Stock Market News for August 10, 2010 - Market News

U.S. stocks retraced Friday’s losses amid hopes that a case for fresh stimulus is slowly gaining ground. However, volume on the New York Stock Exchange fell to its lowest of the year as cautious investors refrained from taking big positions ahead of the central bank’s Tuesday meeting.

In today’s meeting, the Fed is likely to keep the “extended period” language intact, amid growing hopes that the central bank would adopt some more easing methods as downbeat economic data threaten to jeopardize the recovery. 

The Dow average added 45 points, or 0.4%, to 10698.75.  The strength in technology stocks sent the Nasdaq up 17 points, or 0.75%, to 2305.69. The broader Standard & Poor's 500 index gained 6 points, or 0.55%, to 1127.79. On the New York Stock Exchange, advancing shares beat those that fell in price by a three-to-one margin as volume dipped to 790 million shares.

Although Wall Street still appeared to be calculating the damages resulting from Mark Hurd’s sudden departure from Hewlett-Packard HPQ, rival technology companies including Cisco Systems CSCO and International Business Machines IBM showed strength, in part due to the uncertainty surrounding H-P. Shares in Cisco Systems and International Business Machines gained 2.9% and 1.4%, respectively. H-P dropped 8% to $42.60 and led the declining Dow components. Google GOOG gained 1% to $505.35. 

Oracle’s ORCL CEO Larry Ellison criticized Hewlett-Packard HPQ boards' move to remove Mark Hurd, and said the move was identical to Apple’s AAPL decision some years ago to remove Steve Jobs.

Leading the gainers on the Dow average was McDonald’s MCD which reported a 7% jump in same-store sales. The fast-food company’s US sales jumped the most in a year. Its shares closed up $1.18 to $72.92.

Yesterday, Deutsche Bank DB noted some housing shares undervalued, and raised its ratings on homebuilders DR Horton DHI, up 4.3%, Meritage Homes MTH, up 6.8%, and Ryland RYL, up 7.8%. Deutsche Bank noted, "Five years into the housing market's fall, we believe it is finally near the point from which it can sustainably recover...We aren't upgrading our housing outlook; rather, we think the completion of the triple-U trajectory has brought housing to a natural bottom."

Asian markets were weak today, with the Shanghai Composite dropping the most in six weeks, closing off 2.9%.  The Hang Seng index in Hong Kong fell 1.5% and the Nikkei 225 stock average closed off 0.2%.

As the flood of earnings reports dies down, some key reports remain. Among them is today's after-the-close release from DJIA component, Disney DIS. Fiscal third quarter earnings are expected to show per share results of 58 cents up from 52 cents a year ago on revenues of $9.37 billion, up 9% from last year.

 
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