Dow +9.36 (+0.07%)
Nasdaq +8.79 (+0.37%)
S&P 500 -1.27 (-0.09%)
News That Moved the Market
Cap Lifted For Home Loan Providers. The markets took off early in the session on news that the Office of Federal Housing Enterprise Oversight decided to remove Fannie Mae's (FNM, +1.1%) and Freddie Mac's (FRE, -0.5%) $1.5 trillion mortgage portfolio cap. The cap was created after the two companies found $11.3 billion in accounting errors in 2006. The lenders should now be better able to provide financing for the U.S.'s troubled housing market. Earlier in the morning, Fannie Mae reported a greater than expected $3.6 billion loss and shares of the company hit a 12-year low, but news of the regulator's decision turned the stock around. Later in the day, the markets sold off, as investors pocketed profits. It seems many do not want to leave profits on the table when a bad piece of data or headline could erase any gains.
Bernanke Signals Further Rate Cuts. Fed Chairman Ben Bernanke spoke in front of the Senate Banking Committee Wednesday and provided some relief to investors. Despite rising inflation pressures, he indicated the Fed would continue easing rates as economic downside risks remained the key focus.
Economic Data Misses Estimates. The Commerce Department reported durable goods fell 5.3%, which was slightly worse than expected. Meanwhile, new homes sales came in at 588,000, missing the 600,000 expected and representing a 13-year low. Both pieces of data were not horrible, but showed signs of a deteriorating economy.
Quick Tics: The EU slapped Microsoft (MSFT, -0.4%) with a record $1.35 billion anti-trust fine…The U.S. dollar hit a record low against the euro ($1.5118/euro) after Bernanke signaled further rate cuts…Gold futures hit an all-time high of $967.70/ounce… Nortel Networks (NT, -13.3%) reported steeper losses, announced job cuts, and released a worse than expected growth forecast for 2008.
Notable Earnings (Full List Here):
Cablevision Systems Corp.(NYSE: CVC) Before Open
Dell, Inc. (NASDAQ:DELL) Before Open
Gap Inc. (NYSE:GPS) After Close
Kohls Corporation (NYSE:KSS) After Close
Sears Holdings Corp (NASDAQ:SHLD) Before Open
Viacom (NYSE:VIA) After Close
XM Satellite Radio (XMSR) Before Open
8:30 AM: GDP
8:30 AM: Chain Deflator
8:30 AM: Initial Job Claims