YAHOO[BRIEFING.COM]:
Stocks put together a fairly strong rebound Thursday. Financials spurred the
advance as investors bought into the idea that the government's forthcoming
plan to shore-up banks could provide an impetus for a rally.
Financials were down as much as 4.7% in the early going, but
managed to climb to a gain of 4.1% after analysts at UBS stated that bank
bailout news could induce sizable rallies. Senate Banking Chairman Dodd told
reporters it might be possible to modify its mark-to-market rules, which would
be a boost to banks hurt by write-downs. Financials finished the session
1.4% higher.
Reuters cited a Treasury official when it reported Treasury
Secretary Geithner is expected to unveil a
comprehensive financial framework plan Monday. With the government
progressing toward a comprehensive plan to help restore the financial system,
investors were willing to look past mixed earnings and economic data that had
actually put stocks under pressure in the early going.
Cisco
(CSCO 16.35, +0.51) topped quarterly earnings expectations, but disappointed
investors when it issued downside revenue guidance. Cisco was able to rebound
with the help of other large-cap tech stocks. Large-cap tech led the Nasdaq in outperforming the other
headline indices.
Visa
(V 53.74, +4.61) and MasterCard
(MA 159.84, +19.69) both announced better-than-expected quarterly earnings and
optimistic forecasts. However, analysts question whether they card companies
can continue growing their earnings at rapid rates amid a pullback in consumer
activity.
Softer consumer spending prompted numerous retailers to issue
cautious forecasts amid lower January same-store sales. However, many
retailers' comparables were not as bad as feared, which induced gains in the
group. The S&P 500 Retail Index finished 3.3% higher. Meanwhile, Wal-Mart (WMT 48.56, +2.14), BJ's Wholesale (BJ 29.56, -0.70), Aeropostale
(ARO 22.81, +1.68), and The Buckle
(BKE 23.36, +1.61) distinguished themselves by reporting same-store sales
increased.
Weekly initial jobless claims were up for the fourth straight week,
this time climbing 35,000 to 626,000 for the week ending Jan. 31. The number
exceeded the 580,000 claims that were expected, and was the highest level since
1982. The shock from such heightened claims is tempered by the knowledge that
the workforce has grown in recent decades. For that reason, some economists do
not believe the unemployment rate will break into the double digits -- the
government's official jobs report is due ahead of Friday's opening bell.
The drop in employment actually helped inflate fourth quarter
productivity. Since hours worked has fallen at a faster clip than economic
output, fourth quarter productivity increased 3.2%. An increase of 1.5% was
expected.
Meanwhile, soft economic conditions are undercutting inflationary
pressures. Fourth quarter unit labor costs increased 1.8%, which is less than
the consensus forecast of a 2.8% increase.
Trading volume hit a two-week high this session, exceeding 1.6
billion shares on the