Showing posts with label Business. Show all posts
Showing posts with label Business. Show all posts

Cuts imminent, Senate Democrats, GOP stage votes


WASHINGTON (AP) — Squabbling away the hours, the Senate moved toward certain defeat of last-minute plans to avoid $85 billion in broad-based spending reductions Thursday as the two political parties blamed each other for the latest outbreak of gridlock and the Obama administration readied plans to put the cuts into effect.


The immediate impact was uncertain as the administration pulled back on its earlier warnings of long lines developing quickly at airports and teacher layoffs affecting classrooms. But there was no doubt about the outcome of back-to-back votes on the Senate floor.


There, a Republican plan requiring Obama to propose an alternative package of $85 billion in cuts faced rejection at the hands of Democrats.


And, just as surely, a Democratic proposal to spread the cuts over a decade and replace half of them with higher taxes on millionaires and corporations headed for defeat at Republican hands.


"We have the opportunity to avoid the kind of calamity and disaster that is being threatened and is completely unnecessary," said Sen. Pat Toomey of Pennsylvania, who co-authored the Republican proposal.


"The question is, are we going to achieve these savings through badly designed spending cuts that make no attempt whatever to distinguish between more sensible government spending and less sensible spending?"


Sen. Patty Murray of Washington said that sensible distinguishing was precisely what Democrats had tried to do by proposing the deferral of Pentagon cuts until U.S. combat troops have come home from Afghanistan in two years' time.


At the same time, she said the Democrats had reasonably proposed replacing half of the pending cuts with higher taxes on "the wealthiest Americans and biggest corporations."


Across the Capitol, House Speaker John Boehner led the chorus of Republican critics, saying that "Obama and Senate Democrats are demanding more tax hikes to fuel more 'stimulus' spending."


In fact, the Democratic measure included small increases in funding for a variety of small programs such as biodiesel education, assistance for biomass crops and certification of organic foods.


With no last-minute plans to seek a delay in the looming cuts, Obama invited Boehner and the other top leaders of Congress to a White House meeting on the subject on Friday.


It was not clear whether he would seek negotiations to replace the across-the-board cuts before they begin to bite.


But already, some Republicans held out hope the current struggle might lead to talks on completing work on the final piece of a deficit reduction package that has been more than two agonizing years in the making.


"The objective here ought to be not just to deal with sequester but to deal with the underlying spending problems, which require tax reform" as well as reform of benefit programs like Medicare, Medicaid and Social Security," said Sen. Rob Portman, R-Ohio.


In a cycle of crisis followed by compromise over the past two years, Obama and congressional Republicans have agreed to more than $3.6 trillion in long-term deficit savings over a decade. While much of that has come from spending restraint, the GOP let legislation pass late last year that raises taxes on upper-income Americans by $600 million.


None of the savings to date has come from the big benefit programs that lawmakers in both parties say must be tackled if the country is to gain control over its finances. Each party fears the political fallout of confronting them on their own, but Democrats, in particular, are reluctant to scale back programs that they count as their political birthright.


Their rival speeches on the Senate floor weren't the first time that Toomey and Murray disagreed on economic issues.


Both served on a so-called congressional Supercommittee in 2011 that was charged with producing at least $1.2 trillion in savings over a decade.


The panel deadlocked, automatically triggering the across-the-board cuts that now are imminent.


As constituted, the cuts would total $85 billion through the end of the current budget year — Sept. 30 — half each from defense and non-defense programs. Large parts of the budget are off-limits, including programs for veterans, Social Security and Medicare benefits.


The Republican alternative would require Obama to propose an alternative that relied exclusively on spending cuts, ruled out tax increases and limited what he could take from Pentagon accounts. Congress could reject his new approach, but under the alternative, his recommendations would be likely to take effect.


The Democratic measure would have canceled the $85 billion in cuts, and replaced them with a combination of tax increases and cuts to defense and farm programs that would phase in over a decade. Under that plan, deficits would rise by more $42 billion in the first year and $38 billion over the two following years before gradually beginning to decline.


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Wall Street climbs 1 percent on Bernanke, economic data

NEW YORK (Reuters) - Stocks rose 1 percent on Wednesday, erasing much of the week's losses as Federal Reserve Chairman Ben Bernanke remained steadfast in his support of the Fed's stimulus policy and data pointed to economic improvement.


In his second day before a congressional committee, Bernanke repeated testimony in which he defended the Fed's policy of buying bonds to keep interest rates low in order to promote growth and bring down the unemployment rate.


The remarks helped the market rebound from its worst decline since November and put the S&P 500 back above 1,500, a closely watched level that has been technical support until recently.


The comments also seemed to remove a headwind from markets that last week contributed to equities breaking a seven-week streak of gains on concerns the quantitative easing program may end earlier than had been anticipated.


"The Fed continues to encourage risk-taking in markets, which is a powerful tool that makes the danger not being long stocks, not in being too long," said Tom Mangan, a money manager at James Investment Research Inc in Xenia, Ohio.


Adding to the positive tone was economic data which showed a gauge of planned U.S. business spending in January recorded its largest increase in just over a year, while contracts to buy new homes neared a three-year high last month.


The S&P 500 had climbed 6 percent for the year and came within reach of all-time highs before pulling back on concerns about Fed policy, as well as this week's inconclusive elections in Italy, which rekindled fears of a new euro zone debt crisis.


The Dow Jones industrial average <.dji> was up 140.76 points, or 1.01 percent, at 14,040.89. The Standard & Poor's 500 Index <.spx> was up 16.15 points, or 1.08 percent, at 1,513.09. The Nasdaq Composite Index <.ixic> was up 33.56 points, or 1.07 percent, at 3,163.21.


The S&P is down 0.2 percent on the week, recovering from a plunge on Monday that was the index's biggest daily drop since November. That drop came on concerns over Italy's election, as well as over sequestration - U.S. government budget cuts that will take effect starting on Friday if lawmakers fail to reach an agreement on spending and taxes.


"While the rally remains intact and there are reasons to be long-term bullish here, there are also reasons to not be surprised if we get a correction," said Mangan, who helps oversee $3.7 billion. Issues like the sequester and Europe "could mean that this ends up being a more difficult year for equities."


In earnings news, Priceline.com gained 3.4 percent to $702 after reporting adjusted earnings that beat expectations. TJX Cos Inc jumped 1.7 percent to $44.40 after the retail chain operator posted higher fourth-quarter results.


The S&P retail index <.spxrt> climbed 1.6 percent.


Target Corp appeared poised for a solid showing in the first quarter and forecast a higher profit for the full year after a weak performance in the key holiday season. The stock dipped 1.1 percent to $63.32.


With 93 percent of the S&P 500 companies having reported results so far, 69.5 percent beat profit expectations, compared with a 62 percent average since 1994 and 65 percent over the past four quarters, according to Thomson Reuters data.


Fourth-quarter earnings for S&P 500 companies are estimated to have risen 6.2 percent, according to the data, above a 1.9 percent forecast at the start of the earnings season.


(Editing by Nick Zieminski)



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Wall Street rebounds as Bernanke defends policy

NEW YORK (Reuters) - Stocks climbed on Tuesday, rebounding from their worst decline since November after Federal Reserve Chairman Ben Bernanke defended the Fed's bond-buying stimulus before Congress.


Bernanke, in testimony before the Senate Banking Committee, strongly defended the Fed's bond-buying stimulus program and quieted rumblings that the central bank may pull back from its stimulative policy measures, which were sparked by the release of the Fed minutes last week.


Bernanke's testimony helped ease concerns about a stalemate in Italy after a general election failed to give any party a parliamentary majority, posing the threat of prolonged instability and financial crisis in Europe, and sending the S&P 500 to its worst decline since early November in the previous sessions.


Bernanke "certainly said everything the market needed to feel in order to get comfortable again," said Peter Kenny, managing director at Knight Capital in Jersey City, New Jersey.


"The fear is we were going to see a rollover, and the first shot over the bow was what we saw out of Italy yesterday with the elections," Kenny said. "When it came to U.S. markets, we saw some of that bleeding stop because our focus shifted from the Italian political circus to Ben Bernanke."


Gains in homebuilders and other consumer stocks, following strong economic data, lifted the S&P 500 and a 5.6 percent jump in Home Depot to $67.38 boosted the Dow industrials. The PHLX housing sector index <.hgx> rose 3.3 percent.


However, the central bank chairman also urged lawmakers to avoid sharp spending cuts set to go into effect on Friday, which he warned could combine with earlier tax increases to create a "significant headwind" for the economic recovery.


The Dow Jones industrial average <.dji> climbed 109.04 points, or 0.79 percent, to 13,893.21. The Standard & Poor's 500 Index <.spx> gained 8.96 points, or 0.60 percent, to 1,496.81. The Nasdaq Composite Index <.ixic> advanced 13.46 points, or 0.43 percent, to 3,129.71.


Despite the bounce, the S&P 500 also failed to move above 1,500, a closely watched level that was technical support until recently, but it could now become a hurdle.


The uncertainty caused by the Italian elections continues to weigh on stocks in Europe. The FTSEurofirst-300 index of top European shares <.fteu3> closed down 1.4 percent. The benchmark Italian index <.ftmib> tumbled 4.9 percent.


Home Depot gave the biggest boost to the Dow and provided one of the biggest lifts to the S&P 500 after the world's largest home improvement chain reported adjusted earnings and sales that beat expectations. The stock climbed 5.6 percent to $67.47.


Macy's shares gained 3.6 percent to $39.90 after the department-store chain stated it expects full-year earnings to be above analysts' forecasts because of strong holiday sales.


Economic reports that showed strength in housing and consumer confidence also supported stocks. U.S. home prices rose more than expected in December, according to the S&P/Case-Shiller index. Consumer confidence rebounded in February, jumping more than expected, and new-home sales rose to their highest in 4-1/2 years.


(Reporting by Chuck Mikolajczak; Editing by Jan Paschal)



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Wall Street drops on Italian election uncertainty

NEW YORK (Reuters) - Stocks fell on Monday, reversing course from earlier gains as elections in Italy stoked concerns a divided parliament could disrupt the country's fiscal reforms and the euro zone's stability.


Early forecasts of the results were conflicting, as opinion polls indicated the center-left of Pier Luigi Bersani winning the lower house, but projections from RAI state television showed Silvio Berlusconi's center right in front in the Senate - which has equal lawmaking power - but unable to form a majority.


The resulting gridlock in parliament could force new elections and sent the euro currency lower against both the dollar and yen.


"Most likely we are looking at a second election, so it's delayed, but at the margin it is a negative," said Tim Ghriskey, chief investment officer of Solaris Group in Bedford Hills, New York.


"The question is, what happens with Italy and that uncertainty is out there, that is really what you've seen in the sell-off here."


Earlier polls pointing to a center-left victory boosted stocks in Milan and other European markets, as well as helping to lift the S&P 500 to a session high of 1,525.84 on optimism Italy would continue to pay down its debt.


However, the benchmark S&P index remained near highs not seen in five years, as bets on a stronger U.S. economy have given equities support. The S&P 500's slight fall last week was the first weekly drop after a seven-week string of gains to start the year.


Banks and other financial stocks were among the worst performers on worries about the sector's exposure to Italy's massive debt. The KBW Bank Index <.bkx> fell 1.1 percent.


The Dow Jones industrial average <.dji> dropped 92.14 points, or 0.66 percent, to 13,908.43. The Standard & Poor's 500 Index <.spx> dropped 11.65 points, or 0.77 percent, to 1,503.95. The Nasdaq Composite Index <.ixic> dropped 12.65 points, or 0.40 percent, to 3,149.17.


Barnes & Noble Inc shares jumped 10.6 percent to $14.94 after the bookseller's chairman offered to buy its declining retail business.


The Nasdaq received support from Amgen Inc , up 4.9 percent at $91.03, after rival Affymax issued a voluntary recall of its only drug, an anemia treatment that competes with Amgen's top-selling red blood cell booster, Epogen. Affymax shares slumped 84.6 percent to $2.55.


The FTSEurofirst-300 index of top European shares <.fteu3> unofficially closed up 0.04 percent and Italy's main FTSE MIB <.ftmib> ended up 0.7 percent after earlier gaining near 4 percent.


U.S. equities will face a test with the looming debate over so-called sequestration, U.S. government budget cuts that will take effect starting on Friday if lawmakers fail to reach an agreement over spending and taxes. The White House issued warnings about the harm the cuts are likely to inflict on the economy if enacted.


"Sitting out there is the one thousand pound gorilla - the sequester issue - and certainly nothing is happening there," Ghriskey said.


Lowe's Companies Inc lost 1.6 percent to $37.08 after the home improvement retailer posted fourth-quarter earnings.


With 83 percent of the S&P 500 companies having reported results so far, 69 percent beat profit expectations, compared with a 62 percent average since 1994 and 65 percent over the past four quarters, according to Thomson Reuters data.


Fourth-quarter earnings for S&P 500 companies are estimated to have risen 6 percent, according to the data, above a 1.9 percent forecast at the start of the earnings season.


(Editing by Kenneth Barry, Jan Paschal and Nick Zieminski)



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Investors face another Washington deadline

NEW YORK (Reuters) - Investors face another Washington-imposed deadline on government spending cuts next week, but it's not generating the same level of fear as two months ago when the "fiscal cliff" loomed large.


Investors in sectors most likely to be affected by the cuts, like defense, seem untroubled that the budget talks could send stocks tumbling.


Talks on the U.S. budget crisis began again this week leading up to the March 1 deadline for the so-called sequestration when $85 billion in automatic federal spending cuts are scheduled to take effect.


"It's at this point a political hot button in Washington but a very low level investor concern," said Fred Dickson, chief market strategist at D.A. Davidson & Co. in Lake Oswego, Oregon. The fight pits President Barack Obama and fellow Democrats against congressional Republicans.


Stocks rallied in early January after a compromise temporarily avoided the fiscal cliff, and the Standard & Poor's 500 index <.spx> has risen 6.3 percent since the start of the year.


But the benchmark index lost steam this week, posting its first week of losses since the start of the year. Minutes on Wednesday from the last Federal Reserve meeting, which suggested the central bank may slow or stop its stimulus policy sooner than expected, provided the catalyst.


National elections in Italy on Sunday and Monday could also add to investor concern. Most investors expect a government headed by Pier Luigi Bersani to win and continue with reforms to tackle Italy's debt problems. However, a resurgence by former leader Silvio Berlusconi has raised doubts.


"Europe has been in the last six months less of a topic for the stock market, but the problems haven't gone away. This may bring back investor attention to that," said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.


OPTIONS BULLS TARGET GAINS


The spending cuts, if they go ahead, could hit the defense industry particularly hard.


Yet in the options market, bulls were targeting gains in Lockheed Martin Corp , the Pentagon's biggest supplier.


Calls on the stock far outpaced puts, suggesting that many investors anticipate the stock to move higher. Overall options volume on the stock was 2.8 times the daily average with 17,000 calls and 3,360 puts traded, according to options analytics firm Trade Alert.


"The upside call buying in Lockheed solidifies the idea that option investors are not pricing in a lot of downside risk in most defense stocks from the likely impact of sequestration," said Jared Woodard, a founder of research and advisory firm condoroptions.com in Forest, Virginia.


The stock ended up 0.6 percent at $88.12 on Friday.


If lawmakers fail to reach an agreement on reducing the U.S. budget deficit in the next few days, a sequester would include significant cuts in defense spending. Companies such as General Dynamics Corp and Smith & Wesson Holding Corp could be affected.


General Dynamics Corp shares rose 1.2 percent to $67.32 and Smith & Wesson added 4.6 percent to $9.18 on Friday.


EYES ON GDP DATA, APPLE


The latest data on fourth-quarter U.S. gross domestic product is expected on Thursday, and some analysts predict an upward revision following trade data that showed America's deficit shrank in December to its narrowest in nearly three years.


U.S. GDP unexpectedly contracted in the fourth quarter, according to an earlier government estimate, but analysts said there was no reason for panic, given that consumer spending and business investment picked up.


Investors will be looking for any hints of changes in the Fed's policy of monetary easing when Fed Chairman Ben Bernake speaks before congressional committees on Tuesday and Wednesday.


Shares of Apple will be watched closely next week when the company's annual stockholders' meeting is held.


On Friday, a U.S. judge handed outspoken hedge fund manager David Einhorn a victory in his battle with the iPhone maker, blocking the company from moving forward with a shareholder vote on a controversial proposal to limit the company's ability to issue preferred stock.


(Additional reporting by Doris Frankel; Editing by Kenneth Barry)



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Investors face another Washington deadline

NEW YORK (Reuters) - Investors face another Washington-imposed deadline on government spending cuts next week, but it's not generating the same level of fear as two months ago when the "fiscal cliff" loomed large.


Investors in sectors most likely to be affected by the cuts, like defense, seem untroubled that the budget talks could send stocks tumbling.


Talks on the U.S. budget crisis began again this week leading up to the March 1 deadline for the so-called sequestration when $85 billion in automatic federal spending cuts are scheduled to take effect.


"It's at this point a political hot button in Washington but a very low level investor concern," said Fred Dickson, chief market strategist at D.A. Davidson & Co. in Lake Oswego, Oregon. The fight pits President Barack Obama and fellow Democrats against congressional Republicans.


Stocks rallied in early January after a compromise temporarily avoided the fiscal cliff, and the Standard & Poor's 500 index <.spx> has risen 6.3 percent since the start of the year.


But the benchmark index lost steam this week, posting its first week of losses since the start of the year. Minutes on Wednesday from the last Federal Reserve meeting, which suggested the central bank may slow or stop its stimulus policy sooner than expected, provided the catalyst.


National elections in Italy on Sunday and Monday could also add to investor concern. Most investors expect a government headed by Pier Luigi Bersani to win and continue with reforms to tackle Italy's debt problems. However, a resurgence by former leader Silvio Berlusconi has raised doubts.


"Europe has been in the last six months less of a topic for the stock market, but the problems haven't gone away. This may bring back investor attention to that," said Kim Forrest, senior equity research analyst at Fort Pitt Capital Group in Pittsburgh.


OPTIONS BULLS TARGET GAINS


The spending cuts, if they go ahead, could hit the defense industry particularly hard.


Yet in the options market, bulls were targeting gains in Lockheed Martin Corp , the Pentagon's biggest supplier.


Calls on the stock far outpaced puts, suggesting that many investors anticipate the stock to move higher. Overall options volume on the stock was 2.8 times the daily average with 17,000 calls and 3,360 puts traded, according to options analytics firm Trade Alert.


"The upside call buying in Lockheed solidifies the idea that option investors are not pricing in a lot of downside risk in most defense stocks from the likely impact of sequestration," said Jared Woodard, a founder of research and advisory firm condoroptions.com in Forest, Virginia.


The stock ended up 0.6 percent at $88.12 on Friday.


If lawmakers fail to reach an agreement on reducing the U.S. budget deficit in the next few days, a sequester would include significant cuts in defense spending. Companies such as General Dynamics Corp and Smith & Wesson Holding Corp could be affected.


General Dynamics Corp shares rose 1.2 percent to $67.32 and Smith & Wesson added 4.6 percent to $9.18 on Friday.


EYES ON GDP DATA, APPLE


The latest data on fourth-quarter U.S. gross domestic product is expected on Thursday, and some analysts predict an upward revision following trade data that showed America's deficit shrank in December to its narrowest in nearly three years.


U.S. GDP unexpectedly contracted in the fourth quarter, according to an earlier government estimate, but analysts said there was no reason for panic, given that consumer spending and business investment picked up.


Investors will be looking for any hints of changes in the Fed's policy of monetary easing when Fed Chairman Ben Bernake speaks before congressional committees on Tuesday and Wednesday.


Shares of Apple will be watched closely next week when the company's annual stockholders' meeting is held.


On Friday, a U.S. judge handed outspoken hedge fund manager David Einhorn a victory in his battle with the iPhone maker, blocking the company from moving forward with a shareholder vote on a controversial proposal to limit the company's ability to issue preferred stock.


(Additional reporting by Doris Frankel; Editing by Kenneth Barry)



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Wall Street drops again, data raises growth concerns

NEW YORK (Reuters) - U.S. stocks fell on Thursday and were on track for their biggest two-day decline since November as weak data suggested expectations for economic growth were overly optimistic.


The two-day decline marked the U.S. stock market's first sustained pullback this year. The Standard & Poor's 500 is up 5.2 percent so far this year. The benchmark index has climbed for seven straight weeks, putting it near five-year highs.


In the latest economic data, initial claims for unemployment benefits rose more than expected last week while the Federal Reserve Bank of Philadelphia said its index of business conditions in the U.S. mid-Atlantic region fell in February to minus 12.5, the lowest in eight months.


"The Philly Fed report was troublingly weak, and adds to concerns about whether growth will remain up," said Brad Sorensen, director of market and sector analysis at Charles Schwab in Denver. "The only growth we're seeing is sluggish."


On Wednesday, the S&P 500 and the Nasdaq posted their worst daily declines of the year after the minutes from the Federal Reserve's most recent meeting sparked concerns that the central bank may rein in its economic stimulus measures.


"The upside momentum in markets appears to be coming to an end as we consolidate recent gains," said Adam Sarhan, chief executive at Sarhan Capital in New York. "If the S&P breaks under its 50-day moving average, something more serious could be in store."


The S&P 500 would need to fall 1.9 percent to reach that level of 1,473.58.


Other reports showed consumer prices were flat in January while existing-home sales edged higher and left the inventory of homes at the lowest level in 13 years.


Wal-Mart Stores Inc shares gained 2.5 percent to $70.94 and helped curb the Dow's decline after the world's largest retailer reported earnings that beat expectations, though early February sales were sluggish.


The Dow Jones industrial average <.dji> was down 70.03 points, or 0.50 percent, at 13,857.51. The Standard & Poor's 500 Index <.spx> was down 11.23 points, or 0.74 percent, at 1,500.72. The Nasdaq Composite Index <.ixic> was down 36.50 points, or 1.15 percent, at 3,127.92.


The benchmark S&P 500 index has dropped 1.9 percent over the past two sessions, the biggest two-day decline since November.


Wall Street will soon face another test with the upcoming debate in Washington over the automatic across-the-board spending cuts put in place as part of a larger congressional budget fight. Those cuts, set to kick in on March 1 unless lawmakers agree on an alternative, are expected to depress economic growth.


Semiconductor stocks ranked among the weakest of the day, pressuring the Nasdaq as the Philadelphia Semiconductor index <.sox> fell 1.8 percent. Intel Corp fell 2.2 percent to $20.27 while Advanced Micro Devices lost 4.8 percent to $2.57 as the S&P's biggest percentage decliner.


The semiconductor sector has performed well so far in 2013, rising 8.4 percent.


In company news, shares of supermarket operator Safeway Inc jumped 13.4 percent to $22.83 and ranked as the S&P 500's top percentage gainer after the company reported earnings that beat expectations.


In contrast, shares of VeriFone Systems Inc tumbled nearly 40 percent to $19.28 after the credit-card swipe machine maker forecast first- and second-quarter profits well below expectations.


Of the 427 companies in the S&P 500 that have reported results so far, 69.3 percent have exceeded analysts' expectations, compared with a 62 percent average since 1994 and 65 percent over the past four quarters, according to Thomson Reuters data through Thursday morning.


Fourth-quarter earnings for S&P 500 companies are estimated to have risen 5.9 percent, according to the data, above a 1.9 percent forecast at the start of the earnings season.


Berry Petroleum Co jumped 17.3 percent to $45.25 after oil and gas producer Linn Energy LLC said it would buy the company in an all-stock deal valued at $4.3 billion, including debt. Linn Energy shares advanced 1.9 percent to $37.33.


(Editing by Kenneth Barry and Jan Paschal)



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Wall Street drops as energy sector drags

NEW YORK (Reuters) - U.S. stocks fell on Wednesday, pressured by a drop in energy shares as investors found few reasons to buy equities following a rally that has propelled indexes close to all-time highs.


Stocks were volatile after minutes from the U.S. Federal Reserve suggested the central bank may have to slow or stop buying assets before seeing a pickup in hiring, raising the prospect of an earlier end to quantitative easing.


"What Wall Street wants to hear is an absolute sign that the Fed will continue with QE for the indefinite future. When it says we may end it faster, that just raises the uncertainty and the market hates that," said Todd Schoenberger, managing partner at Landcolt Capital in New York.


Energy companies' shares were among the weakest, hurt by disappointing results in the sector and a 2.3 percent drop in crude oil prices. The Energy Select Sector SPDR exchange-traded fund fell 1.2 percent.


The Dow Jones industrial average <.dji> slipped 36.65 points, or 0.26 percent, to 13,999.02. The Standard & Poor's 500 Index <.spx> dropped 9.50 points, or 0.62 percent, to 1,521.44. The Nasdaq Composite Index <.ixic> lost 24.63 points, or 0.77 percent, to 3,188.96.


In the energy sector, Newfield Exploration tumbled 7.7 percent to $25.19 while Devon Energy Corp dropped 4.6 percent to $57.75. Both companies posted fourth-quarter losses, with Devon hurt as it wrote down the value of its assets by $896 million because of weak natural gas prices.


Equities have been strong recently. The day's modest decline was the largest for the S&P 500 since February 4. The index has jumped about 7 percent so far this year and is on track for its eighth straight week of gains.


However, many of those weekly gains have been slight, with equities trading within a narrow range for the past few weeks, suggesting valuations may be stretched at current levels.


"The market seems very tired and listless, and investors are prone to take profits now as they wait for the music to stop," said Matt McCormick, money manager at Bahl & Gaynor in Cincinnati.


Earlier in the day, unconfirmed rumors that a troubled hedge fund was selling assets added some downward pressure to the market. The rumors appeared to be unfounded.


"I heard the chatter about a hedge fund liquidating things today but how big, I don't know. Certainly, it sparks concern," said Michael James, senior trader at Wedbush Morgan in Los Angeles.


Housing shares also declined, pressured by weaker-than-expected results at Toll Brothers Inc and a drop in groundbreaking to build new U.S. homes, also known as housing starts, in January.


Toll Brothers' stock fell 6.1 percent to $34.66, but is up about 7 percent so far this year, building on a jump of nearly 60 percent in 2012. The Dow Jones U.S. Home Construction index <.djushb> lost 4.3 percent.


"Valuations appear a bit high at these levels, and if I was in a name that had seen a huge run, I'd want to take some chips off the table," said McCormick, who helps oversee about $8.2 billion in assets.


The Dow's losses were limited by Boeing Co , up 1.2 percent at $75.56 after a source told Reuters that the company had found a way to fix battery problems on its grounded 787 Dreamliner jets. Concerns over that line have weighed on Boeing recently, contributing to a 2 percent drop in the stock's price in January.


In economic data released on Wednesday, permits for future home building rose in January to a 4 1/2-year high while a separate report showed wholesale prices rose last month for the first time in four months. The U.S. Producer Price Index rose in January for the first time in four months.


Shares of OfficeMax Inc fell 8.5 percent to $11.87 while Office Depot slid 18.5 percent to $4.09 as the companies announced a $1.2 billion merger agreement. The shares had surged in Tuesday's session after a source said a deal would be announced. Rival Staples Inc fell 5.5 percent to $13.84 and ranked as one of the S&P 500's biggest decliners.


According to Thomson Reuters data through Tuesday morning, of the 405 companies in the S&P 500 that have reported results so far, 71 percent have exceeded analysts' expectations, compared with a 62 percent average since 1994 and 65 percent over the past four quarters.


Fourth-quarter earnings for S&P 500 companies are estimated to have risen 5.7 percent, according to the data, exceeding a forecast for a 1.9 percent gain at the start of the earnings season.


(Additional Reporting by Ryan Vlastelica; Editing by Jan Paschal)



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Yen resumes fall after G20, U.S. holiday thins trade

LONDON (Reuters) - The yen resumed falling on Monday after Japan signaled it would push ahead with expansionist monetary policies having escaped criticism from the world's 20 biggest economies at the weekend.


Industrial metals also dipped and European shares were soft on lingering worries about the economic outlook, especially for the euro zone. While the risk of an inconclusive outcome in Italy's forthcoming election added to investor concerns.


However, activity was curtailed by the closure of markets in the United States for the Presidents' Day holiday.


The yen, which has dropped 20 percent against the dollar since mid-November, fell further after financial leaders from the G20 promised not to devalue their currencies to boost exports and avoided singling out Japan for any direct criticism.


The dollar rose 0.5 percent to 93.95 yen, near a 33-month peak of 94.47 yen set a week ago. The euro added 0.3 percent to 125.40 yen, to be midway between Friday's two-week low of 122.90 and a 34-month high of 127.71 yen hit earlier this month.


Strategists said the yen was likely to stay weak, though its decline could lose momentum until it becomes clear who will be taking the helm at the Bank of Japan when the current governor steps down on March 19.


"The yen probably will weaken a little further in anticipation of more aggressive easing under a new leadership team at the Bank of Japan," said Julian Jessop, chief global economist at Capital Economics.


Japan's Prime Minister Shinzo Abe is poised to nominate the new governor in the next few days. Sources have told Reuters that former financial bureaucrat Toshiro Muto, considered likely to be less radical than other candidates, was leading the field.


Meanwhile the euro dipped slightly against the dollar when European Central Bank president Mario Draghi said the currency's recent gains made any rise in inflation less likely and added that he had yet to see any improvement in the euro zone economy.


Speaking before the European Parliament, Draghi said the euro's exchange rate was not a policy target but was important for growth and stability, adding that appreciation of the euro "is a risk".


The comments left the euro down 0.2 percent at $1.3334.


Elsewhere in the currency market, sterling hit a seven-month low against the dollar, after a key policymaker made comments about the need for further weakness and recent poor data which has kept alive worries of another British recession.


Sterling fell 0.25 percent to $1.5476 having earlier touched $1.5438, its lowest since July 13.


DATA LOOMS


A big week for data on the outlook for the world's economy weighed on other riskier asset markets following the recent dire fourth-quarter growth numbers for the euro zone and Japan, along with Friday's soft U.S. manufacturing figures.


In European markets, attention is focused on the euro area Purchasing Managers' Indexes for February and German sentiment indices due later in the week which could affect hopes for a recovery this year.


Analysts expect Thursday's euro area flash PMI indices, which offer pointers to economic activity around six months out, to show growth stabilizing across the recession-hit region, leaving intact hopes for a recovery in the second half of 2013.


Concerns over an inconclusive outcome in the Italian election on Sunday and Monday have added to the weaker sentiment as a fragmented parliament could hamper a future government's efforts to reform the struggling economy.


The worries about the outlook for Italy were encouraging investors back into safe-haven German government bonds on Monday, with 10-year Bund yields easing 3.5 basis points to be around 1.63 percent.


"Political uncertainty will keep Bunds well bid this week," ING rate strategist Alessandro Giansanti said, adding that only better than expected economic data could create selling pressure on German debt in the near term.


Italian 10-year yields were 4 basis points higher on the day at 4.41 percent.


EARNINGS HIT


European equity markets were taking their lead from corporate earnings reports which have been reflecting the sluggish economic conditions across the region.


Danish brewer Carlsberg , which generates just over 60 percent of its sales in western Europe, became the latest to report a weaker-than-expected quarterly profit, sending its shares to their lowest level in almost a month.


The 5.8-percent drop for shares in the world's fourth biggest brewery helped send the FTSEurofirst 300 index <.fteu3> of top European shares down 0.2 percent. Germany's DAX <.gdaxi>, France's CAC-40 <.fchi> and Britain's FTSE-100 <.ftse> ranged between 0.4 percent up and 0.15 percent lower.


Earlier, the G20 statement and subsequent comment from Prime Minster Abe indicating a renewed drive to stimulate the Japanese economy lifted the Nikkei stock index <.n225> by 2.1 percent, near to its highest level since September 2008.


MSCI's world equity index <.miwd00000pus> was flat as markets extended a two-week period of consolidation that has followed the big run-up in January, when demand was buoyed by the efforts of central banks to stimulate the world economy.


Data from EPFR Global, a U.S.-based firm that tracks the flows and allocations of funds globally, shows investors pulled $3.62 billion from U.S. stock funds in the latest week, the most in 10 weeks after taking a neutral stance the prior week.


But demand for emerging market equities remained strong, with investors putting $1.81 billion in new cash into stock funds, the fund-tracking firm said.


CHINA RETURN


In the commodity markets, traders played catch-up after a week-long holiday last week in China, the world's second biggest consumer of many raw materials, which had kept activity subdued, with worries about the economic outlook weighing on sentiment.


Copper, for which China is the world's largest consumer, dipped to a near three-week low at $8,125.25 a metric ton (1.1023 tons) on the London futures market. Benchmark tin and nickel also touched three-week lows.


Gold managed to edge away from six-month lows as jewelers in China returned to the physical market after the Lunar New Year holiday but a lack of demand from U.S. markets saw the precious metal slip back to be down 0.1 percent to $1,607.06 an ounce.


Crude oil markets were mostly steady after the weak U.S. industrial production data on Friday [ID:nL1N0BF44A] was seen dampening demand, while tensions in the Middle East lent some support.


"We continue to see a mixed picture out of the United States. Industry output was lower than expected but that shouldn't affect the general upward direction," Olivier Jakob, analyst at Geneva-based Petromatrix, said.


Brent crude was down 20 cents at $117.46 a barrel after posting its first weekly loss since the first half of January. U.S. crude slipped 24 cents to $95.62.


(Additional reporting by Marius Zaharia and Ron Bousso; Editing by Philippa Fletcher and Alastair Macdonald)



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G20 steps back from currency brink, heat off Japan


MOSCOW (Reuters) - The Group of 20 nations declared on Saturday there would be no currency war and deferred plans to set new debt-cutting targets, underlining broad concern about the fragile state of the world economy.


Japan's expansive policies, which have driven down the yen, escaped direct criticism in a statement thrashed out in Moscow by policymakers from the G20, which spans developed and emerging markets and accounts for 90 percent of the world economy.


Analysts said the yen, which has dropped 20 percent as a result of aggressive monetary and fiscal policies to reflate the Japanese economy, may now continue to fall.


"The market will take the G20 statement as an approval for what it has been doing -- selling of the yen," said Neil Mellor, currency strategist at Bank of New York Mellon in London. "No censure of Japan means they will be off to the money printing presses."


After late-night talks, finance ministers and central bankers agreed on wording closer than expected to a joint statement issued last Tuesday by the Group of Seven rich nations backing market-determined exchange rates.


A draft communiqué on Friday had steered clear of the G7's call for economic policy not to be targeted at exchange rates. But the final version included a G20 commitment to refrain from competitive devaluations and stated monetary policy would be directed only at price stability and growth.


"The mood quite clearly early on was that we needed desperately to avoid protectionist measures ... that mood permeated quite quickly," Canadian Finance Minister Jim Flaherty told reporters, adding that the wording of the G20 statement had been hardened up by the ministers.


As a result, it reflected a substantial, but not complete, endorsement of Tuesday's proclamation by the G7 nations - the United States, Japan, Britain, Canada, France, Germany and Italy.


As with the G7 intervention, Tokyo said it gave it a green light to pursue its policies unchecked.


"I have explained that (Prime Minister Shinzo) Abe's administration is doing its utmost to escape from deflation and we have gained a certain understanding," Finance Minister Taro Aso told reporters.


"We're confident that if Japan revives its own economy that would certainly affect the world economy as well. We gained understanding on this point."


Flaherty admitted it would be difficult to gauge if domestic policies were aimed at weakening currencies or not.


NO FISCAL TARGETS


The G20 also made a commitment to a credible medium-term fiscal strategy, but stopped short of setting specific goals as most delegations felt any economic recovery was too fragile.


The communiqué said risks to the world economy had receded but growth remained too weak and unemployment too high.


"A sustained effort is required to continue building a stronger economic and monetary union in the euro area and to resolve uncertainties related to the fiscal situation in the United States and Japan, as well as to boost domestic sources of growth in surplus economies," it said.


A debt-cutting pact struck in Toronto in 2010 will expire this year if leaders fail to agree to extend it at a G20 summit of leaders in St Petersburg in September.


The United States says it is on track to meet its Toronto pledge but argues that the pace of future fiscal consolidation must not snuff out demand. Germany and others are pressing for another round of binding debt targets.


"We had a broad consensus in the G20 that we will stick to the commitment to fulfill the Toronto goals," German Finance Minister Wolfgang Schaeuble said. "We do not have any interest in U.S.-bashing ... In St. Petersburg follow-up-goals will be decided."


The G20 put together a huge financial backstop to halt a market meltdown in 2009 but has failed to reach those heights since. At successive meetings, Germany has pressed the United States and others to do more to tackle their debts. Washington in turn has urged Berlin to do more to increase demand.


Backing in the communiqué for the use of domestic monetary policy to support economic recovery reflected the U.S. Federal Reserve's commitment to monetary stimulus through quantitative easing, or QE, to promote recovery and jobs.


QE entails large-scale bond buying -- $85 billion a month in the Fed's case -- that helps economic growth but has also unleashed destabilising capital flows into emerging markets.


A commitment to minimize such "negative spillovers" was an offsetting point in the text that China, fearful of asset bubbles and lost export competitiveness, highlighted.


"Major developed nations (should) pay attention to their monetary policy spillover," Vice Finance Minister Zhu Guangyao was quoted by state news agency Xinhua as saying in Moscow.


Russia, this year's chair of the G20, admitted the group had failed to reach agreement on medium-term budget deficit levels and expressed concern about ultra-loose policies that it and other emerging economies say could store up trouble for later.


On currencies, the G20 text reiterated its commitment last November, "to move more rapidly toward mores market-determined exchange rate systems and exchange rate flexibility to reflect underlying fundamentals, and avoid persistent exchange rate misalignments".


It said disorderly exchange rate movements and excess volatility in financial flows could harm economic and financial stability.


(Additional reporting by Gernot Heller, Lesley Wroughton, Maya Dyakina, Tetsushi Kajimoto, Jan Strupczewski, Lidia Kelly, Katya Golubkova, Jason Bush, Anirban Nag and Michael Martina. Writing by Douglas Busvine. Editing by Timothy Heritage/Mike Peacock)



Read More..

G20 steps back from currency brink, heat off Japan


MOSCOW (Reuters) - The Group of 20 nations declared on Saturday there would be no currency war and deferred plans to set new debt-cutting targets, underlining broad concern about the fragile state of the world economy.


Japan's expansive policies, which have driven down the yen, escaped direct criticism in a statement thrashed out in Moscow by policymakers from the G20, which spans developed and emerging markets and accounts for 90 percent of the world economy.


Analysts said the yen, which has dropped 20 percent as a result of aggressive monetary and fiscal policies to reflate the Japanese economy, may now continue to fall.


"The market will take the G20 statement as an approval for what it has been doing -- selling of the yen," said Neil Mellor, currency strategist at Bank of New York Mellon in London. "No censure of Japan means they will be off to the money printing presses."


After late-night talks, finance ministers and central bankers agreed on wording closer than expected to a joint statement issued last Tuesday by the Group of Seven rich nations backing market-determined exchange rates.


A draft communiqué on Friday had steered clear of the G7's call for economic policy not to be targeted at exchange rates. But the final version included a G20 commitment to refrain from competitive devaluations and stated monetary policy would be directed only at price stability and growth.


"The mood quite clearly early on was that we needed desperately to avoid protectionist measures ... that mood permeated quite quickly," Canadian Finance Minister Jim Flaherty told reporters, adding that the wording of the G20 statement had been hardened up by the ministers.


As a result, it reflected a substantial, but not complete, endorsement of Tuesday's proclamation by the G7 nations - the United States, Japan, Britain, Canada, France, Germany and Italy.


As with the G7 intervention, Tokyo said it gave it a green light to pursue its policies unchecked.


"I have explained that (Prime Minister Shinzo) Abe's administration is doing its utmost to escape from deflation and we have gained a certain understanding," Finance Minister Taro Aso told reporters.


"We're confident that if Japan revives its own economy that would certainly affect the world economy as well. We gained understanding on this point."


Flaherty admitted it would be difficult to gauge if domestic policies were aimed at weakening currencies or not.


NO FISCAL TARGETS


The G20 also made a commitment to a credible medium-term fiscal strategy, but stopped short of setting specific goals as most delegations felt any economic recovery was too fragile.


The communiqué said risks to the world economy had receded but growth remained too weak and unemployment too high.


"A sustained effort is required to continue building a stronger economic and monetary union in the euro area and to resolve uncertainties related to the fiscal situation in the United States and Japan, as well as to boost domestic sources of growth in surplus economies," it said.


A debt-cutting pact struck in Toronto in 2010 will expire this year if leaders fail to agree to extend it at a G20 summit of leaders in St Petersburg in September.


The United States says it is on track to meet its Toronto pledge but argues that the pace of future fiscal consolidation must not snuff out demand. Germany and others are pressing for another round of binding debt targets.


"We had a broad consensus in the G20 that we will stick to the commitment to fulfill the Toronto goals," German Finance Minister Wolfgang Schaeuble said. "We do not have any interest in U.S.-bashing ... In St. Petersburg follow-up-goals will be decided."


The G20 put together a huge financial backstop to halt a market meltdown in 2009 but has failed to reach those heights since. At successive meetings, Germany has pressed the United States and others to do more to tackle their debts. Washington in turn has urged Berlin to do more to increase demand.


Backing in the communiqué for the use of domestic monetary policy to support economic recovery reflected the U.S. Federal Reserve's commitment to monetary stimulus through quantitative easing, or QE, to promote recovery and jobs.


QE entails large-scale bond buying -- $85 billion a month in the Fed's case -- that helps economic growth but has also unleashed destabilising capital flows into emerging markets.


A commitment to minimize such "negative spillovers" was an offsetting point in the text that China, fearful of asset bubbles and lost export competitiveness, highlighted.


"Major developed nations (should) pay attention to their monetary policy spillover," Vice Finance Minister Zhu Guangyao was quoted by state news agency Xinhua as saying in Moscow.


Russia, this year's chair of the G20, admitted the group had failed to reach agreement on medium-term budget deficit levels and expressed concern about ultra-loose policies that it and other emerging economies say could store up trouble for later.


On currencies, the G20 text reiterated its commitment last November, "to move more rapidly toward mores market-determined exchange rate systems and exchange rate flexibility to reflect underlying fundamentals, and avoid persistent exchange rate misalignments".


It said disorderly exchange rate movements and excess volatility in financial flows could harm economic and financial stability.


(Additional reporting by Gernot Heller, Lesley Wroughton, Maya Dyakina, Tetsushi Kajimoto, Jan Strupczewski, Lidia Kelly, Katya Golubkova, Jason Bush, Anirban Nag and Michael Martina. Writing by Douglas Busvine. Editing by Timothy Heritage/Mike Peacock)



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Wall Street flat but on track for seventh straight weekly gain

NEW YORK (Reuters) - Stocks were little changed on Friday as investors once again found few reasons to make big bets with the S&P 500 on track to close out a seventh straight week of gains.


Equities have struggled for direction recently, with major indexes moving only slightly in the past several sessions. The biggest daily move for the S&P in the past five sessions was on Tuesday, when it rose less than 0.2 percent.


The benchmark index, up nearly 7 percent so far this year, is facing strong technical resistance near the 1,525 level. But investors, expecting the index to advance further in the quarter, have held back from locking in profits.


"There's no news that suggests the strong underpinning for stocks isn't appropriate. We may have gotten ahead of ourselves, but there's also an absence of bad news," said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.


Many investors are starting to look ahead to a debate in Washington over sequestration, automatic across-the-board spending cuts put in place as part of a larger congressional budget fight. The cuts are due to kick in March 1 unless lawmakers agree to an alternative.


"This had been far enough out to not yet become an impediment for stocks, but it will start to move into the forefront and cause people to take a bit of a jaundiced eye towards the market," said Luschini, who helps oversee about $54 billion in assets.


The New York Federal Reserve said manufacturing in New York state expanded for the first time in seven months, while Thomson Reuters/University of Michigan's preliminary reading of consumer sentiment rose from the prior month and beat expectations.


But U.S. manufacturing fell in January after a rise in the prior month.


Wall Street's gain thus far in 2013 has largely been driven by strong corporate earnings, while data indicated some weakening in economic conditions.


The Dow Jones industrial average <.dji> was up 11.27 points, or 0.08 percent, at 13,984.66. The Standard & Poor's 500 Index <.spx> was up 0.32 points, or 0.02 percent, at 1,521.70. The Nasdaq Composite Index <.ixic> was up 1.51 points, or 0.05 percent, at 3,200.17.


The benchmark S&P 500 is up 0.2 percent for the week and is on track to register its seventh straight week of gains by the close of trading Friday, a feat not seen since a run of consecutive weekly gains between December 2010 and January 2011.


A surge in merger and acquisition activity, with more than $158 billion in deals announced so far in 2013, has given further support to the equity market as it points to healthy valuations and bets on the economic outlook.


Herbalife shares pared earlier gains and were up 8.5 percent to $41.53, a day after billionaire investor Carl Icahn said in a regulatory filing that he now owns 13 percent of Herbalife and was ready to put it in play.


MeadWestvaco Corp climbed 10 percent to $34.90 as the biggest percentage gainer on the S&P index after activist investor Nelson Peltz's Trian Fund Management LP said in an SEC filing it had bought about 1.6 million shares of the packaging company.


Burger King Worldwide shares gained 4 percent to $17.25 after it beat estimates with a 94 percent rise in fourth-quarter profit, thanks to new menu additions.


Oil service stocks declined, weighed by a 5.6 percent drop in shares of Transocean to $55.99, after the rig contractor reported its fleet update and Deutsche Bank cut its rating on the stock to "sell." The PHLX oil service sector <.osx> lost 1.7 percent.


(Editing by Nick Zieminski)



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Wall Street edges up, Dow nears all-time high

NEW YORK (Reuters) - Stocks edged higher on Tuesday, putting the Dow within striking distance of all-time highs as investors looked ahead to President Barack Obama's State of the Union address, which is expected to focus on the economy.


Jobs and economic growth are seen as major themes of Obama's speech, scheduled to begin at 9 p.m. (0200 GMT Wednesday). Investors will also listen for any clues on a deal with Republicans to avert automatic spending cuts due to take effect March 1, including the tone of the speech.


The S&P 500 has risen for the past six weeks, putting it up 6.7 percent so far this year, while the Dow is about 1 percent away from its all-time intraday record of 14,198.10, reached in October 2007.


But gains have been harder to come by since the benchmark S&P index hit a five-year high on February 1. The market has had to consolidate strong gains at the year's start while investors search for reasons to drive stocks higher.


"We're likely to settle in for a period and digest the gains we've had, though there's still a bias towards positive momentum," said Eric Teal, chief investment officer at First Citizens Bancshares in Raleigh, North Carolina. "Questions over government spending are the big overhang, and we're looking for Obama to inspire some confidence over that tonight."


The White House has signaled Obama will urge investment in infrastructure and clean energy, suggesting companies in those sectors may be volatile in Wednesday's session.


"Gun makers could also see a reaction if Obama talks about anything with respect to gun control," said Teal, who helps oversee $5 billion. Shares of Smith & Wesson were flat at $9.13 while Sturm Ruger was up 0.5 percent at $53.96.


The Dow Jones industrial average <.dji> was up 58.06 points, or 0.42 percent, at 14,029.30. The Standard & Poor's 500 Index <.spx> was up 3.34 points, or 0.22 percent, at 1,520.35. The Nasdaq Composite Index <.ixic> was down 1.91 points, or 0.06 percent, at 3,190.09.


Housing shares were among the strongest of the day, led by a 14.4 percent jump in Masco Corp to $20.35 after the home improvement product maker said it expects new home construction to show strong growth in 2013. The PHLX housing sector index <.hgx> rose 4.3 percent.


Avon Products Inc surged 23 percent to $21.25 as the S&P 500's top percentage gainer after the cosmetics company reversed sales declines and cut costs.


On the downside, Coca-Cola Co fell 2.7 percent to $37.58 and were the biggest drag on the Dow after reporting revenue that was below estimates, hurt by a weaker-than-expected performance in Europe.


Goodyear Tire & Rubber shares slipped 0.4 percent to $13.86 after it posted a stronger-than-expected quarterly profit but cut its 2013 forecast due to weakness in the European automotive market.


Michael Kors Holdings shares jumped 10.8 percent to $63.18 after the fashion company handily beat Wall Street's estimates and raised its full-year outlook.


With earnings season starting to wind down, Thomson Reuters data through Tuesday morning shows of the 353 companies in the S&P 500 that have reported earnings, 70.3 percent have exceeded analysts' expectations, above a 62 percent average since 1994 and 65 percent over the past four quarters.


Fourth-quarter earnings for S&P 500 companies are estimated to have risen 5.3 percent, according to the data, above a 1.9 percent forecast at the start of the earnings season.


(Editing by Nick Zieminski)



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Wall Street ticks lower, investors seek new catalysts

NEW YORK (Reuters) - Stocks fell modestly on Monday as investors found few reasons to keep pushing shares higher following a six-weeks-long advance that has taken the S&P 500 index near record highs.


The benchmark index is up more than 6 percent so far this year after a steep rally in January that has stalled as the S&P and Dow industrials near multi-year highs.


"This is still a market that looks terrific, but when you're up for six weeks in a row, everyone is going to want to take a pause going into the seventh week even if there is no bad news out there," said Eric Kuby, chief investment officer at North Star Investment Management in Chicago.


The S&P 500 would need to rise 3.9 percent to reach its all-time intraday high of 1,576.09, which was hit in October 2007.


Google Inc shares fell 1 percent at $777.67 after the company said in a filing former chief executive Eric Schmidt is selling roughly 42 percent of his stake in the Internet search giant, a move that could potentially net him $2.51 billion.


But the decline was offset by gains in Apple , up 1.4 percent at $481.73 after a New York Times report that the iPhone maker is experimenting with the design of a device similar to a wristwatch.


The Federal Reserve's Vice Chair Janet Yellen, seen as a potential successor to Fed Chairman Ben Bernanke next year, said the Fed is still aggressively stimulating an anemic U.S. economic recovery that has failed to bring rapid progress on employment.


The Dow Jones industrial average <.dji> was down 31.05 points, or 0.22 percent, at 13,961.92. The Standard & Poor's 500 Index <.spx> was down 1.80 points, or 0.12 percent, at 1,516.13. The Nasdaq Composite Index <.ixic> was down 5.25 points, or 0.16 percent, at 3,188.62.


Upbeat U.S. and Chinese data last week helped the S&P 500 extend its weekly winning streak to six. The index gained about 8 percent over that period.


Equities have been strong performers lately, rising 6.3 percent so far this year. Many investors have used any declines in the market as opportunities to buy.


"Everyone wants to buy on a dip in this market, but if you're on the sidelines right now, the decline we're seeing today just isn't the kind you would jump in on," Kuby said.


President Barack Obama will describe his plan for spurring the economy in his State of the Union address on Tuesday. He is expected to offer proposals for investment in infrastructure, manufacturing, clean energy and education.


Opposition has grown to the $24.4 billion buyout of Dell Inc , the No. 3 personal computer maker, as three of the largest investors joined Southeastern Asset Management on Friday in raising objections. Dell said in a regulatory filing it had considered many strategic options before opting to go private in a buyout led by Chief Executive Michael Dell.


Dell shares hovered near $13.65, the buyout offer price.


Regeneron Pharmaceuticals Inc shares rose 1.6 percent at $168.72 after it said longtime drug development partner Sanofi plans to boost its stake.


Moody's Corp was one of the strongest percentage gainers on the S&P 500, rising 3.9 percent to $45.06. Last week the stock plunged 22 percent after the U.S. government launched a civil lawsuit against the company. The sell-off marked the stock's worst week since October 2008.


(Editing by Nick Zieminski)



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Stocks end higher for sixth straight week, tech leads

NEW YORK (Reuters) - The Nasdaq composite stock index closed at a 12-year high and the S&P 500 index at a five-year high, boosted by gains in technology shares and stronger overseas trade figures.


The S&P 500 also posted a sixth straight week of gains for the first time since August.


The technology sector led the day's gains, with the S&P 500 technology index <.splrct> up 1.0 percent. Gains in professional network platform LinkedIn Corp and AOL Inc after they reported quarterly results helped the sector.


Shares of LinkedIn jumped 21.3 percent to $150.48 after the social networking site announced strong quarterly profits and gave a bullish forecast for the year.


AOL Inc shares rose 7.4 percent to $33.72 after the online company reported higher quarterly profit, boosted by a 13 percent rise in advertising sales.


Data showed Chinese exports grew more than expected, a positive sign for the global economy. The U.S. trade deficit narrowed in December, suggesting the U.S. economy likely grew in the fourth quarter instead of contracting slightly as originally reported by the U.S. government.


"That may have sent a ray of optimism," said Fred Dickson, chief market strategist at D.A. Davidson & Co in Lake Oswego, Oregon.


Trading volume on Friday was below average for the week as a blizzard swept into the northeastern United States.


The U.S. stock market has posted strong gains since the start of the year, with the S&P 500 up 6.4 percent since December 31. The advance has slowed in recent days, with fourth-quarter earnings winding down and few incentives to continue the rally on the horizon.


"I think we're in the middle of a trading range and I'd put plus or minus 5.0 percent around it. Fundamental factors are best described as neutral," Dickson said.


The Dow Jones industrial average <.dji> ended up 48.92 points, or 0.35 percent, at 13,992.97. The Standard & Poor's 500 Index <.spx> was up 8.54 points, or 0.57 percent, at 1,517.93. The Nasdaq Composite Index <.ixic> was up 28.74 points, or 0.91 percent, at 3,193.87, its highest closing level since November 2000.


For the week, the Dow was down 0.1 percent, the S&P 500 was up 0.3 percent and the Nasdaq up 0.5 percent.


Shares of Dell closed at $13.63, up 0.7 percent, after briefly trading above a buyout offering price of $13.65 during the session.


Dell's largest independent shareholder, Southeastern Asset Management, said it plans to oppose the buyout of the personal computer maker, setting up a battle for founder Michael Dell.


Signs of economic strength overseas buoyed sentiment on Wall Street. Chinese exports grew more than expected in January, while imports climbed 28.8 percent, highlighting robust domestic demand. German data showed a 2012 surplus that was the nation's second highest in more than 60 years, an indication of the underlying strength of Europe's biggest economy.


Separately, U.S. economic data showed the trade deficit shrank in December to $38.5 billion, its narrowest in nearly three years, indicating the economy did much better in the fourth quarter than initially estimated.


Earnings have mostly come in stronger than expected since the start of the reporting period. Fourth-quarter earnings for S&P 500 companies now are estimated up 5.2 percent versus a year ago, according to Thomson Reuters data. That contrasts with a 1.9 percent growth forecast at the start of the earnings season.


Molina Healthcare Inc surged 10.4 percent to $31.88 as the biggest boost to the index after posting fourth-quarter earnings.


The CBOE Volatility index <.vix>, Wall Street's so-called fear gauge, was down 3.6 percent at 13.02. The gauge, a key measure of market expectations of short-term volatility, generally moves inversely to the S&P 500.


"I'm watching the 14 level closely" on the CBOE Volatility index, said Bryan Sapp, senior trading analyst at Schaeffer's Investment Research. "The break below it at the beginning of the year signaled the sharp rally in January, and a rally back above it could be a sign to exercise some caution."


Volume was roughly 5.6 billion shares traded on the New York Stock Exchange, the Nasdaq and the NYSE MKT, compared with the 2012 average daily closing volume of about 6.45 billion.


Advancers outpaced decliners on the NYSE by nearly 2 to 1 and on the Nasdaq by almost 5 to 3.


(Additional reporting by Angela Moon; Editing by Bernadette Baum, Nick Zieminski, Kenneth Barry and Andrew Hay)



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Wall Street extends gains, Nasdaq near 12-year high


NEW YORK (Reuters) - Stocks extended gains on Friday, with the Nasdaq rising 1 percent, putting it within close reach of a 12-year high.


The Dow Jones industrial average <.dji> gained 47.66 points, or 0.34 percent, to 13,991.71. The Standard & Poor's 500 Index <.spx> rose 7.47 points, or 0.49 percent, to 1,516.86. The Nasdaq Composite Index <.ixic> was up 30.23 points, or 0.96 percent, at 3,195.37.


If the Nasdaq rises above 3,196.93, it would be the highest level since November 2000.


(Reporting by Leah Schnurr; Editing by Bernadette Baum)



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Wall Street dips on renewed euro zone fears

NEW YORK (Reuters) - Stocks fell on Thursday as comments by the ECB president on the euro raised worries about Europe's outlook and curbed investors' appetite for risky assets.


The euro currency dropped against the safe-haven dollar and yen after European Central Bank President Mario Draghi said the exchange rate was important to growth and price stability, which investors took as a sign the bank is concerned about the euro's advance in recent days.


Materials shares were among the weakest performers on the S&P 500, with the S&P 500 materials index <.splrcma> down 0.7 percent, while housing stocks also declined. A housing sector index <.hgx> was off 1.4 percent.


Despite the day's decline and weakness earlier this week, the stock market has been in an almost uninterrupted uptrend for most of the year, with the S&P 500 gaining more than 5 percent for 2013.


Many investors could see buying opportunities in the decline.


"I don't think there's the systemic risk that we had some time ago of bank failures in Europe and so forth. They seem to be ahead of that sort of crisis," said Dan Veru, chief investment officer of Palisade Capital Management, in Fort Lee, New Jersey.


The Dow Jones industrial average <.dji> was down 67.95 points, or 0.49 percent, at 13,918.57. The Standard & Poor's 500 Index <.spx> was down 6.31 points, or 0.42 percent, at 1,505.81. The Nasdaq Composite Index <.ixic> was down 16.76 points, or 0.53 percent, at 3,151.72.


Top U.S. retailers reported strong January sales after offering compelling merchandise that drew in shoppers facing a hit to their take-home pay from higher payroll taxes.


Macy's Inc rose 1.5 percent to $40.09 after reporting January same store sales rose 11.7 percent.


But Ann Inc dropped 6.7 percent to $30.59 after forecasting fourth-quarter sales below analysts' expectations.


Fund manager David Einhorn's Greenlight Capital on Thursday said it has sued Apple Inc and said the company needs to do more to unlock value for shareholders. Apple shares gained 0.6 percent to $457.43.


Akamai Technologies Inc lost 15.6 percent to $35.06 as the worst performer on the S&P 500 after the Internet content delivery company forecast current-quarter revenue below analysts' expectations.


(Additional reporting by Angela Moon; Editing by Kenneth Barry and Nick Zieminski)



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Wall Street stymied as investors lack catalysts to trade

NEW YORK (Reuters) - U.S. stocks were little changed on Wednesday as investors, without any major economic reports to guide them, awaited fresh incentives to trade after rallies took the S&P 500 to five-year highs.


Transportation stocks were among the worst performers, weighed down by a 10 percent drop in CH Robinson Worldwide to $60.40 after the freight transport company posted a lower-than-expected adjusted quarterly profit.


The Dow Jones Transportation index <.djt> shed 0.3 percent after closing at a record high Tuesday for a gain of more than 10 percent in 2013.


The benchmark S&P 500 index has advanced 6 percent this year, climbing to its highest since December 2007. The Dow industrials <.dji> have risen above 14,000 recently, making it a challenge for investors to push stocks higher in the absence of strong positive catalysts.


"Overall, we believe that the next near-term market dip should provide an opportunity to buy stocks ahead of rallies higher in the coming months, but we are skeptical about the long-term sustainability of these gains due to the maturing age of the bull market," said Ari Wald, equity research analyst at C&Co\PrinceRidge in New York.


The Dow Jones industrial average <.dji> was up 5.28 points, or 0.04 percent, at 13,984.58. The Standard & Poor's 500 Index <.spx> was up 0.56 point, or 0.04 percent, at 1,511.85. The Nasdaq Composite Index <.ixic> was up 1.67 points, or 0.05 percent, at 3,173.25.


The tech-heavy Nasdaq index was supported by Apple Inc , which rose 1.1 percent to $462.62.


Walt Disney Co was among the bright spots, up 1.1 percent at $60.31, after the company beat estimates for quarterly adjusted earnings and gave an optimistic outlook for the next few quarters.


According to Thomson Reuters data through Wednesday morning, of 301 companies in the S&P 500 <.spx> that have reported earnings, 68.1 percent have exceeded analysts' expectations, above a 62 percent average since 1994 and 65 percent over the past four quarters. In terms of revenue, 65.8 percent of companies have topped forecasts.


Looking ahead, fourth-quarter earnings for S&P 500 companies are expected to grow 4.7 percent, according to the data, above a 1.9 percent forecast at the start of the earnings season.


The benchmark S&P index rose 1.04 percent Tuesday, its biggest percentage gain since a 2.5-percent advance on January 2 after lawmakers agreed on a temporary delay of the "fiscal cliff."


Ralph Lauren Corp climbed 8 percent to $178.15 as the best performer on the S&P 500 after reporting renewed momentum in its holiday-quarter sales and profits.


Time Warner Inc jumped 4.4 percent to $52.15 after reporting higher fourth-quarter profit that beat Wall Street estimates, as growth in its cable networks offset declines in its film, TV entertainment and publishing units.


Visa , the world's largest credit and debit card network, is expected to report earnings per share of $1.79 for its first quarter, up from $1.49 a year earlier. Smaller rival MasterCard MA.N recently reported better-than-expected results but said its revenue growth could slow in the first half of the year due to economic uncertainty.


(Editing by Bernadette Baum and Kenneth Barry)



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Wall Street climbs 1 percent on results; Dow above 14,000

NEW YORK (Reuters) - Stocks climbed on Tuesday, pushing the Dow above 14,000 a day after the market's biggest sell-off since November, as stronger-than-expected earnings brightened the profit picture.


All 10 S&P sectors were higher, and the S&P 500 and Nasdaq gained more than 1 percent.


Dell Inc's stock rose after the world's No. 3 computer maker agreed to be taken private in a $24.4 billion deal, the largest leveraged buyout since the 2008-2009 financial crisis. The stock gained 1.3 percent to $13.44 after a delayed open.


The market's bounce follows a sell-off on Monday that gave the S&P 500 its biggest percentage decline since mid-November. Still, the benchmark is up about 5 percent since the start of the year and is less than 5 percent away from its all-time intraday high of 1,576.09 in October 2011.


Analysts said fourth-quarter results have been among the positives for the market. On Tuesday, Archer Daniels Midland reported revenue and adjusted fourth-quarter earnings that beat expectations, boosted by strong global demand for oilseeds. Shares rose 3.4 percent to $29.40.


"This quarter was one that had relatively low expectations coming into it, but the beats on the earnings and on the revenue side have been pretty good, particularly on the revenue side," said Mark Luschini, chief investment strategist at Janney Montgomery Scott in Philadelphia.


"And in the aggregate so far, the earnings growth is just under 5 percent, and that's relieved those who thought maybe the earnings picture was deteriorating to the point where we would see surprisingly poor earnings."


The Dow Jones industrial average <.dji> was up 121.49 points, or 0.88 percent, at 14,001.57. The Standard & Poor's 500 Index <.spx> was up 16.95 points, or 1.13 percent, at 1,512.66. The Nasdaq Composite Index <.ixic> was up 40.79 points, or 1.30 percent, at 3,171.96.


Also in earnings, Estée Lauder Cos Inc reported a higher quarterly profit and raised its full-year profit forecast. The stock rose 5.7 percent to $64.52.


With results in for more than half of the S&P 500 companies, 69 percent have beaten profit expectations, compared with the 62 percent average since 1994 and the 65 percent average over the past four quarters.


Fourth-quarter earnings for S&P 500 companies are expected to rise 4.5 percent, according to the data, above the 1.9 percent forecast at the start of earnings season.


On the down side, McGraw-Hill shares slumped 7.5 percent to $46.51 after the Justice Department filed a civil lawsuit against it seeking $5 billion over mortgage bond ratings. Standard & Poor's, a McGraw Hill unit, was accused of inflated ratings and understated risks out of a desire to gain more business from investment banks.


On Monday, the stock market suffered its worst one-day decline since the 1987 market crash.


(Additional reporting By Angela Moon; Editing by Kenneth Barry)



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Wall Street pulls back after recent gain; data disappoints

NEW YORK (Reuters) - Stocks dropped on Monday, pulling back from gains in the prior session that left the S&P 500 at a five-year high and the Dow above 14,000, as factory orders data disappointed and worries about the euro zone crisis resurfaced.


The S&P 500 was on track for its biggest daily percentage decline since December 28. Chevron and Wal-Mart were among the biggest drags on the Dow after analyst downgrades.


"The market is due for a pullback. That's not really a surprise. I think people are looking for an excuse to make sales," said Michael James, senior trader at Wedbush Morgan in Los Angeles.


Spanish and Italian bond yields rose, renewing worries about the euro zone's sovereign debt crisis. Spain's prime minister faced calls to resign over a corruption scandal, while a probe of alleged misconduct involving an Italian bank was expected to widen three weeks before a national election.


Data from the Commerce Department showed overall factory orders for December were below economists' expectations.


The Dow Jones industrial average <.dji> was down 120.19 points, or 0.86 percent, at 13,889.60. The Standard & Poor's 500 Index <.spx> was down 14.65 points, or 0.97 percent, at 1,498.52. The Nasdaq Composite Index <.ixic> was down 40.53 points, or 1.27 percent, at 3,138.57.


The benchmark S&P 500 rose on Friday, leaving it roughly 60 points away from its all-time intraday high of 1,576.09, while the Dow's march above 14,000 was the highest for the index since October 2007.


The S&P index <.spx> is up 5.5 percent for the year, with nearly half of the gains coming after U.S. legislators temporarily sidestepped the "fiscal cliff" of automatic tax increases and spending cuts.


The CBOE Volatility index VIX <.vix>, Wall Street's so-called fear gauge, jumped more than 10 percent to 14.48 by afternoon trade.


Chevron Corp dipped 0.9 percent to $115.50 after UBS cut its rating to neutral, while Wal-Mart Stores Inc shed 1.1 percent to $69.69 after JP Morgan lowered its rating on the world's largest retailer and reduced its price target.


Shares of household products company Clorox rose 1.3 percent to $80.23 after quarterly profit beat analysts' estimates as a severe flu season boosted sales of disinfecting wipes.


According to Thomson Reuters data, of the 256 companies in the S&P 500 that have reported earnings through Monday morning, 68.4 percent have reported earnings above analyst expectations compared with the 62 percent average since 1994 and the 65 percent average over the past four quarters.


S&P 500 fourth-quarter earnings are expected to rise 4.4 percent, according to the data. That estimate is above the 1.9 percent forecast at the start of earnings season, but well below the 9.9 percent fourth-quarter earnings forecast on October 1.


Herbalife Ltd slumped 2.5 percent to $34.16 after the New York Post newspaper reported the seller of weight loss products is facing a probe by the Federal Trade Commission.


(Additional reporting by Angela Moon; Editing by Kenneth Barry and Nick Zieminski)



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