Tuesday Closing Update

by: Midnight Trader

Stocks returned to red late in the session, forfeiting the modest gains that emerged after improved economic data. Lingering worries about the spread of swine flu and its impact on the global economy kept the market on a choppy path throughout the day. Financials were leading decliners after a report said Bank of America (NYSE:BAC) and Citi (NYSE:C) need more capital.

-NYSE down 19.9 (0.4%) to 5,369.85.

-DJIA down 8 (0.1%) to 8,016.95.

-S&P 500 down 2 (0.3%) to 855.16.

-Nasdaq down 5 (0.3%) to 1,673.81.

GLOBAL SENTIMENT

Hang Seng down 1.92%

Nikkei down 2.67%

FTSE down 1.69%

DOWNSIDE MOVERS


(-) BAC, C as report says gov't wants banks to raise more capital.

(-) UAUA, AMR, LCC caught up in negative sentiment for travel stocks.

(-) X swings to loss.

(-) NOK cutting 450 jobs.

(-) LVLT Q1 revenue misses Street, cutting 150 jobs.

(-) NTAP downgraded at Merrill Lynch.

UPSIDE MOVERS


(+) NVAX sees benefit of expected demand for anti-virals.

(+) PRXL beats earnings expectations.

(+) VLO earnings top year-ago quarter.

(+) BMY beats by a penny.

(+) PFE beats with Q1 results, lowers FY guidance to reflect Wyeth acquisition.

(+) ODP meets with Q1 sales.

(+) TLAB beats with Q1 results.

(+) XRX swings to profit.

MARKET DIRECTION

Stocks retraced early losses after a report showed consumer confidence jumped in April to the best level of the year. But the broad averages continued to swing from losses to narrow gains throughout the session as swine flu concerns weigh on economic sentiment and financial shares were dogged by a report that Bank of America (BAC) and Citigroup (C) are still short of capital.

C and BAC have been told by federal regulators that they may need to raise more capital based on the results of stress testing, the Wall Street Journal reported. The shortfall amounts to billions of dollars at BofA, the paper said, citing people familiar with the bank.

Deutsche Bank also cited Bank of America and Wells Fargo & Co (NYSE:WFC) and eight other banks that may be short of capital based on its own examination of 16 banks. It initiated coverage of the banks with "hold" ratings.

The U.S. consumer confidence index jumped to 39.2 in April from 26.9 in March, the Conference Board reported this morning, boosting stocks. The 12.3 point gain in the index was the fourth-largest ever in the 32-year history of the survey as consumers start to feel better about the future of the ailing economy. The figure was higher than the 30.5 reading that economists had predicted. Consumers showed the most significant change in confidence about their expectations for the economy.

The latest report on housing also gave investors a glimmer of optimism. The Standard & Poor's/Case-Shiller index showed home prices in 20 major cities dropping by 18.6% from February 2008. That was slightly better than January's 19% and the first time since January 2007 the index didn't set a record. The 10-city index slid 18.8 percent, the first time in 16 months its decline was not a record. Some economists see that as a sign the market may be stabilizing.