YAHOO[BRIEFING.COM]: A
disappointing forecast from FedEx and a rating cut for multiple banks weighed
on stocks in early trading and eventually gave way to a broad selling effort.
Stocks were able to recover from their lows, but finished the session with
mixed results.
FedEx (FDX 50.70, -0.72) announced its latest
quarterly results ahead of the opening bell, which featured
better-than-expected earnings. However, the transportation and package delivery
company lost favor when it issued downside guidance. FedEx weighed on
transportation stocks, leading the Dow Jones Transportation Average to a 0.3%
loss.
Software company Adobe
(ADBE 28.68, +0.51) reported its latest quarterly results last
evening. The announcement featured in-line quarterly earnings and an in-line
forecast.
Financial stocks came under
sharp pressure in the early going and finished 2.6% lower. Banks were a primary
source of weakness as Standard & Poor's lowered its ratings and revised its
outlooks on 22 banks. Wells Fargo (WFC 23.09, -1.31), Fifth
Third (FITB 6.81, -0.37), and US Bancorp (USB 17.77,
-0.09) were among those that were included in the revisions.
US Bancorp, along with several
other firms, announced that they have redeemed the preferred shares that they
issued to the Treasury under the TARP program, which was aimed at helping
capitalize banks amid tumultuous economic and credit conditions. In the wake of
that mess, President Obama proposed a new regulatory structure for the
financial sector today.
Financial stocks led the
S&P 500 briefly below its 200-day moving average, but stocks were able to
find support there. In turn, the stock market swung from a 0.9% loss at its
session low to a 0.7% gain at its session high. The advance failed to hold into
the close, though.
Materials stocks (-1.3%) and
energy stocks (-1.4%) also weighed on the broader market. Energy stocks were
unable to recover from early weakness, even though oil prices settled higher by
0.8% at $71.06 per barrel after being down more than 2% despite a
larger-than-expected weekly inventory draw.
Materials also failed to
recover, despite the CRB Commodity Index's rebound, which suggested a broad
range of commodity prices turned higher. The CRB had been face to face with its
fourth consecutive loss, but mustered a 0.4% gain. According to the CRB,
commodities are up almost 12% year-to-date.
On a related note, the
Consumer Price Index increased 0.1%, as did core CPI. Participants were prepped
for a soft reading in the wake of yesterday's PPI data, so the latest
installment of inflation data didn't provoke much of a reaction.
Despite a rather sloppy close,
health care stocks were able to climb 2.1% to log some of the best gains for
the second straight session. Consumer staples (+0.5%), discretionary stocks
(+1.0%), and tech (+0.6%) were also able to advance. Tech's heavy presence in
the Nasdaq actually helped the index outperform the other headline indices.
DJ30 -7.49 NASDAQ +11.88 NQ100 +0.9% R2K +0.7% SP400 +0.0% SP500 -1.26 NASDAQ
Adv/Vol/Dec 1390/2.54 bln/1260 NYSE Adv/Vol/Dec 1264/1.32 bln/1732