After The Close - The U.S. market staged a rebound this morning, and managed to build on its gains through the afternoon. As noted in the past, the way the market acts in the afternoon is often critical as it can show traders’ degree of commitment. At the end of the session, the Dow Jones Industrial Average rose 188 points; the broader S&P 500 Index was up 22 points; and the NASDAQ was ahead 46 points. Market breadth was quite positive, as advancing issues were ahead of decliners by about three to one on the NYSE. Strength could be seen throughout all of the market sectors, with particular gains in the basic materials group. The consumer names acted well, too. While there was no real weakness in the market today, the healthcare issues and utilities lagged other sectors, possibly suggesting traders were more willing to take on risk.

Technically, today’s rally was one of the stronger moves that we have seen in a while. Notably, all of the major averages rose more than 1%, and the general feeling seemed to turn positive. From here, we will look for some follow-through, as another strong day would lend credibility to the bulls. The VIX retreated sharply, to just above 17 today, suggesting a possible shift in sentiment, too.

The economic news picked up today. Initial jobless claims moved lower to 331,000, which was a better reading than was widely anticipated. The employment situation continues to be an area of concentration, especially with the January employment report due out tomorrow. Notably, traders are likely watching these employment figures, as it may impact the Fed’s stance. Meanwhile, the nation’s trade gap came in at $38.7 billion in December, up from $34.3 in November.

Traders received another batch of earnings reports to sift through. In the emerging social media area, Twitter (TWTR) issued decent figures, but investors were concerned about slower growth in active users. The stock traded sharply lower on the news. General Motors (GM) shares didn’t participate in the advance, after the automaker missed expectations. Things went better for Disney (DIS - Free Disney Stock Report), as that issue rose on a good release. Meanwhile, Green Mountain Coffee Roasters (GMCR) saw its shares rise, as the company announced that it was partnering with soft drink giant Coca-Cola (KO - Free Coca-Cola Stock Report). After the bell, we hear from LinkedIn (LNKD).   – Adam Rosner

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


12:30 PM EST - Stocks are sharply higher today on favorable earnings news and some corporate dealmaking. Right around the noon hour on the East Coast, the Dow Jones Industrial Average is 156 points higher and the NASDAQ is a very healthy 46 points to the good. Market breadth affirms the positive feelings, with advancing issues outpacing decliners by a wide margin.
Conditions were ripe for a rally coming into today’s trading with the Dow off nearly 7% a mere five weeks into the year following tepid earnings results from some big companies and turbulence in a number of emerging markets. The latter item was seen as having been partially induced by the Federal Reserve’s slowdown in bond buying, as well as less bullish sentiment toward China—the premier emerging market—where the pace of economic expansion has eased.

Meanwhile, this morning’s business data weren’t uniformly upbeat, but has not derailed the snapback in stocks. The Labor Department reported that weekly initial jobless claims fell and indicated that the nation’s productivity rose a bit more than expected in the fourth quarter. For the year, productivity gains were muted, though, and a wider than anticipated December trade gap created concerns regarding GDP growth.

Among individual companies, shares of Walt Disney (DIS - Free Walt Disney Stock Report), a Dow-30 component, surged after the entertainment giant late Wednesday reported an operating profit that topped analysts’ estimates by a wide margin.

Elsewhere, Coca-Cola (KO - Free Coca-Cola Stock Report) stock is also helping the push higher on the Dow, after the iconic beverage manufacturer announced a deal with Green Mountain Coffee Roasters (GMCR). Coke will be making its products available in Green Mountain’s K-cups, for use in an upcoming at-home beverage dispenser. Part of the arrangement calls for Coke to take a 10% stake in Green Mountain, which has sent GMCR shares skyrocketing.

Another winner on the day is Yelp (YELP) stock, after the online reviewer of businesses and services exhibited continued growth on several fronts.

Several notable stocks are not faring as well, though. One of those is Twitter (TWTR), which was an IPO in 2013 and whose shares were soaring until signs of slower growth appeared this week.
Another notable name trading to the downside is that of insurer Prudential (PRU), where profits fell short of projections.

But, overall, Wall Street is in a good mood today, ahead of tomorrow’s important government nonfarm payroll report. -  Robert Mitkowski

At the time this article was written, the author owned stock in Intel.


11:15 PM EST - The bull, held in check for much of this year thus far, has sprung back to life, at least for one morning, and helped to send the leading equity market averages spiraling ahead.

On point, after about 90 minutes of trading, the Dow Jones Industrial Average, boosted by selective good news on some key components, is ahead by 150 points; the Standard and Poor's 500 Index is better by 16 points; and the tech-heavy NASDAQ is up by about 48 points, or better than 1%. The small and mid-cap indexes also are doing well, with gains of 1%, or more.

Behind this across-the-board win for the recently chastened market optimists was a bigger-than-forecast decline in weekly jobless claims, upbeat corporate news from a succession of U.S. corporations, and some optimism ahead of tomorrow's report on January non-farm payrolls and the accompanying unemployment rate. An increase in the December trade deficit did not embolden the bulls, however. Overall, though, the news was good.

The upbeat economic news, meanwhile, has hurt the bond market, where the yields on Treasury issues, which move in the opposite direction of bond prices, are up. Specifically, the yield on the benchmark 10-year Treasury note has climbed back to 2.70%, while the yield on the companion 30-year Treasury bond is back up to 3.67%.  -Harvey S. Katz, CFA

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 SurveyThe earnings calendar is busy today, with a number of high-profile companies having recently reported quarterly results. Investors appeared pleased with December-period financials and/or outlooks from media companies Disney (DISFree Disney Stock Report) and AOL (AOL), restaurant operator Dunkin Brands Group (DNKN), and Internet company Yelp (YELP). The biggest winner, however, is clearly Green Mountain Coffee Roasters (GMCR). Indeed, that stock is soaring ahead of the bell, after the coffee company released December-period results and announced a partnership with beverage heavyweight Coca-Cola (KOFree Coca-Cola Stock Report).

It was not all good news, however, and shares of automaker General Motors (GM), Internet radio provider Pandora Media (P), and engine manufacturer Cummins (CMI) are all moving lower ahead of the bell on earnings news. – Matthew E. Spencer

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


Before The Bell - The stock market, which tumbled on Monday, tried to fight its way back on Tuesday, eventually undoing roughly a third of that initial damage. Then, it sought to build on that partial comeback yesterday. And for a time, it appeared as though the bulls would secure a rare back-to-back early 2014 triumph. However, it was not to be. Thus, after a mid-session effort to reverse some of the earlier, substantial damage in the equity market, the leading indexes all gave ground. However, save for the tech-laden NASDAQ, which fell 20 points, the setbacks were modest by the close.

To wit, the Dow Jones Industrial Average ended just five points lower after sinking early on by slightly more than 100 points, while the Standard & Poor's 500 Index, which had been off by 18 points at its nadir, finished the session lower by just four points. Even the NASDAQ, a 63-point loser at its worst level of the day, gained back all but the aforementioned 20 points of that setback. It was much the same story for the small- and mid-cap indexes. It has been hard for the market to rally this year, and yesterday was no exception.

Behind this continuing malaise, which has the Dow leading the way lower with better than a six percentage-point loss so far this year, are concerns about the emerging markets, where equity, bond and currency risks are rising, about China and Japan, where growth is slowing, and regarding Europe, where the latest data showed a contraction in retail spending in December. And on our shores, there are worries about the ongoing Federal Reserve monetary tapering, uneven recent business data (after a strong second half of last year), and a hit-and-miss corporate earnings season.

All of this plus some fluffy valuations entering the year, has put the U.S. equity market about half way toward a correction, which is defined as a drop of some 10% in the affected averages. We aren't there yet, as noted, but such a pullback is widely mentioned as a possibility by many market watchers. In fact, just such a notable setback has already taken place on Japan's Nikkei 225 and the Hong Kong Hang Seng Index. Sometimes, such warnings can become self-fulfilling prophesies.

Meanwhile, as to our economy, yesterday was a mixed session. On point, we saw the addition of 175,000 private-sector jobs last month, according to ADP (ADP). That was a bit below consensus. On the other hand, the Institute for Supply Management reported that its survey on non-manufacturing activity came in above expectations and slightly better than the December tally. That was an especially welcome metric as the companion release on manufacturing activity, which had been issued on Monday, came in well below expectations and that weak survey result helped to deepen the decline in the market that day, and contributed mightily to the 326-point setback in the Dow.   

Meanwhile, looking at other developments, we saw after the market closed yesterday that beverage maker and Dow-30 component Coca-Cola (KO - Free Coca-Cola Stock Report) announced that it was taking a 10% stake in Green Mountain Coffee Roasters (GMCR). The latter stock, which closed the session at $80.88, is indicated to open the session this morning at more than $114 a share. Coke shares are indicated to open slightly higher, meantime. However, the news wasn't all that compelling for Twitter (TWTR). Here, concerns about future growth is pummeling that stock in the pre-market. Specifically, the issue closed yesterday at $65.97 a share; early pre-market indications are at just under $52 a share.

Finally, the European Central Bank somewhat disappointed investors by its decision today to leave interest rates unchanged. Still, the markets in Europe are a bit higher today, while our futures are gaining nicely ahead of the opening in less than an hour from now. All told, the S&P futures are ahead by just over eight points, while the NASDAQ futures are gaining about a dozen points.   – Harvey S. Katz

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