After the Close - U.S. stocks got off to a weak start on Monday, and things didn’t get any better as the day wore on. Notably, weakness in Apple (AAPL) shares created a large drag on the NASDAQ and S&P 500 indexes. The iconic computer and consumer electronics maker’s stock fell $18.55 a share today (3.6%), based on media reports that it had cut orders to suppliers that build components for its popular iPhone mobile device. The movement was notable as the stock has a 10% weighting in the NASDAQ composite and about a 3.8% weighting on the S&P.

On the flipside, and also in the computer space, shares of Dell (DELL) stock bounded by 13.0%, based on reports that the PC maker was looking to go private. Also in technology, Research in Motion (RIMM) stock moved up 8%, ahead of the scheduled debut of the company’s new smartphones later in the month.

Overall, though, decliners outpaced losers on a light day for economic news, with the S&P 500 shedding just over a point for the day, while the NASDAQ was down by eight points.

Over among the blue chips, the Dow Jones Industrial Average fared slightly better, in that it at least remained above the breakeven mark with a gain of 19 points. In an otherwise negative session, the Index found support in Hewlett-Packard (HPQ - Free HP Stock Report)shares, which were up 4.9% based on an improved Wall Street outlook.

European markets only fared slightly better, on the whole, though a downward trend was in evidence across the board. Germany’s DAX and France’s CAC-40 managed to eke out small gains, while London’s FTSE 100 fell slightly.

After the U.S. market’s closed, Federal Reserve Chairman Ben Bernanke was scheduled to give a talk on monetary policy in Michigan. The next few days will also bring reports on producer and consumer prices, retail spending, housing starts, as well as the weekly report on jobless claims. Earnings season will also likely take up investor’s attention, at least over the short term, with such heavyweights as Bank of America (BAC - Free BofA Stock Report), General Electric (GE - Free GE Stock Report), Goldman Sachs (GS), and Intel (INTC Free Intel Stock Report) set to report this week.  - Mario Ferro

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


12:20 PM EST - The U.S. stock market got off to a weak start this morning, but is now well off its lows. We will have to wait and see if buyers move in during the afternoon, as they have on many occasions lately. As we pass the noon hour in New York, the Dow Jones Industrial Average is in positive territory, up 10 points (0.1%); the S&P 500 Index is lower by three points; while the tech-heavy NASDAQ is struggling, off 13 points (-0.4%). Market breadth is mildly negative, as declining stocks are outnumbering advancers by a narrow margin on the NYSE. The market sectors are largely mixed, with advances in the transportation and the consumer non-cyclical stocks. The technology group remains weak today.

Technically, the S&P 500 Index continues to trade near high ground. Notably, a few attempts to break through this area are not unexpected, especially given the large runup that the market has staged over the past couple of months.  Sentiment is probably overly bullish, as implied by the low readings on the VIX. The contrarian theory suggests that as the majority of investors has turned bullish and is already heavily invested in the market, it becomes harder to find new capital needed to push the averages higher. Also, more investors are now sitting on gains, making the index susceptible to profit taking. So far, a heavy bout of profit taking, or a steep selloff, has not threatened the current rally.

There has been no material economic news this morning. Tomorrow will be busier with retail sales for December due out. We also will get a look at the Producer Price Index for December, as well as a report on the economy in the New York region.

Although the fourth-quarter earnings season has commenced, it has been a light day for releases. PPG Industries (PPG) posted a decent fourth-quarter report, but the stock is lower, nonetheless. Elsewhere, merger and acquisition activity is heating up. Flower Foods (FLO) is seeing its stock rise, after the company noted that it will buy select brands from Hostess. Other stocks worth mentioning include Apple (AAPL) which is lower by about 3% today to $504, and well off its 52 week high. Today’s weakness comes amidst reports that the company has reduced orders for iPhone 5 components, suggesting weaker-than-anticipated demand. -  Adam Rosner

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 Survey Earnings news is quite light today, though investors will have plenty of reports to examine later this week as earnings season ramps up. However, there are some notable pre-market movers this morning, including shares of Apple Inc. (AAPL), which are trading moderately lower on reports that the computer and personal electronics giant has trimmed orders for iPhone 5 components due to weaker-than-expected demand for the device.

On the M&A front, package delivery giant United Parcel Service (UPS) has dropped its $6.9 billion bid for industry peer TNT Express, after European regulators said that they were planning on vetoing the deal due to their belief that it would stifle competition on the Continent. UPS stock is up slightly in the premarket. Elsewhere, apparel company V.F. Corp. (VFC), in conjunction with Altamont Capital Partners, has made an offer to purchase Billabong, an Australia-based surfwear company, for roughly $556 million. Finally, Flowers Foods (FLO), a producer and marketer of packaged bakery goods, has agreed to purchase Wonder Bread and several other brands from bankrupt Hostess. – 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 limped to a small aggregate gain of Friday, on nominal strength in the blue chips, as the Dow Jones Industrial Average added 17 points on the day. However, other groups lagged, most notably the banks on some disappointment following the quarterly earnings release from financial services powerhouse Wells Fargo (WFC).

On the whole, though, it was a rather listless end to an uneven week on Wall Street, as a paucity of economic and political news was balanced out by some uneasiness over the start of quarterly earnings season. That event, which got under way gingerly last week, will be more definitively on display in the coming five sessions, as a good number of companies, both large and small will be posting their results for the past three months. We again note that expectations are low, following a sizable number of guidance adjustments over the past few weeks.

Our sense is that earnings season will be a mixed affair, which has become the norm over the past few quarters following several years in which much of the corporate world had routinely exceeded expectations. But the economic and profit recoveries are becoming somewhat long in the tooth, and not showing off the vigor that had characterized the earnings side, at least in 2009, 2010, and 2011.

As to earnings, the days ahead will feature the issuance of results from such economic giants as UnitedHealth Group (UNHFree UnitedHealth Stock Report), Bank of America (BACFree BofA Stock Report), Intel (INTCFree Intel Stock Report), American Express (AXPFree Amex Stock Report), and General Electric (GEFree GE Stock Report). How these and many other big names all fare in the days to come will likely have some influence on trading results.

It should also be noted that following a dull news week for the economy, with just data on the international trade gap issued last Friday, the business beat will pick up notably in the days ahead with reports on producer prices and retail spending tomorrow, and reports on consumer prices and industrial production on Wednesday. That session also will feature the issuance of the Federal Reserve's Beige Book economic summation. The week will then conclude with the weekly report on jobless claims and the monthly release of data on housing starts on Thursday. Lastly, we'll then see the monthly survey on the leading indicators issued on Friday.

Finally, there is Washington, which is now slowly gearing up for the latest installment of the long-running soap opera on the budget. The deadline for reaching an accord on mandated spending cuts is late February. At the same time, the government will also need to extend this nation's borrowing limits, popularly known as the debt-ceiling extension. Those fights figure to be even more contentious than the tax debate, which was only settled at the 11th hour on December 31, 2012.

As to the markets this morning, the NASDAQ futures are off sharply in the pre-market, losing some 16 points, as the shares of Apple Inc. (AAPL), the iconic computer maker are indicated to open some 3% lower on word that the company has now reduced its orders for components for the iPhone 5 due to weaker-than-expected demand. Also, there may be some skittishness ahead of a speech this afternoon at 4:00 (EST) by Federal Reserve Chairman Ben S. Bernanke. In all, we could be looking at a somewhat lower start to the upcoming trading day, which will commence in about a half hour from now. – Harvey S. Katz    

At the time of this article's writing, the author had positions in INTC.