Ooouch! Stocks Fall Sharply Following GE Results Friday April 11, 5:37 pm ET By Tim Paradis, AP Business Writer Wall Street Sells Off After Disappointing GE Profits; Consumer Sentiment Reading Shows Unease NEW YORK (AP) -- Wall Street stumbled Friday after a disappointing first-quarter report from General Electric Co. surprised the market and stoked concern about the health of both corporate profits and the wider economy. The major indexes fell more than 2 percent, with the Dow Jones industrials giving up more than 250 points. ADVERTISEMENT A weaker-than-expected reading showing consumer confidence at a 26-year low subdued any positive sentiment. GE, which is regarded as a bellwether of big business, said its financial-services divisions have been challenged by the slowing U.S. economy and difficult capital markets. The company, whose orbit extends into entertainment, consumer and industrial manufacturing, finance and health care, also lowered its projections for the entire year. The conglomerate is one of the early companies to post first-quarter results and its shortfall stirred worries that others still to report will paint a similarly dreary picture. The smaller-than-expected profits from GE injected anxiety into a market that earlier this week saw disappointing results from aluminum producer Alcoa Inc. and a warning from chip maker Advanced Micro Devices Inc. "The market really is focusing on the extent to which problems in the credit markets are spilling over into the real economy," said Brian Gendreau, investment strategist for ING Investment Management in New York. The Dow fell 256.56, or 2.04 percent, to 12,325.42. GE was by far the steepest decliner among the 30 stocks that comprise the Dow. Its shares dropped $4.70, or 13 percent, to $32.05. Broader stock indicators also registered sizable losses. The Standard & Poor's 500 index fell 27.72, or 2.04 percent, to 1,332.83, and the Nasdaq composite index fell 61.46, or 2.6 percent, to 2,290.24. The Russell 2000 index of smaller companies fell 19.26, or 2.72 percent, to 688.16. Declining issues outnumbered advancers by more than 3 to 1 on the New York Stock Exchange, where consolidated volume came to 3.59 billion shares compared with 3.60 billion shares traded Thursday. Friday's pullback followed a comparatively quiet week in which the major indexes showed modest adjustments. Stocks were little changed Monday, declined Tuesday following profit warnings from names like United Parcel Service Inc. and posted moderate gains Thursday following a drop in unemployment claims. For the week, the Dow lost 2.3 percent, the S&P 500 declined 2.7 percent and the technology-heavy Nasdaq gave up 3.4 percent. Bond prices rose Friday as investors fearful of a slowing economy took up defensive positions in government debt. The yield on the benchmark 10-year Treasury note, which moves opposite its price, fell to 3.48 percent in late trading from 3.55 percent late Thursday. Light, sweet crude rose 3 cents to settle at $110.14 per barrel on the New York Mercantile Exchange. The dollar was mixed against other major currencies, while gold prices fell. A snapshot of a gloomy consumer added to recent reports showing Americans' confidence in the economy at new lows, dragged down by worries about mounting job losses, record-high home foreclosures and zooming energy prices. Investors fear that nervous shoppers will be less willing to reach into their wallets -- an unwelcome prospect as consumer spending accounts for about 70 percent of U.S. economic activity. The preliminary Reuters/University of Michigan index of consumer sentiment fell to 63.2 for April -- its lowest point since 1982 -- from 69.5 in March, according to Dow Jones Newswires. Economists polled by Thomson/IFR had, on average, expected a reading of 68. "I think rationality is coming into the market," said Alan Lancz, director at investment research group LanczGlobal in Toledo, Ohio. "Every time we move up to test the upper end of the range, something seems to happen." He noted that even if the most onerous times for the financial sector have passed, as some market watchers have said, the effects of a tight credit market will be felt for some time. Lancz said GE's results offer new evidence that forecasts for corporate profits in general remain too rosy given the troubles hitting businesses. "They're facing a lot of headwinds that I don't think a lot of analysts have put into their numbers," he said. Lancz contends that the Federal Reserve's moves last month to head off the collapse of Bear Stearns Cos. no doubt helped stabilize Wall Street -- but might have led some investors to become complacent about the scope of the troubles still facing the economy. Linda Duessel, a market strategist at Federated Investors in Pittsburgh, noted that GE is known for its dependability in meeting Wall Street's forecasts, and the nearly 6 percent drop in its profits suggest that other first-quarter results next week could reveal weakness well beyond the financial industry. "In the fourth quarter of last year the financials continued to tell us bad news and the rest of the sectors hung in extremely well," she said, adding that investors are now worried the weakness has spread. "That company is known for being kind of a window to the market and the economy," she said of GE. In other corporate news, Frontier Airlines Holdings Inc. filed for Chapter 11 bankruptcy protection. Unlike the three other airlines that have filed for bankruptcy in as many weeks, the carrier plans to keep operating while it reorganizes. Frontier ended down $1.09, or 69 percent, at 48 cents. Overseas, Japan's Nikkei stock average rose 2.92 percent. Britain's FTSE 100 closed down 1.17 percent, Germany's DAX index fell 1.50 percent, and France's CAC-40 finished off 1.27 percent. The Dow Jones industrial average ended the week down 284.00, or 2.25 percent, at 12,325.42. The Standard & Poor's 500 index finished down 37.57, or 2.74 percent, at 1,332.83. The Nasdaq composite index ended the week down 80.74, or 3.41 percent, at 2,290.24. The Russell 2000 index finished the week down 25.57, or 3.58 percent, at 688.16. The Dow Jones Wilshire 5000 Composite Index -- a free-float weighted index that measures 5,000 U.S. based companies -- ended Friday at 13,455.24, down 368.56 points, or 2.67 percent, for the week. A year ago, the index was at 14,593.06.
<table><tr><td>Date </td><td></td><td>Action</td><td></td><td>Price</td><td></td><td>P/L</td><td></tr/><tr><td>FEB 19:</td><td></td><td>SELL</td><td></td><td>@44.35</td><td></td><td> Start</td></tr><tr><td>FEB 22:</td><td> </td><td> BUY</td><td></td><td>@43.46</td><td></td><td>+0.89</td></tr><tr><td>MAR 13:</td><td></td><td> SELL</td><td></td><td>@43.00 </td><td></td><td>(-0.46)</td></tr><tr><td>MAR 19:</td><td></td><td> BUY</td><td></td><td>@42.32 </td><td></td><td>+0.68</td></tr><tr><td>MAR 24:</td><td></td><td> SELL</td><td></td><td>@44.68 </td><td></td><td>+2.36</td></tr><tr><td>MAR 25:</td><td></td><td> BUY</td><td></td><td>@44.82 </td><td></td><td>(-0.14)</td></tr><tr><td>MAR 26:</td><td></td><td> SELL</td><td></td><td>@44.67 </td><td></td><td>(-0.15)</td></tr><tr><td>APR 8:</td><td></td><td> BUY</td><td></td><td>@45.41 </td><td></td><td>(-0.74)</td></tr><tr><td>APR 10:</td><td></td><td> SELL</td><td></td><td>@45.56 </td><td></td><td>+0.15</td></tr><tr><td>APR 14:</td><td></td><td> BUY</td><td></td><td>@44.08 </td><td></td><td>+1.48</td></tr></table>
While QQQQ is down a fraction less than two months since my first post on Feb 19, the model is up 4 points!
Just covered this baby today. Profits were more than $1.50 (reason Qs went down by $1.45 and time value went also down significantly).
<table><tr><td>Date </td><td></td><td>Action</td><td></td><td>Price</td><td></td><td>P/L</td><td></tr/><tr><td>FEB 19:</td><td></td><td>SELL</td><td></td><td>@44.35</td><td></td><td> Start</td></tr><tr><td>FEB 22:</td><td> </td><td> BUY</td><td></td><td>@43.46</td><td></td><td>+0.89</td></tr><tr><td>MAR 13:</td><td></td><td> SELL</td><td></td><td>@43.00 </td><td></td><td>(-0.46)</td></tr><tr><td>MAR 19:</td><td></td><td> BUY</td><td></td><td>@42.32 </td><td></td><td>+0.68</td></tr><tr><td>MAR 24:</td><td></td><td> SELL</td><td></td><td>@44.68 </td><td></td><td>+2.36</td></tr><tr><td>MAR 25:</td><td></td><td> BUY</td><td></td><td>@44.82 </td><td></td><td>(-0.14)</td></tr><tr><td>MAR 26:</td><td></td><td> SELL</td><td></td><td>@44.67 </td><td></td><td>(-0.15)</td></tr><tr><td>APR 8:</td><td></td><td> BUY</td><td></td><td>@45.41 </td><td></td><td>(-0.74)</td></tr><tr><td>APR 10:</td><td></td><td> SELL</td><td></td><td>@45.56 </td><td></td><td>+0.15</td></tr><tr><td>APR 14:</td><td></td><td>BUY</td><td></td><td>@44.08</td><td></td><td>+1.48</td></tr><tr><td>APR 16:</td><td></td><td>SELL</td><td></td><td>@45.36</td><td></td><td>+1.28</td></tr></table>
Wall Street surges higher after upbeat earnings reports Wednesday April 16, 5:54 pm ET By Joe Bel Bruno, AP Business Writer Stocks stage big rally after earnings from Intel, JPMorgan, Coca-Cola ease profit anxiety NEW YORK (AP) -- Wall Street rallied Wednesday after better-than-expected quarterly results from JPMorgan Chase and two other Dow Jones industrials raised investors' hopes that companies and the economy are indeed recovering from the protracted global credit crisis. The Dow rose more than 250 points as investors shrugged off any concerns about oil passing $115 a barrel for the first time. ADVERTISEMENT A market anxious about corporate earnings and their effect on the economy was relieved after JPMorgan Chase & Co., Coca-Cola Co. and Intel Corp. all topped first-quarter projections. The three companies are among dozens posting quarterly results Wednesday. The battered financial sector advanced after JPMorgan beat analysts' expectations despite a 50 percent drop in quarterly profit. The nation's third-biggest bank, which is in the process of acquiring ailing Bear Stearns Cos., reported $2.6 billion of write-downs tied to its loan portfolio. "You have a combination of JPMorgan and all these other strong earnings out there from a broad range sectors, and that's helping the buying we're seeing," said Todd Salamone, director of trading and vice president of research at Schaeffer's Investment Research. "There's an unwinding of all the negativity that we saw ahead of the earnings season." Salamone and other analysts have been hoping that strength in corporate earnings would act as a catalyst for a significant rally; the market has managed a choppy ascent since hitting lows in early March. Investors have been growing more confident in recent weeks that the Federal Reserve's efforts to boost the economy and the troubled credit markets are working. Wednesday's earnings reports bolstered that sentiment. Along with earnings results, Wall Street weighed sluggish economic reports on inflation and housing that were mostly within expectations. The Federal Reserve also released its Beige Book report, an outline of regional economic activity that pointed to widespread weakening amid a softening labor market. But neither those factors nor a new trading high of $115.07 for a barrel of oil on the New York Mercantile Exchange damped the market rally. Oil prices rose after a government report showed crude inventories fell unexpectedly last week, the second straight weekly decline. Light, sweet crude settled up $1.14 at a record $114.93 a barrel on the Nymex. The Dow rose 256.80, or 2.08 percent, to 12,619.27. The index is up nearly 900 points from a low near 11,740, reached March 10. Broader market indexes also gained. The Standard & Poor's 500 index rose 30.28, or 2.27 percent, to 1,364.71; and the Nasdaq composite index advanced 64.07, or 2.80 percent, to 2,350.11. The Russell 2000 index of smaller companies rose 21.33, or 3.1 percent, to 713.39. Bond prices fell as stocks looked more attractive. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose to 3.71 percent from 3.57 percent late Tuesday. Gold prices rose, and the dollar was mostly lower against other major currencies. "The market has been worried about the U.S. consumer being flat on his back for some time and the high price of oil feeds into that," said Kevin Gaughan, portfolio manager and equity strategist at Wells Capital Management in Milwaukee. He suggested investors who had been myopically focusing on the U.S. consumer are rotating back to a more global view, and looking toward expanding markets overseas. "The oil thing is certainly a global constraint on consumer spending, but you have so many more consumers coming into the marketplace via Asia and other places, the numbers there are a huge offset," Gaughan said. In fact, Coca-Cola credited overseas growth with boosting its first-quarter profit 19 percent, despite weak results in North America. Coca-Cola shares rose 21 cents to $61.15 after its results came in well ahead of Wall Street expectation. JPMorgan rose $2.84, or 6.7 percent, to $44.96 after issuing its quarterly report. Chief Executive Jamie Dimon said the bank is well capitalized and has enough liquidity to handle difficult market conditions, but he did not call an end to the credit crisis as some other bank CEOs have in recent weeks. Dow component Bank of America Corp. rose $1.40, or 3.9 percent, to $36.98, while Wells Fargo Corp., which also beat earnings expectations, rose $1.20, or 4.3 percent, to $29.01. "We got a nice rally here and that's because of the financials, they are holding their gains," said Todd Leone, managing director of equity trading at Cowen & Co. "They have helped out the market and are a real driver." Intel, another Dow stock, rose $1.22, or 5.8 percent, to $22.13 after reporting late Tuesday that quarterly profit matched analysts' expectations and sales topped projections. Intel also issued a forecast that kept profit-margin predictions for 2008 intact. Wall Street had little reaction to a new batch of disappointing economic data; many investors have already tempered their expectations about the economy. Government data showed that consumer inflation pushed higher last month as increases in energy, food and airline tickets overwhelmed the biggest drop in clothing prices in nearly a decade. The Labor Department reported consumer prices rose 0.3 percent in March after being unchanged in February. Core inflation, which excludes food and energy prices, posted a 0.2 percent rise. Both the overall increase and the rise in core prices were in line with analysts' expectations. Meanwhile, home construction plummeted during March to its lowest level in 17 years, the government said in a report signaling that the housing sector will continue slumping. Housing starts fell 11.9 percent to a seasonally adjusted 947,000 annual rate, after falling 0.7 percent in February to 1.075 million, according to the Commerce Department. Advancing issues led decliners by a 5 to 1 basis on the New York Stock Exchange, where volume came to 4.1 billion shares compared with 3.49 billion shares traded Tuesday. Overseas, Japan's Nikkei stock average rose 1.20 percent. Britain's FTSE 100 rose 2.36 percent, Germany's DAX index was up 1.79 percent, and France's CAC-40 added 1.56 percent.