the Chicago Mercantile Exchange. In the same vein, the utilities issues are being helped by their defensive appeal in a market where volatility has spiked in recent days. The S&P 500 Volatility Index (or VIX) is climbing again today after a pullback yesterday.

It was quiet morning on the economic front stateside, but there was some negative news from overseas that is pressuring equities both here and abroad. Specifically, investors are worried that Turkey’s central bank’s decision to raise rates is not having the desired effect on the lira, and the problems could spill over to other European countries and cause some headaches for the world’s financial system. That said, all eyes will shift this afternoon to the U.S. economy when the Federal Reserve announces its monetary policy decisions, especially with regards to its monthly bond-buying program. A bigger-than-expected tapering could pressure the equity market further. Conversely, if the Fed stays on the same accommodative course or announces a smaller reduction in asset purchases, the market may get a boost. If anything the Fed’s decision could make for a volatile conclusion to the trading day. - 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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10:50 AM EST - The bulls, who had successfully stemmed the flow of red ink yesterday, as the equity averages moved ahead moderately following a succession of recent losses, are back behind the eight ball again this morning--and in a rather big way.

To wit, after a little more than an hour's worth of trading, the Dow Jones Industrial Average is off 125 points; the Standard and Poor's 500 Index is lower by 12 points; and the NASDAQ is down by 28 points. Also, the mid- and small-cap indexes, as represented by the S&P Mid-Cap 400 and the Russell 2000, respectively, are notably lower, as well.

This latest reversal seems to have several causes. First, there are the emerging markets, where equity losses due to economic and currency fears, are mounting. Then, there is corporate earnings season, which has not been what the bulls had been hoping for. Finally, there is the Federal Reserve, which is due to wrap up its latest FOMC meeting in a little more than three hours from now. The consensus expectation is that the central bank will engage in some additional monetary tapering, but that it will leave interest rate unchanged at their historic lows.

We would expect the market to move back and forth into the meeting's conclusion. Thereafter, it likely will depend on what the Fed decides to do and what its accompanying statement will suggest about future actions. - Harvey S. Katz

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 SurveyEarnings reports continue to flow in at a fevered pace. Investors were generally not impressed with today’s batch of financials from large, bellwether companies. Most notable, shares of telecommunications heavyweight AT&T (TFree AT&T Stock Report), aerospace and defense company Boeing (BAFree Boeing Stock Report), and Internet company Yahoo! (YHOO) are all indicating weaker openings this morning on earnings news. Other stocks moving lower ahead of the bell after releasing December-period results and updating outlooks include biotech Amgen (AMGN), software developer VMware (VMW), semiconductor company Cirrus Logic (CRUS), health insurer WellPoint (WLP), drugmaker Biogen Idec (BIIB), airline operator JetBlue (JBLU), and household products company Tupperware Brands (TUP).

On the other hand, investors appear pleased with quarterly financials from video game developer Electronic Arts (EA) and chemicals company Dow (DOW), as these equities are up in pre-market trading, with DOW showing considerable strength. Additionally, Sotheby’s (BID) stock is moving nicely higher ahead of the bell, after the auction house declared a special dividend of roughly $4.34 a share and released the results of its capital allocation and financial policies review. – 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 - Wall Street, which had meandered about in a directionless pattern this month, until late last week, before succumbing to some of the most damaging profit taking in the last year, sought to right the ship in trading yesterday. Unfortunately for the chastened bulls, they started the latest session with one hand tied behind their back--namely a lackluster quarterly report and cautious guidance from once-high-flying technology icon Apple Inc. (AAPL). That report issued about 30 minutes after the market had closed on Monday, was hardly what those long the issue had envisioned.

And, on cue, the disquieting outlook from this NASDAQ stalwart served to put that index immediately behind the eight ball. To wit, even as the futures on the Dow Jones Industrial Average and the Standard and Poor's 500 Index initially rallied, the NASDAQ futures saw further downward action thanks to the aforementioned Apple.

Thus, when the market opened for trading, the indexes showed a clear dichotomy, with the Dow and the S&P 500 Index rallying, along with the small- and mid-cap sector, but with the NASDAQ again pressing lower, albeit not dramatically so. As the morning progressed and investors balanced out a pair of uneven economic reports issued in the interim--specifically, data showing that orders for durable goods had fallen unexpectedly in December and that consumer confidence had shown a nice gain this month--the equity market extended its early rise. The equity market was led by the basic materials names, including some steels, most notably Cliffs Natural Resources (CLF), after the release of news that an investor group had earlier taken a 5.2% stake in the struggling iron ore producer, and one of the worst performers on the S&P 500 Index last year, urging restructuring moves and a higher dividend payout. Cliff’s stock rose sharply at first, but as the day wore on its gains were pared back, with the volatile issue finally closing up just about 2%. Meanwhile, it is indicating a lower start this morning in the pre-market.

Meanwhile, led by a near 100-point increase in the Dow and by roughly a 10-point jump in the S&P 500, the market was able to offset some lingering softness in the NASDAQ through the lunch hour. Then, in the early afternoon, as the Dow and the S&P stabilized at their higher levels and they continued to be joined by the S&P Mid-Cap 400 and the small-cap Russell 2000, the NASDAQ, despite the aforementioned selloff in Apple that stayed in the 7%-8% range, managed to turn the corner, pushing to a nifty gain of some 10 to 15 points in mid-afternoon. Stocks then refused the temptation to sell off anew, and equities ended the day comfortably in the black. In the process, Wall Street broke the multi-session losing streak, finally managing a recovery of 91 points in the Dow, 11 points in the S&P 500 Index, and 14 points in the NASDAQ, even as Apple continued to trade notably lower, losing more than 40 points in all. Basically, it was a day of modestly successful bargain hunting following the trio of down days. Meanwhile, other stocks in the news yesterday were a pair of Dow-30 components, chemicals giant DuPont (DD - Free DuPont Stock Report), which sold off slightly on in-line metrics and drug maker Pfizer (PFE - Free Pfizer Stock Report), which rose almost 3% on better-than-expected results. As to other markets, oil rose in price yesterday; gold backtracked some; and bond yields fell, with the return on the 10-year Treasury note easing back to 2.75%.    

Other than Apple, the two reporting Dow stocks, and the pair of economic reports, the focus was again on the emerging markets (which had been leading the market lower until yesterday on currency concerns in Argentina, Turkey, and Brazil), and the Federal Reserve, which will conclude its two-day FOMC meeting at 2:00 (EST) this afternoon. At that time, expectations are that the bank will extend the monetary tapering that it began last month. Of course, the recent turmoil in the emerging market sector could dissuade the Fed from continuing to taper this month, although we sense that such a move in that direction is a less likely event than not. It should be noted that the current meeting is the last that Ben S. Bernanke will chair, with Janet Yellen, his successor, taking over the helm next month.

Now, we look ahead to a new day, and as we do we find that stocks were up overnight in Asia, and they are now extending their prior-session gains in Europe. On our shores, however, the futures, which had been up strongly earlier are now suggesting a weaker opening when trading gets under way in less than an hour from now. How the stock market closes today is obviously up in the air, and to a greater extent than on most days, with the central bank's FOMC meeting still more than five hours from its conclusion and the issuance of its accompanying monetary statement. - Harvey S. Katz     

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