Dow +114.70 (+0.91%)
Nasdaq +17.51 (+0.75%)
S&P 500 +9.49 (+0.69%)
News That Moved the Market
IBM Announcements Push Markets Higher. Some days you take what you can get and do not ask why. Despite a deluge of bad news this morning (see below), the markets traded higher as investors focused on IBM's (IBM, +3.9%) announcement of a new $15 billion buyback plan and increased outlook. After the news came out in during mid-morning trading, stocks took off. IBM increased its EPS estimate for 2008 by $0.05, and said it has seen strength in foreign markets and received a boost from acquisitions.
Weak Data From All Directions. The Labor Department reported the Producer's Price Index came in at 1.0%, while core-PPI increased by 0.4%. Both readings were well ahead of expectations and put the Fed in a tough position of fending off inflation while trying to stimulate growth. The Conference Board reported consumer confidence fell to a 5-year low, and the S&P/Case-Shiller home price index showed that prices plummeted 8.9% in the fourth quarter of 2007, compared to the year before. With signs of a weak economy and increasing inflation, fears of stagflation jumped.
Target Sees Tough First Half of 2008. Target (TGT, +3.1%) reported earnings before the bell that beat expectations by a penny, but said it expects to see "a challenging economic climate at least through the first half of the year." The company has seen shoppers buying more necessities and less higher margin items such as clothing.
Quick Tics: Google (GOOG, -4.6%) continued its drop today on news that its pay-per-click advertising may by weakening…Radio Shack (RSH, +21.5%) jumped after better than expected fourth quarter financial results…Crude finished up 1.9% to $101.09, a new closing high.
Notable Earnings (Full List Here):
Toll Brothers(TOL) Before Open
Nortel Networks (NT) Before Open
Dollar Tree Stores (DLTR) Time Not Supplied
8:30 AM: Durable Goods
10:00 AM: New Home Sales
10:30 AM: Crude Inventories